Environmental, Social & Governance (ESG)

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AN INTEGRATED AND HOLISTIC APPROACH TO SUSTAINABLE ESG

Environment, social and governance (ESG) perspectives – and how they interact – have rapidly become main drivers of societal changes for business, finance, politics and law. For our clients, ESG touches on their Licence to Operate and Purpose of Business, offering them great opportunities to distinguish themselves from competitors, and to strengthen their long-term policies and growth. Like many complex topics, the emerging legislation around sustainability at the same time requires careful and complex decision-making by our clients. We help clients in all sectors navigate this process by offering a cross-expertise approach - with experts who are leaders in their field and at the forefront of legal developments.

As an integrated team, we offer a holistic view - our experts can assess our clients' needs by anticipating legal changes for years to come. Our team knows how to deal with novel, complex, and often publicly scrutinised matters. This puts us in a unique position to handle ESG-related matters for companies, financial institutions, and major state-owned entities. Our central role in the European legal sector allows us to operate as a knowledge hub and to provide holistic and integrated advice that is fit for purpose and anticipates the future of sustainability law. We can achieve the best outcome in this multifaceted area when it comes to governance, projects, transactions, and public and private enforcement. This is how we help our clients take an advanced - but legally sound and defensible -stance on ESG.

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Environment: energy transition and climate change

Our climate change practice is unrivalled, having represented clients in precedent-setting climate litigation. In our role as trusted adviser to many energy companies, we have an extensive track record in litigating ESG aspects. Some examples include:

  • representing the Dutch State in investment arbitration proceedings initiated by RWE and by Uniper following the adoption of the Coal Ban Act
  • acting for NAM in litigation relating to earthquakes in Groningen by providing strategic, administrative, regulatory and civil law advice, including on mass claims
  • acting in injunction proceedings and follow-on litigation regarding the construction of Windpark De Drentse Monden en Oostmoer by successfully defending against collective actions to terminate the project
  • representing Shell plc in the first stage of unprecedented climate change litigation initiated by Milieudefensie in relation to Shell's GHG emissions

On an ongoing basis, we advise our clients on impending EU legislation on sustainable reporting and due diligence, and on the structure of their ESG policies. This requires a holistic and integrated approach to ensure that our clients' strategy, policies and governance are in alignment with their ESG-related targets and ambitions. Additional work includes antitrust advice on horizontal and vertical sustainability efforts, and on defence mandates against greenwashing claims. We also help our clients incorporate their ESG ambitions into their M&A and financing approach. We have, for example, acted as issuer counsel for multiple issuers of green and sustainability-linked bonds for Tennet, Gasunie and others.

Our work in the energy transition and restoration of biodiversity and ecosystems is unprecedented and takes a central position in the Dutch market. We have a longstanding track record in energy and environmental law (ranked tier 1 by all leading guides), having been at the forefront of all major developments, including in renewable energy (wind and solar); hydrogen; carbon capture, utilisation and storage; large-scale heat; and emission reduction and climate-related litigation.

Recent matters include:

  • acting for Schiphol, Lelystad, Rotterdam-The Hague and Eindhoven airports in proceedings under the Nature Conservation Act (nitrogen regulation)
  • advising on two new challenging and unique projects concerning hydrogen: the H2 Backbone (Gasunie) and HyTransPort.RTM (Gasunie and Port of Rotterdam) - both examples of the multidisciplinary service De Brauw delivers: advising on environmental, regulatory, procedural, M&A, financial and strategic aspects
  • assisting in the development of an unprecedented CCS infrastructure in the Port of Rotterdam (Porthos project), including advising on public law and planning/environmental aspects; the regulatory regime (including EU ETS impact); transactional aspects (such as setting up the joint venture); and commercial contracting
  • working on the new Aramis project
  • advising on the development of a new, large-scale heat transmission system (for Gasunie)
  • assisting on a multi-billion offshore wind-grid and onshore transmission development to deal with the enormous challenges of the energy transition
  • advising on the largest wind parks and solar parks in the Netherlands, both offshore and onshore
  • setting up a new nationwide system for e-waste recycling
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Social: human rights, equal treatment, and value chain due diligence

Our social justice track record is second to none. We advise and litigate in numerous unprecedented mandates on social justice, equal treatment, privacy, and human rights. Clients engage us to review their codes of conduct, human rights policies, and to advise on questions of social justice and equal treatment. This includes how to implement relevant obligations of means in our clients' due diligence policies. And when they face litigation, we stand ready to defend client interests.

As a selection of our work in the public sphere, De Brauw:

  • acted for two trade unions in parallel Permanent Court of Arbitration proceedings against Benetton and Takko in connection with the 2013 Accord on Fire and Building Safety in Bangladesh - an agreement between global brands and retailers and trade unions created in the aftermath of the Rana Plaza building collapse to establish a fire and building safety programme for workers in the textile industry. The unions took the view that Benetton and Takko were not performing their obligations under the Accord. The unions reached a USD 2.3 million settlement
  • represented, in the context of worker exploitation, Hungarian truck drivers against their employer; also represented FairWork in criminal litigation proceedings regarding worker exploitation
  • assist the Dutch entrepreneurial development bank FMO in a dispute with COPINH about FMO’s financing of a project in Honduras designed to provide clean and sustainable energy and to create jobs and benefits for local communities. COPINH initiated legal proceedings against FMO for financing this project, alleging that FMO as financier is liable for violations of human rights standards. These legal proceedings are still ongoing.

