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Companies’ legal exposure to greenwashing claims set to rise

Absence of a unified definition of greenwashing, evolving regulatory developments and “greenwashing by association” complicate management of the threat

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Michelle Quah

Michelle Quah

Published Mon, May 15, 2023 · 05:50 AM
    • The breadth of the potential greenwashing claims that can be brought against a company - ie. the potential scope of liability and the extent of possible legal grounds for a claim - will continue to increase, says Baker McKenzie. PHOTO:
    • The breadth of the potential greenwashing claims that can be brought against a company - ie. the potential scope of liability and the extent of possible legal grounds for a claim - will continue to increase, says Baker McKenzie. PHOTO: BT

    COMPANIES’ exposure to accusations of greenwashing is set to continue rising, and with it the risk of regulatory action, civil claims and reputational damage, lawyers told The Business Times.

    Underpinning that trend are the growing demand for more environmentally friendly offerings from corporates, escalating competition for green financing and deepening scrutiny from stakeholders and regulators.

    Complicating how companies manage this growing threat is the current lack of a unified definition of what constitutes greenwashing, still-developing rules and laws, and the growing consensus that greenwashing does not need to be intentional to be deemed as such.

    ESGClimate-related financial disclosuresgreenwashingBusiness risks

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