The current developments in the world and the resulting challenges mean that we must all adapt and make changes for a more sustainable society. This applies particularly to companies, which will increasingly be subject to stricter regulations regarding their work in the field of ESG, in other words Environmental, Social and Governance.
The stricter regulations, in combination with developments in the world and the greater demands placed on different operators, mean that ESG matters are an increasingly important factor in strategic business decisions and companies’ ESG work forms an increasingly important part of the business as a whole.
NAVIGATING THE ESG JOURNEY
The European Green Deal is a package of policy initiatives aimed at contributing to a green transition in the EU. The ultimate goal is for Europe to be the world’s first climate-neutral continent by 2050. Within the framework of the Green Deal, the EU has produced a comprehensive legislative package containing requirements for companies’ ESG work that are stricter in various ways. The legislation is complex in many cases and will pose major challenges.
Navigating new complex legislation while maintaining focus on profitability and growth is difficult. Lindahl’s lawyers can contribute both experience and expertise in that regard.
HOW LINDAHL IS ABLE TO SUPPORT SUSTAINABILITY WORK
The Lindahl sustainable business team is made up of lawyers with a wide range of expertise. They all have a genuine interest in sustainability and an understanding of the business law aspects to be considered in successful ESG work and how such considerations can lead to new business opportunities in both the short and the long term. At Lindahl, our services include helping your business to:
- Identify the most beneficial sustainability work in business terms in order to increase your company's value with its key stakeholders, based on existing operational and financial targets.
- Improve supplier agreements and policies to ensure compliance with ESG standards throughout the value chain.
- Develop transaction strategies to increase the sustainable part of the business through acquisitions.
- Carry out ESG due diligence in corporate acquisitions.
- Develop and implement evaluation models that provide boards of directors and managements with comprehensive supporting data for decisions on strategic business focus and product development.
- Support the introduction of environmentally sustainable projects within the framework of existing environmental legislation.
- Introduce and manage a complete whistleblowing system in accordance with the Whistleblower Act.
- File claims for damages due to so-called greenwashing.
- Increase knowledge of sustainable procurement in order to meet the requirements of the public sector, for example.
Frequently asked questions:
Why should companies take an interest in the field of ESG?
Being involved and contributing to a more sustainable future is important to today’s companies from both a motivational and a business perspective – motivation for the employees and development of business models. Not to mention everyone’s communal responsibility for positive development. The regulations will be introduced and will require companies to be involved in developing European societies in the direction of climate neutrality. There is therefore tremendous value for companies in acting and developing their business in a way that provides competitive advantages and creates value for society as a whole.
Which companies are primarily subject to current and future regulations in the field of ESG?
The regulations are primarily aimed at large companies that are responsible for regulatory compliance in their capacity as juridical persons. However, smaller companies will also be affected indirectly and, even if they are not affected by any legislation, there are still good reasons for developing business in such a way that it falls into line with current and future ESG regulations.
Can a company have sanctions imposed on it if it fails to meet sustainability requirements in Sweden and the EU?
Yes. The type of sanction depends on the regulations in question. It may involve fines, damages or financial penalties, for example. As far as EU legislation is concerned, the Member States designate national supervisory authorities to control compliance and, where appropriate, adopt decisions on sanctions. The sanctions in question can often involve high amounts and, added to that, there is a negative impact on the brand, which probably entails even greater damage than the amount of the sanction itself.
How far is a company responsible for sustainability work by its suppliers or other operators in the value chain?
Choosing suppliers and parties to agreements with care and taking a range of sustainability factors into consideration forms part of companies’ sustainability work. From that point of view, it may be said that the responsibility extends beyond the company’s own activities. The draft CSDD directive also proposes that companies should continuously carry out what are referred to as due diligence processes in their value chains in order to identify and, where appropriate, work on companies’ negative impact on human rights and the environment. Different operators’ sustainability work is therefore likely to become even more integrated in future.