Climate Litigation: A Real Risk for Corporates and Financial Institutions

Climate Litigation: A Real Risk for Corporates and Financial Institutions

Climate litigation is undeniably becoming a significant risk for both corporates and financial institutions worldwide. In recent years, we have witnessed a substantial increase in climate-related legal cases, with not only governments but also private corporations and financial entities, including banks and pension funds, facing scrutiny. One notable example is the groundbreaking world-first case against a global oil company’s Board of Directors in the UK. In another important lawsuit in the Netherlands, the same oil company was ordered to reduce its carbon emissions by 45% before 2030—a landmark decision that marked the first instance of The Paris Agreement being invoked in a court of law. Moreover, non-climate aligned litigation and just transition cases are on the rise, along with an alarming surge in “climate-washing” cases, challenging the accuracy of green claims and commitments.

The growing trend of favourable judicial outcomes in climate cases indicates a shift towards supporting climate action through legal means, and it is essential for corporations and financial institutions to be proactive in addressing this mounting risk. Climate litigation compounds the well-known physical and transitional risks associated with climate change, amplifying its overall consequences for businesses. As investors increasingly recognize climate litigation as a significant form of transition risk, concerns escalate further. To prepare and safeguard against these challenges, WeESG offers specialized training on the risks related to climate litigation. Delivered by seasoned sustainable finance practitioners, WeESG’s courses provide invaluable insights into navigating the complex legal landscape and building resilient strategies to embrace climate action. Get in touch to discover how we can help your company stay ahead in the face of climate litigation.