As a systemic risk, climate change has the potential to disrupt the functioning of the entire financial system. This makes climate change a material consideration for boards of directors, who are responsible for ensuring the long-term viability of businesses.
The fourth edition of the Directors’ Duties Navigator: Climate Risk and Sustainability Disclosures (the Navigator)*, like earlier editions, seeks to bring to light the legal duties of directors to address climate change, thereby enabling them to make informed decisions on appropriate climate-risk management.
Developed in collaboration with the Climate Governance Initiative, the Navigator covers 33 countries and the EU. It is a comprehensive and user-friendly tool aimed at directors and their professional advisors to help them understand the relevant legal and regulatory landscape, whether in their jurisdiction or more widely. To this end, the Navigator includes information on:
- Government and regulatory approaches to climate change;
- Directors’ duties in relation to climate change, including requirements to incorporate climate risk in corporate strategy, governance and management;
- Sustainability and climate-related disclosure requirements;
- Liability risks – including litigation risks – for companies and directors; and
- Practical tips for directors.
Several jurisdictions also include an overview of biodiversity-related risks and opportunities for directors. This reflects the growing evidence that biodiversity loss poses material financial risks to businesses around the world, which in turn impacts directors’ duties. By integrating climate and nature-related risks and opportunities into corporate strategy, risk management oversight, governance and disclosure, directors will be better placed to fulfil their obligations while avoiding risks of personal liability.
*Formerly the ‘Primer on Climate Change: Directors’ Duties and Disclosure Obligations’.
Directors’ Duties by Jurisdiction
Click on each section below to discover the fourth edition of the Navigator: