Move over greenwashing and AI washing, a new D&O risk is emerging

We’ve all heard about companies engaging in ‘greenwashing,’ where directors misrepresent their climate credentials or fail to act in accordance with their stated climate goals. Or ‘AI washing’ — when companies allegedly overstate their artificial intelligence capabilities.

But a more nuanced trend is emerging from a commercial D&O perspective: ‘tariff washing.’

“If you talk about a commercial D&O lens, or you talk about specialty lines more generally, we went through an era of what we were calling greenwashing,” Matt Studley, the newly appointed president of Hub International’s Ontario and Atlantic regions, tells Canadian Underwriter in an interview. “So, everybody was trying to be ESG [environmental, social and governance principles] compliant across these companies.

“Were they doing a good job? Were they mispresenting the amount of investment they had made?”

While greenwashing is still occurring, tariff washing has emerged as a concern following widespread global tariffs imposed by the U.S. government.

“How much of an impact [do] the tariffs have?” Studley asks. “Are you under-disclosing? Are you over-disclosing?

“And obviously that’s a very careful balance to strike when you’re talking about public D&O insurance, especially in certain sectors that are materially impacted by what’s going on south of the border.”

Canada’s automotive and manufacturing sectors have been particularly hard-hit. For example, Mitchell (an Enlyte company) said last year tariffs on raw materials like steel and aluminum have the potential to increase auto repair claims costs on both sides of the border.

And global specialist insurer Beazley says in a December 2025 article that tariff washing was poised to join the ranks of disclosure pitfalls like greenwashing and AI washing in 2026, “highlighting the growing risk of miscommunication or omission around the impact of tariffs on business operations.”

As trade policies shift rapidly, corporate disclosure faces a persistent challenge — when and how to report tariff impacts, mitigation strategies and financial implications, writes Bethany Greenwood, chief executive officer of Beazley Furlonge Limited and group head of specialty risks.

Overstating or understating these impacts can lead to severe consequences, from reputational damage and stakeholder mistrust to mounting legal action.

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“Court cases are beginning to surface, and lawyers are circling for inconsistencies,” the article reads. “With AI tools now capable of reviewing every word a company or CEO has ever said, finding contradictions or omissions has never been easier.

“A single misstep in disclosure could lead to regulatory scrutiny or litigation.”

Jason Contant

Jason has been an award-winning journalist with Canadian Underwriter for more than a decade, including the past three years as associate editor and, before that, as digital editor for seven years.