A Timely Climate Risk Webinar

The Financial Times hosted a webinar about a week ago on the topic of climate risk going into 2022, in particular after the major Dutch court ruling this year with respect to Shell Oil. One of the webinar participants was Roger Cox, the lawyer behind a number of rulings including the Shell case, and Maria-Krystyna Duval of Client Earth.

You can see in the slide above that we extracted the main points of the webinar for inclusion in the Climate Web, as we do for hundreds of reports, news stories, and videos. That's just for starters when it comes to knowledge curation in the Climate Web, as you can see here.

It was a thought-provoking webinar, and I thought it would be useful for LinkedIn colleagues to pull out some of the particularly key points from the webinar to allow for a much quicker review. You can scan the full set of points here in the Climate Web.

• Nobody thought that a country could be held liability for their emissions, nobody thought that a company could be held liable.?Now we know they can be.
• Some 2000 climate cases are currently underway, more than doubling since 2015
• All systemic players (responsible for 0.1% of emissions or more) should be very uncomfortable right now.?They basically have a couple of years to put into motion that steps that will accomplish a 45% reduction in emissions by 2030
• Basic ingredient of climate litigation going forward will be “how much control do you have over CO2 emissions?”?Responsibility for 0.1% of global emissions has been shown to be legally sufficient for these cases. And the question will be: are you Paris-aligned?
• Courts may rule that breaching the threshold of dangerous climate change as established by the Paris Agreement is a violation of human rights. Companies don’t want to be contributing to that violation.
• If companies take a stonewalling or greenwashing approach to climate change, opposing policy for example, their Directors are at severe risk of liability for contributing to business risk that the company will be unable to cover.
• In Germany the 3 largest auto makers have been sued similarly to Shell, for inadequate climate policies in relation to the Paris Agreement
• In line with the Paris Agreement, countries and companies should be required to reduce their emissions by some 45% by 2030
• The courts are seeing that countries themselves have long said they can’t do it on their own, and they need the help of other systemic players, e.g. the large emitters. That creates a duty.
• The Paris Agreement isn’t key because it’s legally binding, but because it demonstrates a global consensus on the danger of climate change. That’s what courts are seeing and responding to.
• It falls within Director’s fiduciary duty to be transparent about potential transition risks, including potential policy, potential litigation, and other variables.
• Whether you’re emitting, or financing, or insuring, or own stock in large emitters, you’re potentially liable
• Shell has to start implementing the Court ruling even while they appeal. Shell is required to reduce Scope 1 emissions, and make best efforts for Scope 2 and 3
• Smaller companies will be pulled into the efforts of the systemic players because those players will have to demonstrate “best efforts” to mitigate their full footprint, which includes the smaller player
• We will see much more use of consumer law to go after corporate greenwashing with respect to their activities and commitments. And it will extend far beyond fossil fuel companies.

I remember attending a climate law conference about a decade ago where the general consensus was that judges would have to be insane to generate the kinds of rulings we're now starting to see around the world. Who would have thought that the largely non-binding and non-enforceable Paris Agreement would supply a key piece of the puzzle allowing judges to step up to such decisions. While we're not seeing such decisions in the U.S. at this point, the larger Climate Chessboard looks very different today than it did a few years ago. What will it look like at the close of 2022?