Skip to content

menu

Greenberg Traurig, LLP logo
HomeContact UsEuropeAsiaLatin AmericaEnvironmentalEnergy
Search
Close

E2 Law Blog

Insights and Commentary on Global Environmental and Energy Issues

Home » Environmental Sustainability Is Fashionable, But New Bill Presents Hurdles to Industry

Environmental Sustainability Is Fashionable, But New Bill Presents Hurdles to Industry

Retail_Proposal
By Zackary D. Knaub, Laura Siegel Rabinowitz & Jane McLaughlin on January 13, 2022
Posted in Environmental, Environmental Social & Governance (ESG), Featured, GT Alert, New York, Sustainability

On the heels of Gov. Kathy Hochul’s State of the State address, in which she endorsed a suite of progressive environmental policies including product stewardship laws governing the paper and packaging industry, the New York Legislature has introduced a bill targeting environmental sustainability disclosures in the fashion and apparel industry. The Fashion Sustainability and Social Accountability Act (A.8352/S.7428) would require fashion retailers and manufacturers to disclose environmental and social due diligence policies and allows citizen lawsuits to enforce the terms of the proposed legislation.

Environmental, Social and Governance (ESG) measures have become au courant in a wide range of industries, and “greenwashing” – the conveyance of a false impression of environmental sustainability practices – poses risk to businesses and the public. As the 2022 legislative session moves into full swing, lawmakers have targeted ESG practices in the apparel industry with the Fashion Sustainability and Social Accountability Act, which would require fashion retailers to disclose the environmental and social impacts of their business practices. Specifically, every fashion retailer or manufacturer operating in New York and having worldwide gross receipts exceeding $100 million would be required to disclose their environmental and social “due diligence” policies throughout the supply chain. “Due diligence” policies refer to the mitigation strategies to address adverse impacts recommended by the Organisation for Economic Co-operation and Development and the United Nations guiding principles for business and human rights. Covered retailers would be required to disclose their due diligence practices on their website within a year of enactment of the bill.

As ESG practices have proliferated over the past several years, environmental sustainability has become a cornerstone of manufacturer and retailer marketing efforts. The bill would require that covered retailers identify greenhouse gas emission, water, and chemical management reduction targets within 18 months of enactment of the due diligence policies.

In addition, retailers would have to account for the use of recycled materials in their products and disclose how median wages for prioritized suppliers compare to local minimum wage and living wages. The bill would further require fashion retailers and manufacturers to map at least 50% of their supply chains, from raw materials to vendor and shipping information. Annual volume of material type produced – for example, polyester, cotton, or leather – and median worker wages would also be required. All of that information would be made available online. Two major concerns for fashion companies would be the onerous reporting requirements and the typically confidential supply chain information which, the language of the bill suggests, would be publicly available without any exemption for confidential information or trade secret protection.

Both the attorney general and citizens would be able to enforce the proposed law. The attorney general would be able to seek up to 2% of revenues of $450 million or more from companies that violate the law, and any citizen would be able to file suit against a noncompliant retailer or seek to compel the attorney general to investigate noncompliance and enforce the proposed law. The fines would be deposited into a community benefit fund to be used towards projects benefiting environmental justice communities.

Similar laws have proven problematic in states such as California, where citizen enforcement has given rise to an industry of plaintiffs’ attorneys and litigation over environmental disclosures has become commonplace. At the same time, the rise of ESG policies without regulation poses risks to consumers and market participants. Whether this bill strikes the policy balance that New York lawmakers want remains to be seen. The fashion, apparel, and retail industry should keep a close eye on this bill during the 2022 legislative session, given the litigation and business risks it poses, including potential supply chain disruptions and disclosure of confidential trade secrets.

