Companies must stay agile in monitoring developments and rulemaking on the ESG implications of AI. By Betty M. Huber and Michael H. Rubin Artificial intelligence (AI) has become an indispensable tool, but with the rapid advancement in the technology has come a rise in electricity demand, drawing regulatory attention on the natural resources that AI requires. Within this context, companies and policymakers are considering how AI may contribute both to sustainable solutions and environmental impacts. For companies that have committed to environmental targets and are simultaneously advancing AI ..read more

The CSDDD is set to impose mandatory human rights and environmental due diligence obligations for in-scope companies. By Paul A. Davies, Michael D. Green, and James Bee On 5 July 2024, the Corporate Sustainability Due Diligence Directive (CSDDD) was published in the Official Journal of the EU, marking a significant milestone in the growing regulatory environment in relation to companies being required to embed responsible business conduct into due diligence processes and policies. Initially proposed in February 2022, the CSDDD aims to create a comprehensive due diligence framework across the ..read more

The Standards provide a framework for all Chinese companies’ sustainability disclosures and the applicability extends beyond listed companies. By Paul A. Davies, Farhana Sharmeen, Michael D. Green, James Bee, and Qingyi Pan On May 27, 2024, China’s Ministry of Finance published the new Corporate Sustainability Disclosure Standards (Draft for Comment) (the Standards). The Standards set out the general provisions, disclosure objectives, and information quality requirements, which aim to lay the ground for China’s unified national sustainability disclosure standard system, expected to launch by ..read more

Finch v. Surrey calls for assessment of all likely direct and indirect environmental effects in EIAs, including certain Scope 3 emissions if a reasonable estimate is feasible. By Paul A. Davies, Michael D. Green, Stephanie Forrest, and James Bee On 20 June 2024, the UK Supreme Court (the Court) in Finch v. Surrey CC [2024] UKSC 20 considered whether certain downstream emissions fell within the scope of direct or indirect environmental effects for the purposes of an Environmental Impact Assessment (EIA) for the proposed development of an oil well site. On the facts of the case, a 3-2 majority ..read more

Private capital providers, investors, asset managers, and financial institutions will likely continue to face a fragmented regulatory landscape on ESG matters. By Betty M. Huber, Matthew Green, Henry Miller, Austin J. Pierce, Catherine G. Willis, and Sam Wong Various US states have taken and continue to take action on ESG investing and other matters, with new variants emerging regularly. Some of the state bills, laws, and actions overlap thematically, and indeed some are based on common model bills. However, there are sufficient differences among them — and the politics and politicians underl ..read more

Denmark’s unprecedented carbon removals fund has facilitated the coexistence of corporate and national carbon claims in carbon accounting. By Jean-Philippe Brisson, Paul A. Davies, Lars Kjølbye, John-Patrick Sweny, and Qingyi Pan In the past few years, stakeholders in the carbon market have debated how to integrate the voluntary carbon market (VCM) and the emerging international carbon market governed by the Paris Agreement — Denmark’s recent move to allow stacking of voluntary carbon credits and nationally determined contribution (NDC) offers a promising solution. This approach, already supp ..read more

The key principles for a Carbon Management Strategy and draft act on the revision of the Carbon Storage Act create new opportunities for investors and project developers. By Tobias Larisch, Alexander “Stefan” Rieger, John-Patrick Sweny, Jean-Philippe Brisson, and Joachim Grittmann The German Federal Government’s Carbon Management Strategy and the revision of the Carbon Storage Act (Kohlendioxid-Speicherungsgesetz, KSpG) aim to remove current obstacles to (i) Carbon Capture and Storage (CCS) and (ii) Carbon Capture and Utilisation (CCU) in Germany and to set guard rails for using these technol ..read more

The joint policy statement and principles provide integrity standards for carbon credits that both the US government and participants in the voluntary carbon market should aim to follow. By Jean-Philippe Brisson, Michael Dreibelbis, Tal Carmeli, and Phil Goldberg On May 28, 2024, the Biden Administration released the Voluntary Carbon Markets Joint Policy Statement and Principles for Responsible Participation in Voluntary Carbon Markets (the VCM Policy). The VCM Policy is co-signed by US Secretary of the Treasury Janet Yellen, US Secretary of Agriculture Tom Vilsack, US Secretary of Energy Jen ..read more

The Tribunal confirmed that States party to UNCLOS must take measures to prevent marine pollution caused by climate change, on top of their obligations under the Paris Agreement. By Paul A. Davies, Sophie J. Lamb KC, Michael D. Green, and Stephanie Forrest On 9 April 2024, the International Tribunal on the Law of the Sea (ITLOS, or the Tribunal) issued a long-awaited advisory opinion on climate change and international law, concluding that States party to the United Nations Convention on the Law of the Sea (UNCLOS) are subject to specific obligations to prevent, reduce, and control greenhouse ..read more

EPA will regulate legacy CCR surface impoundments and CCR Management Units for the first time. By Stacey L. VanBelleghem, Karl A. Karg, Phil Sandick, Jacqueline Zhang, Bruce Johnson, and Samuel Wallace-Perdomo This post is the second in a series on four key power plant rules that the Environmental Protection Agency recently released. It discusses the rule on requirements governing disposal of coal combustion residuals at inactive power plants. On April 25, 2024, EPA released its Final Rule to extend certain requirements governing the disposal of coal combustion residuals (CCR) in inactiv ..read more