Environmental, Social and Governance (ESG)

Environmental issues continue to anchor the ESG movement, with climate change at the forefront. Recently, however, ESG has come to mean much more. It also refers to a variety of the internal social issues companies must navigate, such as labor practices, talent management, executive pay, internal pay equity, product and manufacturing safety, data security, board and management diversity and business ethics; as well as external social issues that are becoming increasingly important, such as financial inclusion, community uplift and responsible investment. McGuireWoods’ ESG team members prepare our clients for next steps in the evolution of their ESG practices and company-specific ESG goals, as well as advise and represent our clients on the transactions designed to achieve these practices and goals.

ESG Services

Our lawyers and policy advisers help clients identify, analyze and integrate ESG concerns and priorities across their operations. Meeting our clients where they are, we draw on the collective knowledge, experience and skills of lawyers and governmental affairs professionals whose practices focus on environmental regulation, climate regulation, corporate governance, investor engagement and communications, public company disclosure requirements, energy, international trade, labor and employment, global investigations, tax policy, cybersecurity and corporate transactions, including public and private offerings and sustainable financings. Our team helps companies evaluate and develop their specific ESG targets, report on ESG issues responsibly and effectively, and create policies and procedures to integrate ESG into daily operations and long-term planning — all while avoiding common pitfalls that can inadvertently lead to unwanted liability risk. For companies that have already fallen under the scrutiny of regulators or activist groups, our team assists clients in navigating the complex challenges of an investigation and defense of enforcement proceedings and in defense of civil actions.

Our ESG Services

ESG Client Forum: McGuireWoods attorneys lead a client group that provides daily updates on climate and ESG developments, including ESG best practices, ESG reporting standards, regulatory requirements, and legal proceedings and litigation. The group, which meets monthly to discuss these important issues, includes major electric utility companies and national trade associations.

ESG Best Practices and Risk Mitigation: The McGuireWoods ESG team assists companies with development of best practices and formal procedures to minimize risks from both required and voluntary ESG reporting, including measures to ensure company employees speak with one voice on ESG issues and that ESG pledges and public statements are realistic and accurately and appropriately described.

Guidance on ESG Reporting Platforms: McGuireWoods ESG attorneys help companies choose among the many competing third party platforms for making ESG disclosures to ensure companies are using the best tools available. Where reporting platforms rate companies on ESG performance, the McGuireWoods team makes sure companies have policies in place that help them achieve the highest possible scores. When one-size-fits-all reporting platforms do not conform to individual company needs, McGuireWoods helps companies customize their disclosures and prepare appropriate documentation to justify that customization.

Compliance with Securities Regulations: McGuireWoods ESG attorneys advise companies on reporting requirements under Securities and Exchange Commission (SEC) rules and help companies prepare accurate disclosures that comply with such requirements.

Corporate Governance and Investor Engagement: McGuireWoods ESG attorneys work closely with our public company clients on how to formalize board oversight of ESG risk management and ESG company initiatives through corporate governance guidelines and board charters. We regularly assist our clients with proactive investor engagement on a variety of ESG topics, as well as provide advice on handling ESG topics and questions during earnings calls, annual meetings and road shows.

ESG Shareholder Proposals: McGuireWoods attorneys have a long history of assisting public companies with navigating the shareholder proposal process, including confirming the appropriateness of such proposals under the rules of the SEC, engaging with proponents on possible withdrawal, drafting and submitting exclusion requests to the SEC and preparing management’s recommendations to shareholders on how to vote on such proposals.

Emerging Regulatory Requirements: McGuireWoods attorneys provide companies with analysis and advice on mitigating risks posed by emerging regulations that impact and could potentially govern ESG reporting obligations and related issues, including rules from the SEC, the Department of Labor and the U.S. Treasury. McGuireWoods is well positioned to help clients participate in the regulatory process, through preparation of rulemaking comments and otherwise, to secure a favorable regulatory playing field.

Government Investigations and Enforcement Proceedings: For over a decade, Fortune 100 companies and high-profile individuals worldwide have called on McGuireWoods’ nationally recognized Government Investigations & White Collar Litigation practice to handle some of their most notable and complex matters before a myriad of regulators, from U.S. congressional hearings and enforcement investigations led by the SEC, the FERC and state attorneys general, to global investigations involving the FCA and the SFO in the U.K. Our deep bench of lawyers has significant experience with investigations at the intersection of law and politics, including a former Deputy Attorney General of the United States, former U.S. Attorneys, more than a dozen federal prosecutors, and other former senior enforcement officials from key agencies involved in ESG issues, including the SEC and the FERC.

Environmental Justice: Social and environmental considerations intersect in environmental justice, a priority policy item of the current U.S. federal administration. The McGuireWoods environmental team advises companies and trade organizations on environmental justice legislation, state law developments and emerging federal regulatory requirements that will impact companies in multiple ways, including facility permitting and project development.

Agency Rulemaking Proceedings: McGuireWoods attorneys assist clients in preparing rulemaking comments to federal agencies that will help the federal government shape future ESG regulations and policies. Our ESG team has experience before multiple agencies including the EPA, the FERC, the SEC, the Department of Labor and others. Our ESG team also has experience in litigation challenging or defending federal agency regulations once they are final.