  • acted on behalf of a broad group of clients to hold the Dutch State liable for damage caused to many people for illegal sex change requirements. Until 2014, individuals could only change their registered sex if they agreed to certain things, including being permanently sterilised. This case goes to the heart of human rights, such as the right to respect for private and family life and the right to physical integrity
  • acted in proceedings on the costs of contraceptives, and argued that these should be covered by private health insurance. Sexual and reproductive health and rights were presented as fundamental human rights and an essential part of gender equality, self-determination and human dignity
  • De Brauw filed a complaint to the European Commission on behalf of WeMove Europe and Oxfam International for breaches of EU asylum law and fundamental rights by Greece.
  • is acting for Defence for Children in proceedings on the right to water and on children's rights

De Brauw is also acting in precedent-setting class actions involving privacy and data protection. Our work includes:

  • acting for PILP and a coalition of NGOs in unique proceedings against the sweeping "Wiv 2017" mass surveillance law (known as "Sleepwet"), which was voted down in a historic referendum in May 2018
  • assisting the Port of Rotterdam in a mass surveillance case
  • representing Salesforce in mass claim proceedings started by claim vehicle The Privacy Collective and relating to the alleged unlawful use of personal data
  • acting as counsel for Facebook in mass claim litigation for alleged data protection violations initiated by a claims foundation and the Dutch Consumer Association
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Governance and financial regulation

ESG touches the Purpose of Business of large corporates, as it plays a central role in the governance and success of our clients. De Brauw acts as boardroom adviser to a majority of large and listed Dutch companies, including financial institutions.

Our corporate advisory experts include holistic ESG considerations in their boardroom advice. This includes reviewing policies and strategic frameworks, and adapting to emerging ESG legislation. We also assist many clients with their ongoing stakeholder dialogue and activism, including shareholder resolutions on climate change and sustainability of operations.

Clients active in the financial sector especially face regulation that mobilises capital towards sustainable business, and potential enforcement by prudential supervising authorities. We assist our clients in meeting these challenges, rethinking their governance, integrating ESG in their risk management and other aspects of their business to secure sound and prudent business operations, putting transactions in place, and navigating litigation risks where needed.

Our recent work includes:

  • advising banks and asset managers on board responsibilities, and helping to ensure that regulatory and civil obligations are met
  • assisting several large pension funds and asset managers on their sustainable investment policies, and on the decisions they make in the face of public scrutiny
  • helping to translate ESG policies into investment management agreements and other material outsourcing contracts
  • advising financial institutions on their reporting obligations under the SFDR and Taxonomy Regulation

Insights

21 September 2022

Dutch competition authority willing to walk the talk on sustainability agreements

By publishing progressive guidance on sustainability agreements, the Netherlands Authority for Consumers & Markets (ACM) has cast the spotlight on the role of competition law in promoting sustainability. Now its practical approach is beginning to reap dividends. Businesses are stepping forward to discuss pro-sustainability initiatives with the ACM where its guidelines are applied. Recently, the ACM declared that an initiative between soft drink suppliers to remove plastic handles and an initiative by garden centres to curtail their suppliers' use of illegal pesticides was not anti-competitive. On the other hand, while the ACM considered a joint marketing initiative for CO2 storage facilities to constitute a restriction of competition, it allowed the collaboration because the sustainable benefits out-weighed the anti-competitive effects. In addition to developing unilateral ESG initiatives, these real-life cases demonstrate opportunities for market participants to conclude sustainability agreements with their competitors.
26 July 2022

New remuneration rules for financial enterprises in the Netherlands

On 1 January 2023, the Financial Markets Supervision Act will change, introducing a new scheme on remuneration at financial enterprises (such as banks and insurers). The new scheme includes a five-year statutory retention period for shares and other financial instruments that managing directors or employees receive as part of their fixed pay. In their remuneration policies, financial enterprises will also have to account for the relationship between the remuneration of their directors and employees and their social function. The new legislation includes a transitional regime. We describe the key features of the new law below.
20 April 2022

Netherlands introduces new access to public information regime

The Open Government Act (Woo) will enter into force on 1 May 2022, replacing the current law (Wob). The aim of the new law is to create a more transparent government that actively discloses information. The changes contained in the new law, especially in terms of active disclosure, are a significant departure from the current regime, where information has been mostly disclosed on request. That is not the only change though: there will be new exceptions to disclosure, a shorter decision-making period, and a central platform where all information is made public. In addition, the new law will apply to a wider range of public authorities. Under the new act, private companies will be asked more often to respond to intended disclosures. The new regime will not only apply to new documents, but also for documentation which is already in the possession of administrative bodies.