Fiduciary Duties in the Era of Greenwashing: A Critical Analysis of Director Liability under the EU Corporate Sustainability Due Diligence Directive

In the wake of escalating climate crises and rising investor demand for sustainable practices, greenwashing has emerged as a major systemic risk in corporate governance. This article examines the transformation of directors' fiduciary duties under the newly enacted EU Corporate Sustainability Due Diligence Directive (CSDDD). Specifically, it analyzes how the directive redefines the traditional duties of care and loyalty, shifting corporate decision-making from a shareholder-centric model to a stakeholder-inclusive framework. By integrating rigorous doctrinal legal analysis with comparative perspectives from member state laws, this study evaluates the pathways through which directors can be held personally liable for misleading sustainability claims and environmental omissions. The article demonstrates that while the final text of the CSDDD represents a compromise that watered down direct enforcement mechanisms against individual directors, its civil liability provisions (Article 22) combined with national tort laws create a potent legal mechanism. This mechanism effectively links corporate greenwashing directly to a breach of the standard of care. Consequently, the paper argues that robust, auditable due diligence processes are no longer merely ethical choices but have become essential legal shields against personal liability, reshaping the boundaries of corporate governance in the 21st century.