Over the past six years, the Grantham Research Institute, in partnership with the Sabin Centre for Climate Change Law, has published annual snapshot reports in its Global trends in climate litigation series. Each report provides a synthesis of the latest research and developments in the climate change litigation field, and serves as a valuable resource for understanding the evolving global landscape of climate litigation.

In this Insights, we talk to Catherine Higham (co-author of the Report) and Zaneta Sedilekova (founder of Planet Law Lab) about the implications of the ‘Global trends in climate change litigation: 2024 snapshot‘ (the Report) for director liability in relation to climate and biodiversity risks.

Victoria: The Report explores climate cases filed in 2023 across the world, and assesses trends and themes in the types of cases filed. Could you provide us with five of your key takeaways from the Report? 

Catherine: This is an annual report so many of the trends we explore are continuations from previous years. However, one of the reasons I enjoy writing this report each year is that there are always a few points in the process where you start to look at things in a new light. This year, there are five issues that I’ve started to think about differently after diving into the data:

1. As we see from the response to the Verien Klimasenniorinen v Switzerland case, government framework cases, which challenge the overall ambition and implementation of a government’s climate policy response, are still driving a lot of the narrative around climate change litigation. We’ve now seen more than 100 of these cases filed around the world. This type of litigation appears to be starting to diversify to include a stronger focus on the integrity of net zero commitments, essentially seeking clarity on how governments plan to meet their net zero targets. For example, challenging the lack of detail around depending on carbon dioxide removal technologies to meet future targets. These cases are likely to remain an important source of inspiration for other types of climate cases – including cases against companies and directors – in the future.
2. The number of corporate cases is continuing to rise. Efforts to use the law to tackle “climate-washing”, which involves challenging a range of corporate mis- and dis-information including the say-do gap between net zero targets and real action, are a key driver of this increase. But I was surprised and encouraged to see that there are now more than 20 cases and complaints which are arguing that companies have concrete obligations to align their operations and policies with the goal of rapidly reducing emissions (we call these “corporate framework cases”). These cases have real potential to reshape how we understand responsible corporate conduct in the climate context.
3. Taking a closer look at the climate-washing cases themselves was also eye-opening. We found that they have a very high success rate – of around 70% so far.We also see real diversity within this group of cases, with some claims challenging how sustainability advertising not only misleads the public but may also conceal human rights abuses in the supply chain. These types of human rights cases may have more long-term impacts on the shape of responsible corporate climate action.
4. This year we introduced a new category of cases that we’re calling transition risk cases. These are in some ways similar to the corporate framework cases in that they argue that a company or its directors have the wrong approach to responding to the net zero transition, but whilst corporate framework cases are focused on the climate risks that a company can cause to its stakeholders, transition risk cases are focused on the risks that climate change poses to the company’s bottom line. We think the distinction between the two kinds of cases is likely to become increasingly clear in coming years.
5. When looking for potential future trends this year I was struck by a case in Puerto Rico in which an environmental group is challenging the Federal Emergency Management Agency’s efforts to rebuild infrastructure damaged by hurricanes. They argue that the agency is taking the wrong approach in rebuilding fossil fuel infrastructure (contributing to lock-in) rather than putting resilience and mitigation efforts at the heart of the rebuild. As we see more and more climate disasters affecting communities around the world, we think we may see more of this kind of litigation.

Victoria: Can you explain what types of cases are being filed against directors, and where they are being filed?

Catherine: So far, cases against directors make up a small handful of the overall total. Nonetheless, there are some important developments in these cases. As we wrote in the 2023 report, earlier cases against directors were backward looking, as we saw in derivative litigation against Exxon following its alleged misrepresentation of climate-related risks. We then saw NGOs like ClientEarth starting to take up some of the arguments in these cases and expand on them, thinking about what a failure to identify and manage climate risks might mean for the future and using that to develop more forward-looking cases. These arguments were used in the case of ClientEarth v Shell directors, which was dismissed in the UK High Court last year. The judgment shouldn’t, however, be seen as the end of the story. Lord Robert Carnwath, Visting Professor at the LSE and former Supreme Court judge has described it as a missed opportunity and there are plenty of people thinking about where to take some of these ideas next. Since the case concluded we’ve also seen an interesting development in Poland, where Enea is planning to sue its former directors for their role in mishandling the companies’ investment in plans for a new unit at the Ostroleka C powerplant. The unit was originally intended as a coal plant but couldn’t get financing in that form, ultimately resulting in the project being abandoned.

Victoria: Why do you think that directors are increasingly in the spotlight for their management of climate risks? 

Catherine: I think the last few years have seen a real growth in acceptance of the idea that climate change is going to mean changes for the way people do business, whether that’s because of the transition or because of the physical climate risks that are manifesting in the here and now. But we’re still seeing differences in the pace at which companies and directors are starting to respond to this shift, as well as competing views of what action (if any) is required to keep ahead of the change. I think this is where we’re seeing a lot of scrutiny being put on directors, and why we could see more litigation as well.

Victoria: How are climate litigation trends impacting biodiversity litigation?  What are the key similarities and differences between climate litigation and biodiversity litigation?

Zaneta: Biodiversity litigation, or more recently called nature litigation, is following similar upwards trajectory we saw in climate litigation between 2015 (when the Paris Agreement was signed) and 2023 (when the increase in climate cases levelled off for the first time). This is inspired to a large extent by arguments and successes seen in climate litigation. Each year we see more and more cases, with more sophisticated arguments built on more complex set of circumstances and supported by more and more astute teams of lawyers. The trend is well underway.

