Photo of Melissa Eaves

Melissa Eaves is special counsel in the White Collar Defense and Corporate Investigations Practice Group in the firm's Los Angeles office.

The idea that investors might choose to consider certain environmental, social, and governance factors when deciding whether to buy shares of a company—a concept commonly known as ESG—continues to gain popularity with trillions of dollars currently held in investment funds that take into account ESG principles. Yet recently, the use of ESG investment measures has been the target of intense scrutiny and political pushback that threatens to produce inconsistent regulation and enforcement approaches at the federal, state, and local levels. The United States Securities and Exchange Commission (“SEC”), for example, has focused on ESG by investigating and taking action against companies that tout business practices such as consideration of environmental sustainability, but fail, in practice, to live up to their claims. In contrast, a number of state governors, legislatures, and attorneys general have passed laws or issued cease-and-desist-type letters to stop or discourage companies from considering ESG factors, in whole or in part, when making investment decisions. These varied and seemingly conflicting approaches to ESG can easily create a conundrum for companies that have incorporated or are seeking to incorporate ESG initiatives into their operations. When dealing with ESG, businesses today face the difficult task of determining how best to implement ESG-based policies, procedures, and practices, while mitigating the risk that such actions may draw the ire of officials and regulators who view the consideration of ESG factors in investment decisions to be a breach of the fiduciary duty to prioritize return on investment over non-financial considerations.Continue Reading An Evolving High-Wire Act: Navigating Conflicting Laws, Regulations, and Guidance in the ESG Space

A CEO receives an anonymous call claiming that someone is stealing company trade secrets or that an employee is taking kickbacks from a vendor.  A GC gets a call from the HR director who has an employee accusing the company of submitting false bills to a government agency.  You are served by a government agency with a subpoena seeking records indicating a criminal investigation is underway for violations of environmental laws, insider trading, tax laws or fraud. Your company receives a credible threat of litigation.  These are all real scenarios that occur daily in companies of all sizes all over the world.  They trigger critical internal investigations that require substantial time and resources.  Regardless of the nature of the investigation, it is vital that it be conducted efficiently, with clear direction and attention to preservation of the attorney-client privilege.  This article sets out best practices for doing so.
Continue Reading Corporate Internal Investigations: Best Practices