We investigate the relationship between corporate social performance and litigation risk by examining US class action lawsuits. We find that a one standard deviation improvement in environmental, social, and governance (ESG) controversies of an average sample firm reduces litigation risk from 3.1% to 2.4%. Moreover, an average sample firm with low ESG performance exhibits losses twice as high in market value compared to a firm with high ESG performance, i.e., an abnormal loss of US $1.14bn. Implementing our findings with a trading strategy yielded positive monthly alphas, suggesting that investors benefit from lower litigation risk and insurance-like protection.