TLDR on Climate Litigation Trends from the NGFS
Climate-related litigation will likely expand beyond climate change to biodiversity loss.
The Network for Greening the Financial System (NGFS), an organisation that facilitates collaboration among central banks and financial regulators globally, recently released a report entitled Climate-related litigation: recent trends and developments. It’s not a long read, but here’s the TLDR version we put together:
There is an increase in climate litigation across the board for states and public entities, non-financial corporations, and financial institutions.
Claims have been brought against companies in fossil fuels and energy, transportation, mining, agriculture and food, plastics, construction, and building materials.
Claims against states and public entities focus on:
Systemic climate litigation - states are failing to address climate-related human rights,
Decisions incentivising third parties - states are allowing fossil projects to proceed,
Procedural obligations - states must provide data and transparency, and
Supervisor obligations - regulators should be regulating
Claims against non-financial corporations focus on:
Human rights
Tort law, aka public nuisance
Due diligence on risk disclosures
Damages linked to GHG emissions (which is increasingly possible with advancements in attribution science)
Greenwashing, aka misleading customers
Company law, where NGOs become shareholders and claim that company is not meeting fiduciary obligations
Legal risks include increases in litigation costs
Claims against financial institutions focus on:
Greenwashing
Breaches of directors’ duties
Violation of corporate due diligence laws
Finally, NGFS advise that climate-related litigation will increase and likely expand beyond climate change to biodiversity loss.