Risk Assessment: McGuireWoods’ ESG team advises companies — including those in regulated industries, the investment community, and lending and insurance institutions — on the risks facing various business sectors, including risks posed by climate-related regulations, corporate governance requirements and social policy addressed by varied authorities such as labor and employment rules. This type of assessment can include evaluation of company ESG products and as-yet-unaddressed risks.

Renewable Energy Projects and Renewable Energy/Environmental Attribute Procurement: McGuireWoods has represented developers, independent power producers, infrastructure funds and utilities in projects in 40 states, totaling more than 27 GW. We have a full-service practice, advising in all aspects of the development, acquisition/disposition, construction, offtake, debt finance, tax equity finance, ownership and operation of renewable energy projects. We have also represented energy supply companies and other large energy consumers in connection with the structuring of physical and virtual power purchase agreements, power hedges, as well as environmental attribute purchase and sale agreements. 

Sustainable Finance: McGuireWoods’ securities and finance lawyers have significant experience advising leading banks and other clients on complex financing transactions, including impact investing, blended finance structures, structured sustainability-linked loans and green bond issuances. We advised a leading financial institution in connection with the issuance of a $2 billion bond designed to advance racial equality, economic opportunity and environmental sustainability — the first offering of its kind in the financial services industry. We recently represented an electric utility in connection with its syndication of a sustainability, diversity and inclusion-linked credit facility totaling $900 million, furthering its ongoing commitment to a sustainable future.

Derivatives: ESG-linked derivative products enable firms and companies to hedge risks associated with sustainable investments, including project risk, interest rate and currency risks. Our lawyers routinely advise clients — including major financial investment banks, commercial banks, alternative capital providers, publicly traded and private corporations, and private equity funds — in connection with a range of structural, legal and documentary considerations that arise in derivatives and structured finance transactions across all major asset classes.

ESG Trailblazers

Companies adapting to these new challenges will see their businesses change and grow, with the wider purpose of meeting myriad governmental goals, such as the United Nations’ Sustainable Development Goals or the United States’ commitment to reduce its greenhouse gas emissions by 50% from 2005 levels by the end of this decade. We partner with clients to seize opportunities and support their businesses through that growth. While clients can always benefit from individualized, one-on-one counseling on ESG issues, we also offer a confidential forum where they can share knowledge and discuss best practices with peers.

Our lawyers are involved from idea incubation, to execution, to evaluation. We provide a wealth of experience, much of which is borne from frontier markets, both in terms of location and in terms of industry. Our lawyers have been practicing in the multiple areas that now comprise what is called ESG for a number of years, and we are prepared to assist our clients with that collective wealth of experience irrespective of where they may be in their ESG journey.

Our ESG Experience

Blackstar Capital

  • as financier on portable solar power financing facility in Cameroon.

Developing World Markets

  • in the origination, placement and investment of proceeds from a first-of-its-kind off-grid, renewable and climate action (ORCA) note, which provided $60.8 million financing to 11 businesses promoting renewable energy and climate solutions across Latin America, Africa and Asia. 

Bank of America

  • in the issuance of a $1 billion corporate social bond to support the fight against the COVID-19 pandemic, the first such offering by a U.S. commercial bank.

CONSOL Energy

  • in its $2.5 million debt and equity investment in CFOAM, an Australian-based carbon material producer.

SeyCCAT

  • on World Bank funding documents for implementation of the World’s first blue bond.

African Development Bank

  • of $1 billion de-risking instrument relating to pan-continental African agricultural sustainable note issuance.
  • on agriculture de-risking instrument in Ghana, Morocco and Cote d’Ivoire.
  • on $200 million social development facility to a large Kenyan Bank, for regional expansion in Kenya.

Electric Utilities

  • in first-of-its-kind proceeding seeking approval of utility-scale battery energy storage systems, the largest of their kind in Virginia.
  • in the syndication of a sustainability, diversity and inclusion-linked credit facility totaling $900 million, furthering its ongoing commitment to a sustainable future.
  • in its issuance of a $1 billion green bond to finance existing and future eligible green expenditures.

Numerous Regulated Entities

  • represented clients with regard to regulation of greenhouse gases under the Clean Air Act, including in the landmark Supreme Court cases of Massachusetts v. EPA and Utility Air Regulatory Group v. EPA, and in D.C. Circuit litigation over EPA’s Clean Power Plan, the Affordable Clean Energy rule, and EPA’s regulation of methane from oil and gas facilities
  • lead client forum that assists companies with keeping abreast of ever-evolving ESG and other climate-related developments at the federal, state, international, and local levels, including monitoring litigation in this space and regulatory developments.

Publicly-traded and Private Companies

  • ongoing advice to numerous public and private companies regarding ESG disclosures and best practices and related corporate governance issues.

Advisory Roles

  • advisors to the European Commission on blue finance.
  • co-authors of the sustainable finance white paper for the UAE.

Team Leaders

Marc Naidoo

Partner

Full Team

Related Practices

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