TX HB872

Shifts the burden of proof in shareholder derivative lawsuits when the lawsuit alleges improper consideration of environmental, social, and governance (ESG) criteria in corporate decision-making

Requires the corporation to prove that the challenged act or omission was in the best interest of the corporation, rather than placing the burden on the shareholder plaintiff

Applies only to derivative proceedings commenced on or after the effective date; lawsuits filed before that date remain governed by existing law

Adds new Section 21.5525 to Subchapter L, Chapter 21 of the Texas Business Organizations Code

Takes effect September 1, 2025