Over the past year, the regulatory backdrop around environmental, social and governance (ESG) investing has shifted. As McDermott Partner Brian J. Tiemann explains in these slides, the US Department of Labor (DOL) under the Trump administration dropped ESG terminology and set a high standard for considering factors other than purely financial projections for investment alternatives. However, the Biden administration’s DOL has said that it will not enforce Trump-era regulations or pursue enforcement actions against plan fiduciaries for failure to comply with those regulations.
Environmental, social and corporate governance (ESG) efforts can create hazards for multinationals with US operations due to the risk of reverse discrimination litigation under US law. According to McDermott’s Ludia Kwon, a recently filed lawsuit (Kafiti v. AB Electrolux, Case No. 3:21-CV-00029 (W.D. NC. 2021)) highlights the risk in implementing ESG efforts in the United States. US employment discrimination laws swing both ways, as the prohibition against sex discrimination protects men as well as women.
Subscribe
