Sustainability

Overview

In the ever-evolving global marketplace, consumers, investors, and employees are increasingly demanding that businesses consider sustainability and be transparent in reporting their sustainability practices. But one size does not fit all, and businesses must determine which sustainable practices and reporting mechanisms are best suited to their organizations.

Richards, Layton & Finger is positioned to help Delaware business entities with issues relating to Delaware’s new sustainability disclosure legislation. We were involved in the drafting, review, and commenting on the new legislation, which establishes a voluntary certification process enabling Delaware business entities to earn the Delaware Certificate of Adoption of Transparency and Sustainability Standards verifying their sustainability activities. The certification process does not prescribe specific standards or criteria for sustainability. Instead, any business seeking the certification adopts its own principles, guidelines, and standards that guide its business activities in a sustainable and responsible manner, as well as metrics for assessing whether it has met its own objectives.

Richards Layton stands ready to assist companies through the process of earning the Delaware Certificate and related matters.


Frequently Asked Questions

Q. What is the Delaware Certificate of Adoption of Transparency and Sustainability Standards?
A. The Delaware Certificate is a certification by the Delaware Secretary of State that a submitting entity has met the statutory requirements regarding disclosure of its sustainability efforts.

Q. What are the requirements to obtain a Delaware Certificate?
A. Submission of a Standards Statement to the Secretary of State, and payment of fees and costs.

Q. What is a Standards Statement?
A. The Standards Statement is an acknowledgement by the entity that:

  • The entity’s governing body has adopted resolutions setting forth the entity’s sustainability standards and assessment measures.
  • Identifies a link on the entity's principal website that is easily accessible, free to the public, and contains the standards and assessment measures the entity is using, the third-party criteria used to develop the standards, a description of the process that led to the development of the particular standards approved, and any report filed.
  • The entity has agreed to deliver to the Secretary of State within 30 days a copy of its most recent report.
  • For each reporting period, the entity commits to (i) use the assessment measures that its board approved, (ii) review its standards and assessment measures and make changes as necessary, and (iii) make public via internet link a copy of its report within 90 days of the end of each reporting period.
  • It has provided the Secretary of State with an address in Delaware for mailing purposes.
  • The Standards Statement was acknowledged by an authorized person.

Q. How much does it cost to file a Standards Statement and obtain a Delaware Certificate?
A. Up to $200, as determined by the Secretary of State, to file the Standards Statement, and $50 for the original certificate, and $50 for each subsequent certified copy of the statement.

Q. What does the report need to include?
A. The report must include:

  • A summary of the standards and assessment measures that the entity is using, including any third-party criteria or other sources used to develop them, as well as the process used to identify and develop which standards and assessment measures to select.
  • A summary of the entity’s actions to achieve its standards during the relevant reporting period.
  • Performance data as to how the entity is doing using its own performance measures. The report must also include a summary of efforts that will be undertaken to improve areas where the entity is not meeting its own standards.
  • The identity of any sustainability consultants or professionals used to measure the entity’s business against its standards or, if none, a statement to that effect.
  • A summary of any changes made to its standards or assessment measures, the process by which those changes were made, and any third-party criteria used to make those determinations.
  • A summary of the actions planned for the next reporting period if those actions will be materially different than the current ones.
  • A copy of any report or assessment relating to environmental or social impact submitted to a sustainability professional to the extent not already included.

Q. How do I renew my certification?
A. File a Renewal Statement with the Secretary of State between October 1 and December 31 of each year.

Q. What does the Renewal Statement need to contain?
A. The Renewal Statement must contain:

  • Acknowledgement that any changes made to its standards, assessment measures, or Delaware address since its last filing are available on the website.
  • Acknowledgement that for the most recent reporting period, a report was made available on the entity’s website.
  • An internet link to the report for its most recent reporting period.
  • Acknowledgement by an authorized person.

Q. What happens if I fail to file a Renewal Statement between October 1 and December 31?
A. Your entity will become a non-reporting entity as of January 1.

Q. How can I get back in good standing after I’ve fallen out of compliance?
A. File a Restoration Statement anytime within the calendar year following your failure to file a Renewal Statement. You will automatically become a reporting entity upon filing of the Restoration Statement.

Q. What does the Restoration Statement require?
A. The Restoration Statement requires:

  • Acknowledgement that any changes made to its standards, assessment measures, or Delaware address since its most recent Renewal Statement or Standards Statement was filed, and a description of the process used to decide upon those changes.
  • Acknowledgement that a report was made public for all reporting periods that ended prior to 90 days before the Restoration Statement is filed.
  • An internet link to the most recent report and any reports for prior reporting periods that were not made.
  • Acknowledgement by an authorized person of the entity.

Q. What do I do if my report contains sensitive business information that should not be made public?
A. The law specifically creates an exception that an entity is not required to include any information in the report that is (i) protected by the attorney-client privilege, or (ii) a trade secret or competitively sensitive information.

Q. Can I make my certificate public?
A. Yes, you are specifically authorized to disclose that the entity has obtained a Delaware Certificate.

Q. Am I liable for failure to obtain a Delaware Certificate?
A. No, the Delaware Certificate is optional.

Q. Am I liable if I obtain a Delaware Certificate and then fail to meet the standards my entity has adopted?
A. There is an express limitation of liability for any entity for actions or omissions made in connection with the Delaware Certificate.

Q. When can I start? I’d like to obtain my Certificate as soon as possible.
A. October 1, 2018.

Publications

  • "Governor John Carney Signs Delaware's Innovative Voluntary Sustainability Certification Act into Law," June 28, 2018   View >