Tags: Environmental Social and Governance (ESG), ESG, greenwashing, GT Insight, New York, retail, supply chain, sustainability
Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Zackary D. Knaub Zackary D. Knaub

Zackary D. Knaub brings deep New York government experience to his Environmental and Government Law & Policy practices. Prior to joining Greenberg Traurig, Zackary served as Interim Chief Counsel and First Assistant Counsel to Governor Andrew M. Cuomo, and before that, as Assistant…

Zackary D. Knaub brings deep New York government experience to his Environmental and Government Law & Policy practices. Prior to joining Greenberg Traurig, Zackary served as Interim Chief Counsel and First Assistant Counsel to Governor Andrew M. Cuomo, and before that, as Assistant Counsel to the Governor for Energy and the Environment. In these roles, Zackary advised Governor Cuomo and his administration on all legal issues related to executive actions, policies, and legislative initiatives. He coordinated the legal affairs and operations of over 100 State Executive Agencies, State Authorities, Public Benefit Corporations, and boards, and oversaw the day-to-day operations of the Office of the Governor’s Counsel. Zackary managed the development and negotiation of major legislation and gubernatorial initiatives. He supervised negotiations of all legislation in the Governor’s annual $175 Billion state budget and managed outside counsel in litigation. His public relations experience includes advising press and operations staff on crisis management strategies and public messaging of complex legal and policy initiatives.

Zackary has also defended and prosecuted environmental and commercial cases in state and federal courts, and before administrative tribunals, arbitration panels, and mediators for a wide range of businesses in areas of law including federal and state environmental laws, intellectual property, Federal Acquisitions Regulations, employment law and policy, insurance coverage, and environmental risk management.

Read more about Zackary D. Knaub
Show more Show less
Photo of Laura Siegel Rabinowitz Laura Siegel Rabinowitz

Laura Siegel Rabinowitz counsels domestic and multinational businesses on complex supply chain issues and other complicated challenges associated with trade, advising on mitigation of duty exposure and compliance. Laura has deep experience handling international trade projects for clients, including multinational importers, exporters, manufacturers…

Laura Siegel Rabinowitz counsels domestic and multinational businesses on complex supply chain issues and other complicated challenges associated with trade, advising on mitigation of duty exposure and compliance. Laura has deep experience handling international trade projects for clients, including multinational importers, exporters, manufacturers, retailers, customs brokers, and freight forwarders.

Laura advises clients on mitigating tariffs on Chinese-made products and steel and aluminum and helps clients navigate the maze of regulations, customs, and other government agency scrutiny, as well as the broad array of commercial and enforcement laws and policies administered by U.S. Customs and Border Protection, including trade compliance and audit programs, and duty savings initiatives such as free trade agreements and the use of “first sale.” Laura’s practice also includes advising on the enforcement of antidumping and countervailing duties.

Read more about Laura Siegel RabinowitzLaura's Linkedin Profile
Show more Show less
Photo of Jane McLaughlin Jane McLaughlin

Jane McLaughlin has extensive governmental and legislative experience, having served as Director of Legislative Affairs in the New York Department of Environmental Conservation, Legislative Counsel in the New York State Department of Health, and as Legislative Counsel and Committee Director in the New…

Jane McLaughlin has extensive governmental and legislative experience, having served as Director of Legislative Affairs in the New York Department of Environmental Conservation, Legislative Counsel in the New York State Department of Health, and as Legislative Counsel and Committee Director in the New York State Senate. Jane has also served as counsel to the New York State Conference of Mayors and Municipal Officers (NYCOM), working on various matters pertaining to municipal government. She has worked on a wide variety of matters and legislation, including matters involving the environment, health care, procurement, telecommunications, election law, and water/sewer law.