Indeed, there are important similarities between climate and nature litigation. The increase in both is a consequence of a failure of governments and corporates to address system-wide issues that harm climate, nature and people. Courts are not well suited to address these system-wide issues. Litigation between two parties (even if multiple claimants and defendants are involved) is a process focused on a specific set of circumstances and specific wrong-doings, not a system in which those have unfolded. The judgments often have consequences beyond the immediate litigants, but legally speaking, there are only enforceable against the parties to the dispute. If climate and nature litigation were to address all issues our society and planet are facing, there would be no end to it. The fact that people are now turning to courts with issues that have traditionally been the job of governments and corporations to address tells us that the established structures are failing those for whom they have been created in the first place. In this sense, both climate and nature litigation are only one lever of change in society that needs to undergo systems change.   

Having said that, there are several differences between climate and nature litigation. Let me take damaged-based claims, that is claims which, if successful, result in the award of damages to be paid by the defendant, as an example. In climate litigation, these claims are very hard to establish because of the need to establish what we call ‘causation’ – essentially a link between the damages suffered by the claimants and the GHG emissions of the defendants. Claimants have to turn to complex attribution science to establish causation, which is novel and often not well understood by lawyers and judges. Having said that, the evolution in the theories of causation over the past four years means that these cases are slowly progressing through courts – in fact, we expect the judgment in the first such case – Lliuya v RWE – in 2025. If this is successful, the floodgate to damages-based climate cases will open.

Nature litigation faces no such issues. By their very nature (no pun intended), nature and biodiversity loss are location-specific. They happen in a specific location and their impacts are felt by people and ecosystems at this location. Causation is therefore not established through complex attribution science but through what I call ‘tracing’. Depending on a cause of actions in these claims, nature litigants trace either supply chains, ownership structures or money from the country where biodiversity loss has occurred to the country of a company where proceeds generated from such loss have been materialised. Tracing faces its own difficulties but these are much easier to address though existing scientific methods, as seen in the ongoing test cases.

Victoria: Is the rate of climate litigation cases against directors and officers growing or slowing? Can you explain why?

Catherine: As discussed above, there are still only a handful of cases against directors so it’s hard to say anything about the trend increasing or decreasing yet. I imagine we may start to see more cases in coming years. One reason for this is that we’re at something of a turning point in the way that corporate governance through the transition is being managed, and an increase in regulation of various sorts may catch directors who’ve had their heads in the sand unaware and expose past errors in judgment. The Ostroleka C case may be a harbinger of similar cases in future.

Victoria: How can directors reduce their exposure to biodiversity-related litigation?

Zaneta: There are many steps directors can take to reduce their explore to nature litigation. Practically speaking, the way decisions are made in the boardroom is the place to start. Are impacts of board decisions on nature determined, assessed and considered by the board? Does the board take adequate advice on decisions that may impact nature? Have board members received sufficient training to understand how nature comes into their company’s business and when to request external advice? Is there a person on a board with a mandate to raise issues that concern the company’s interaction with nature? A recent example of how this may look like in practice includes an appointment of a nature director to the board (to speak on the issues relevant to nature, very much like the HR director speaks to the issues relevant to employees, or the finance director speaks on finance). All these are outlined in much more detail in several recent publications – the 2022 jurisdiction-agnostic report called Biodiversity Risk: Legal Implications for Companies and their Directors, as well as two powerful legal opinions, one discussing director’s duties in the context of biodiversity loss in Australia, and one in England and Wales.

Victoria: What key biodiversity litigation trends do you expect to see in the coming years?

Zaneta: Let me outline three key trends I expect to see. First, I expect the number of cases tracing impacts of corporate activity on nature through supply chains to significantly increase. There are several such cases already underway under existing national laws, such as the Casino case based on the French Duty of Vigilance. But the EU legislation, including the EU Deforestation Regulation and the Corporate Sustainability Due Diligence Directive, is set to bring about new evidence and grounds for such litigation against many more companies.

Governments, on other hand, are likely to face more rights-based litigation which combines nature and ecosystem harms with infringements of human rights. With the exception of several countries, most jurisdictions do not recognise nature as having its own rights to bring a case in its own name. Therefore, nature and ecosystem harms are often combined with human rights to develop a strong case. Advances in science increasingly support the relationship between human and nature thriving, which is one of the reasons these cases are likely to increase.

Finally, I also expect more climate cases to bring forward nature arguments in what is sometimes called climate-nature nexus litigation. Some are already underway, such as California v. Big Oil, where the state of California argues that climate change has impacted its ecosystem services, including clean air, clean water, crop pollination, as well as recreational activities, leading to negative economic consequences. The motivations behind these arguments are manifold, but the most obvious one is that they increase the damages that can be claimed from the defendants.   

Victoria: Lawyers are becoming increasingly creative in their approach to strategic climate litigation. Where do you think we are likely to see an uptick in climate litigation against directors and companies in the future? Catherine: In the report we predict that we might see a future trend of litigants trying to use criminal law against directors and companies that contribute to climate change. Since the report was published we have already seen one new case (Bloom v TotalEnergies). While these types of cases may have a relatively low likelihood of success they could contribute to changing narratives about corporate responsibility. The other area where we may start to see more litigation against directors and companies is off the back of new legislation, such as to clarify or enforce new mandatory disclosure, due diligence, or climate transition planning laws. For example, there are still unanswered questions about how the EU Corporate Sustainability Due Diligence Directive applies to companies in the context of climate change. Litigation may increasingly be a way for different actors to express views on how this type of uncertainty should be resolved.