ESG is a hot topic. The extent to which a company makes a positive contribution to respecting human rights, diversity and the climate plays an increasingly important role. This brings both opportunities and risks. In recent years, we have seen an increase in national and European laws and regulations relating to ESG as well as changing expectations from investors, clients and regulators regarding the social policy pursued.
European legislation touching on the subject of ESG has so far focused mainly on climate targets that countries must achieve and sustainability reporting. Such reporting mainly results in reports on the impact of companies’ activities on people and the environment.
However, developments are ongoing. European and national legislation that imposes due diligence obligations on certain companies, to understand and address negative impacts on human rights and the environment in the value chain, is imminent. ESG legislation and its impact are expected to increase significantly in the coming years.
BarentsKrans advises clients on a variety of ESG and corporate social responsibility issues, including:
- Corporate governance, sustainable financing, financial and corporate reporting, liability risk management and enforcement (under civil as well as administrative law);
- Equal opportunities and equal treatment of employees, terms of employment, remuneration policy, training policy, and employee consultation;
- Product as a service and circular construction, energy labels, green leasing, (nearly) zero-energy buildings (NZEB), redevelopment, renovation and sustainability, smart grids, electrification, renewable energy, solar farm access to power grids, storage/batteries, renewable heat supply and solar panels.
ESG plays a role within multiple jurisdictions. Our specialists work in multidisciplinary teams when necessary.
Our employment lawyers have the legal expertise to ensure equal opportunities for everyone within an organisation. This ranges from hiring to promotion policies, and from negotiating terms of employment to codes of conduct, and contributes to inclusiveness within a company.
Terms of employment
Moreover, terms of employment may need to be changed as a result of sustainability goals. Examples are sustainable commuting (and private use of leased cars), hybrid working and business travel. We have extensive experience in legal assistance in such change processes.
Safety in the workplace
Social and physical safety in the workplace contributes to diversity and inclusion. We advise on the drafting of codes of conduct and integrity, whistleblower regulations and enforcement policies, always keeping the interests of all parties concerned in mind.
Employee consultation processes
ESG can also play an essential role in employee consultation processes that we support. For example, a works council has the legal right to advise on proposed decisions to take important measures related to corporate environmental management. These include policy, organisational and administrative measures. Examples are relevant investments, adjusting production processes, creating a corporate environmental plan and establishing or adjusting an environmental management system.
The growing importance of ESG has implications for current and future contracts. Our Commercial Contracts team is happy to assist you throughout the life cycle of a commercial contract: from negotiations to termination of a contract. These may include purchase and sales agreements, supply agreements and distribution, agency and franchise agreements, for example.
Corporate, Commercial & Financial Litigation
Investors, buyers and other stakeholders are increasingly looking at the ESG performance of (potential) investee companies or companies from which they purchase products. Companies (and those involved in the organisation of those companies) must also increasingly comply with ESG obligations, which can be far-reaching. This entails an increased risk that they will be held accountable for (inadequate) ESG performance, and, for example, exposed to civil litigation if they fail to meet their ESG obligations or provide incorrect or misleading ESG information (‘greenwashing’). There is a real risk here that such litigation will be initiated as class actions, with interest groups representing the interests of all aggrieved investors. Our specialists advise, among other things, on the management of ESG liability risks and the conduct of related proceedings.
Corporate / M&A
Our corporate / M&A specialists advise, among other things, on investments in sustainable companies and other companies, and on board regulations and shareholder agreements to achieve ESG goals. They also advise on existing and upcoming ESG laws and regulations and how to anticipate the latter
Our real estate specialists assist clients on ESG issues with respect to:
- developing and realising sustainable buildings and area development, solar parks, heat grids and CHP plants;
- permits and environmental legislation;
- achieving a reliable supply chain;
- establishing partnerships;
- financing developments and acquiring related real estate, for example, in drafting or negotiating loan documents, conducting due diligence investigations in the context of purchase or sale or financing, structuring circular and sustainable buildings;
- renting and leasing (green leasing) of real estate;
- dual use of space;
- renovation and sustainability, e.g. regarding sustainable maintenance and performance contracts; and
- constructing and operating new heating and/or cooling systems.