Read more about Jane McLaughlin
Show more Show less
Related Posts
Sustainable habitat Map of New York, Environment -Shutterstock_2201338381
New York Adopts New Environmental Justice Law That Requires Consideration of ‘Disproportionate Impacts’ on Disadvantaged Communities for Permit Issuance and Renewal
January 18, 2023
New York State Capitol Building, Albany
The New York State Capitol Building in Albany, home of the New York State Assembly.
New York State Climate Action Council Adopts Final Scoping Plan to Achieve Climate Goals
December 19, 2022
kaitlyn maxwell city and state
Kaitlyn R. Maxwell Recognized as a City & State PA ‘2022 Impact 50’
December 15, 2022

Stay Connected

Subscribe to this blog via RSS Follow GT on Twitter Join the Discussion on Facebook View GT's LinkedIn Profile
Subscribe

Jan. 19 | David Mandelbaum, Steve Russo to Present at NYSBA Annual Meeting: Environmental & Energy Law Section CLE

January 19, 2023 Greenberg Traurig's David Mandelbaum and Steve Russo to Present at NYSBA Annual Meeting: Environmental & Energy Law Section CLE

Listen to our E2 Law Podcast for insights and commentary on global environmental and energy issues.

  Announcements

  • Uncertainty, No Guidance for Attorney-Client Privilege in Environmental Audits
  • Law360 Pulse | ‘Enviro Atty Returns To Greenberg Traurig’

Tweets by @GT_Law

Tweets by @GT_Law

About Us

GT’s Environmental Practice is one of the largest and geographically broadest environmental groups of any law firm based in the United States. Our client-focused, problem-solving approach reflects the commitment to service that has led major national companies in a variety of industry segments.

Read More....

Blog Authors Show/Hide

  • Jorge Aleman Juarez
  • Tiffany M. Andras
  • Jillian Askren
  • Steven Barringer
  • Kerri Barsh
  • Christopher Bell
  • Marijn Bodelier
  • Kara M. Bombach
  • Nicolas Borda
  • Martin Borning
  • Lynelle Bosworth
  • Laura Bottaro
  • Cyril T. Brennan
  • Thomas R. Brill
  • Caitlyn E. Jones
  • Deirdre A. Carson
  • Greenberg Traurig
  • Rubén Alejandro Ortiz Cervera
  • Jeffrey A. Chester
  • John V. Chibbaro
  • Jacomijn Christ
  • Francesca Ciliberti-Ayres‡
  • Frank Citera
  • Joshua Cohen
  • Michael Cooke
  • Sonali Dohale
  • Hayley Easton
  • Troy A. Eid
  • John Eliason
  • Robert C. Epstein
  • Luigi Fontanesi
  • Robert Freund
  • John Gao
  • Maria C. Garcia˘
  • William Garner
  • Jack Gearan
  • Juan Manuel González Bernal
  • Nancy Guillén Espinosa
  • Jennifer M. Gómez
  • Hamilton Hackney III
  • Caitlyn E. Haller
  • Dr. Martin Hamer
  • Candace Headen Uduebor
  • Greenberg Traurig
  • Genus Heidary
  • Elizabeth B. Herdes
  • Jan Herfkens
  • Erick Hernández Gallego
  • Rob Herrington
  • Edward S. Hershfield
  • Caleb Holmes
  • Richard Hughes
  • William Hurst
  • David C. Jense
  • Barbara A. Jones
  • Laura E. Jones
  • Sandra K. Jorgensen
  • Rabeha Kamaluddin
  • Todd Kaminsky
  • Barbara T. Kaplan
  • Harris L. Kay
  • Julie Kendig-Schrader
  • Greenberg Traurig, LLP
  • April B. Kim
  • Jillian Kirn
  • Marvin A. Kirsner
  • Aaron S. Klein
  • Zackary D. Knaub
  • Natalie Kopplow
  • Joanna Kuc
  • James O. Lang
  • Gregory K. Lawrence
  • Jack LeBris Erffmeyer
  • Thomas O. Lemon
  • Lauren A. Liss
  • David Mandelbaum
  • Robert Mangas
  • John L. Mascialino
  • Kaitlyn R Maxwell
  • Harriet McConnell
  • Jane McLaughlin
  • Graeme McLellan
  • Peter Mezey
  • Kenneth M. Minesinger
  • Mike Mirdamadi
  • Samuel L. Moultrie
  • Michael G. Murphy
  • Edwin J. Nazario
  • Samir NeJame
  • Howard L. Nelson
  • Christopher J. Neumann
  • Daniell K. Newman
  • Glenn Newman
  • Grant E. Nichols
  • Maribel Nicholson-Choice
  • Hazel Ocampo
  • Pablo Ortiz Mena Montes de Oca
  • Evan Preminger
  • Laura Siegel Rabinowitz
  • Jared Raleigh
  • Bernadette M. Rappold
  • Katie P. Reed˘
  • Pedro Javier Reséndez Bocanegra
  • Craig V. Richardson
  • Braxton Roam
  • Adam Roseman
  • Robert M Rosenthal
  • Steven C. Russo
  • Alessio Gerhart Ruvolo
  • Doreen U. Saia
  • Hector D. Sanchez Fernandez
  • Monisha Sardjoe
  • Andrew W. Scher
  • Sabine Schoute
  • Paul M. Seby
  • Cate Sharp
  • Casey A. Shpall
  • Sylvia Simson
  • Keith E. Smith
  • Greg Sperla
  • Meital Stavinsky
  • Libretta Stennes
  • Tim Swickard
  • Michael T. Taylor
  • Robert S. Thompson IV
  • Christopher Thorne
  • Matthew K. Tieslau
  • Curtis B. Toll
  • Christopher Torres
  • Rodrigo Vazquez del Mercado-Rivera
  • Marlis Vázquez Egli
  • Margaret J. Weil
  • Philip R. Weingold
  • David B. Weinstein
  • Lilian Welling-Steffens
  • Christopher R. White
  • William Wu
  • Dawn Zhang
  • Erik de Bie
  • Marie-José van der Heijden

