Disney-DeSantis Fight Tests Boundaries of Corporate ESG Push
The Walt Disney Co. lawsuit against Florida Gov. Ron DeSantis is being closely watched by companies as a harbinger of how far government officials can go to rein in corporate environmental, social and governance strategies.
Disney is alleging the Republican governor retaliated against the company for its opposition to a state law which broadly prohibits classroom instruction of sexual orientation or gender identity, in an April 26 lawsuit. DeSantis sought to exert control over the special-purpose land use contract the company uses for its sprawling Disney World resort in response to the company s criticism.
The legal battle is about more than the degree of control Disney can exercise over its Florida theme parks and resorts, corporate law professors say. It s a clash over implementing ESG principles that have engulfed corporate America, amid opposition from conservative government officials, including DeSantis, who have started moving against them.
A DeSantis victory could have a chilling effect on companies ESG polices, said Dorothy Lund, corporate governance professor at the University of Southern California.
This should trouble conservatives and liberals alike, Lund said. You don t want companies to feel like they can t make profit-maximizing ESG choices because they are worried that they will be vulnerable to retaliation from a red state.
Normally anything that should trouble conservative and liberals alike should only trouble liberals. As to “profit-maximizing ESG choices,” I don’t think there are any, or many anyway. This would be a good topic for a law professor to write about on the anti-ESG side, except that they would not be able to get it published.