Organisations – as well as individuals – are increasingly using legal action to challenge both states and corporations in their management of climate-change risk. But, as we move further in 2022, what exactly is the lay of the litigation landscape? And how could social activism in the climate change arena affect a growing range of sectors?
In 2019, when Milieudefensie/Friends of the Earth Netherlands and co-plaintiffs launched legal action against Shell for violating its duty of care around its contribution to climate change, it felt like the beginning of a sea-change.
Two years later, the ruling that Shell must reduce its emissions by 45% by 2030 (both its own emissions and end-use emissions) sets a precedent for individuals and organisations considering legal action against corporations failing to sufficiently address an impending climate crisis.
It’s a snowball of change that’s quickly gathering speed. The report Global trends in climate change litigation: 2021 snapshot, by Joana Setzer and Catherine Higham, reported that, globally, the cumulative number of climate change-related cases has more than doubled since 2015. More than 1,000 cases have been brought in the last six years.
It’s not only global energy suppliers being hit with lawsuits, either. Setzer and Higham’s report found an increasing number of claims focusing on “financial risks, fiduciary duties and corporate due diligence, which can affect banks, pension funds, asset managers, insurers and major retailers, among others”.
Elsewhere, in 2021 the Constitutional Court in Germany amended its Climate Protection Act after four constitutional complaints were made against it and climate protection organisations, including Fridays for Future, argued it was unconstitutional in parts.
Christian Lütkehaus, Partner and Head of Construction & Engineering at multinational law firm Pinsent Masons, said the courts decision could “serve as a significant building block in other climate lawsuits”.
A glimpse of what’s to come?
With climate-change strategies for organisations and governments under growing scrutiny, analysts are predicting that litigation against those deemed not doing enough is only likely to rise over the coming years.
“We expect that climate change litigation will continue to grow, reflecting the increasing urgency with which the climate crisis is viewed by the general public,” Setzer and Higham said in Global trends in climate change litigation: 2021 snapshot.
“We also expect the range of claims and defendants to continue to diversify, reflecting an increased understanding of the role that multiple actors will need to play in the transition to a net-zero global economy. In particular, it is likely that more litigation will be brought against financial market actors.
“Also anticipated is a continued rise in litigation against governments and major emitters that fail to adopt serious long-term strategies underpinned by concrete plans and short-term emissions reduction targets. Entities that act inconsistently with commitments and targets, or that mislead the public and interested parties about their products and actions, are also likely to continue to face increased volumes of litigation.”