TOPICS

ARCHIVES

GT Law Blogs

Recent Posts

  • Uncertainty, No Guidance for Attorney-Client Privilege in Environmental Audits
  • Law360 Pulse | ‘Enviro Atty Returns To Greenberg Traurig’
  • Inflation Reduction Act: EPA Invites Stakeholder Input on Grant/Technical Assistance Programs for Lower-Embodied Carbon Construction Materials, Standards
  • E2 Law Podcast: Episode 20 | Empire Environmental – Review of New York’s Cap-and-Invest Program to Reduce Emissions and Achieve Climate Goals
  • New York Adopts New Environmental Justice Law That Requires Consideration of ‘Disproportionate Impacts’ on Disadvantaged Communities for Permit Issuance and Renewal

GT Blogs

  • EB-5 Insights
  • Florida From the Ground Up
  • Global Trade Monitor
  • GT Israel Law Blog
  • GT LE Blog
  • Hospitality Law Check-In
  • Immigration Compliance

E2 Law Blog

Greenberg Traurig, LLP logo
Subscribe to this blog via RSS Follow GT on Twitter Join the Discussion on Facebook View GT's LinkedIn Profile
Privacy PolicyDisclaimer

About Greenberg Traurig: Greenberg Traurig, LLP has more than 2650 attorneys in 44 locations in the United States, Europe, Latin America, Asia, and the Middle East. The firm is a 2022 BTI “Highly Recommended Law Firm” for superior client service and is consistently among the top firms on the Am Law Global 100 and NLJ 250. Greenberg Traurig is Mansfield Rule 5.0 Certified Plus by The Diversity Lab and is recognized for powering its U.S. offices with 100% renewable energy as certified by the Center for Resource Solutions Green-e® Energy as a member of the U.S. EPA’s Green Partnership Program. The firm is known for its philanthropic giving, innovation, diversity, and pro bono. Web: www.gtlaw.com.

Copyright © 2023, Greenberg Traurig, LLP. All Rights Reserved.
Law blog design & platform by LexBlog LexBlog Logo