Climate-linked litigations and regulations. Are we prepared ?

The 2023 Global Climate Litigation Report prepared by the United Nations Environment Programme and the Sabin Center for Climate Change Law at Columbia Law School revealed a stark increase in climate change litigation worldwide. Between July 2020 and December 2022, 630 climate change lawsuits were filed across the world.

英国伦敦政治经济学院 reported in 2022 that climate change-related cases had more than doubled since 2015. An emerging area of climate litigation concerns disputes between fossil fuel companies and their insurers over payouts for climate-litigation costs.

2023 was a year of significant change for climate-related litigation and regulation. Across the world, dissension over governmental jurisdiction to pass environmental laws persisted. A few governments courageously launched several legislative initiatives, some pro-ESG and others “anti-woke.”

Getting into 2024 , corporations should brace themselves for an anticipated rise in lawsuits targeted at forestalling perceived environmentally harmful development and investment activities, investigating businesses’ environmental disclosure and climate claims and pestering corporate boards on their #sustainability and #ESG KPIs. Corporations should prepare themselves for enhanced legislative and regulatory action mandating disclosure regarding climate change matters by issuers including scope 3 and social indicators.

Businesses can also anticipate initiatives from increasingly #activist organizations seeking to challenge project approvals under #environmental and #social legislation for failing to address or consider the effects of #just climate transition.

Businesses can also anticipate claims for alleged failures in their climate emission mitigation efforts. There have been numerous instances of claims made around the world. Most of these actions seek to hold corporations liable for the impact of downstream use of their products or services. While tort claims are difficult to bring in common law jurisdictions because of the general principle that a duty of care cannot be owed to an unlimited class of plaintiffs, this has not stopped governments around the world from filing such claims against businesses.

The International Organization of Securities Commissions - IOSCO has published a final report on supervisory practices to address greenwashing, leveraging its members’ experience from initiatives taken in their own jurisdictions.

As more businesses undertake to demonstrate to their customers and investors the environmental strength and sustainability of their products, operations or investments, they need to be more wary of “greenwashing.