Navigating the Anti-ESG Backlash: Rising Legal Risks in a Politicised Climate

In an article recently authored for IFLR, Takahiro Nonaka discusses the evolving legal risks related to companies’ ESG strategies, “from shareholder activism to federal rollbacks”. As Takahiro notes:

“First introduced in a landmark 2004 UN report prepared by institutional investors and asset owners, the term ESG—referring to ESG factors not traditionally captured on corporate balance sheets—has become a defining feature of corporate strategy across industries and jurisdictions. Once embraced as hallmarks of sustainable business and long-term value creation, ESG commitments are now, however, facing a coordinated and intensifying backlash. In particular, the environmental and social aspects of ESG initiatives have been targeted by private and public actors in a movement that has accelerated since the 2024 US presidential election. This shift has real legal consequences—particularly for multinational companies exposed to diverging expectations from US regulators, state attorneys general, shareholder activists, and global investors. Such companies are now caught between competing interests from pro-and anti-ESG forces.”

The article goes onto discuss the various threats that present “a source of real and emerging legal exposure.”

Read the full article (subscription required).