Greening competition: a view from the U.S.

The Arizona state Attorney-General Mark Brnovich, in an Op-Ed published in the Wall Street Journal on March 6, 2022, announced that he would be investigating ESG activities as a violation of antitrust laws. In his view, ESG initiatives such as the Climate Action 100+ constitute "unlawful market manipulation" and "spurious political activism" resulting in "artificial restrictions on production" - particularly with respect to the energy sector.  

While the Arizona approach may seem out of step with the federal government's stated push on climate and ESG issues, this is not the first time federal and state actors have clashed over the antitrust implications of green initiatives. In 2019, the federal Department of Justice opened an antitrust inquiry into four major automakers that entered into an agreement with the state of California to reduce automobile emissions - an inquiry that was later shelved in 2020. And similar conflicts over competing state and federal agendas have risen to the surface with the proliferation of "energy discrimination" bills in a number of states. 

As lawmakers in Europe revisit competition regulations with a view to the green transition, and as the Biden administration continues to push forward with its climate and ESG agenda (including the long-awaited release of proposed disclosure rules from the SEC in March 2022), it remains to be seen when and how these tensions between federal and state actors responsible for antitrust regulation and enforcement will be resolved.