From the war on plastic showcased in David Attenborough’s Blue Planet II to disruptive street protests, public awareness around the prospect of a warming planet has never been higher and plays a significant role in public discourse. The science on climate change is now clear and increasingly tangible as recent extreme weather events such as the floods in Pakistan, Hurricane Ian in Florida and the extreme heat in the UK this summer have shown. Whilst governments, scientists and not for profit organisations continue to work towards altering the potential future impact of climate disruption through policy changes and scientific developments, climate conscious individuals, charities and activist groups are increasingly bringing legal proceedings across the globe, in the hope of forcing meaningful change.
In its June 2022 snapshot report[1], the London School of Economics reported that the cumulative number of climate change-related legal cases commenced across the globe has more than doubled since 2015, and now totals over 2000 cases, with around a quarter initiated between 2020 and 2022. Whilst the majority of cases still emanate from the USA, Europe has recently seen a growing wave of litigation against both governments and companies. Increasingly, action is being taken against corporates in sectors ranging from transport, clothing, food, plastics and finance as well as fossil fuel producers and governments. This article considers some of the significant developments in European climate litigation and looks at how the UK fits into that wider picture.
What is climate change litigation?
Climate change litigation broadly describes claims where climate change is a material issue in terms of science, law or fact and incorporates proceedings relating to global warming or climate change mitigation/adaptation. Proceedings have been issued around the globe against governments, companies, trustees and directors for failures to take sufficient steps to reach net zero targets, failures to disclose or manage the financial risks associated with climate change, and for misrepresenting green credentials (“greenwashing”).
The scope of climate change litigation continues to evolve, involving a variety of claimants (including not for profit organisations, activist groups and individuals), with varied objectives including strategic ambitions (aimed at bringing about broad changes in behaviours or to raise public awareness), increasing pressure on governments to instigate policy change, forcing carbon majors to reduce emissions in line with the Paris Agreement (“PA”) and preventing greenwashing.
Europe - the impact of Urgenda
In 2019, in a case widely considered to be instrumental in the development of climate change litigation, the Dutch Supreme Court in Urgenda v Dutch Government upheld the decision of the lower court. That decision found the Dutch Government’s existing emissions pledge was insufficient to meet the state’s fair emissions contribution required under the PA, in breach of Articles 2 (right to life) and 8 (right to private life, family life, home and correspondence) of the European Convention on Human Rights (“ECHR”). The decision confirmed a domestic court had the power to enforce compliance with an international treaty against a national government. It also confirmed that the state had a duty of care to protect its citizens from climate change in accordance with its obligations under the ECHR, and set out the responsibility of the Netherlands to reduce its emissions in line with the PA even though that reduction may have limited effect on a global scale. While a country may only be a minor contributor to climate change compared with others, the court in Urgenda found that this did not reduce that country’s individual responsibility.
In February 2020, a group of German climate activists filed a challenge[2] alleging that Germany’s Federal Climate Protection Act (the “KSG”)’s target of reducing greenhouse gases by 55% compared to 1990 levels on or before 2030 was insufficient and breached the claimants’ human rights as set out in Germany’s constitution. In failing to set targets to cut emissions beyond 2030, the German court found parts of the KSG violated the rights of future generations as major emission reduction burdens were effectively offloaded onto periods after 2030. Revised laws are to be enacted by the end of 2022.
Similar successful claims have been brought against other governments, including the recent decision of the Prague Municipal Court in Klimatická žaloba ČR v. Czech Republic which ordered the Czech government to create a more ambitious emission reduction plan in line with its obligations under the PA. Although the goals of the PA were not legally binding, the national contribution of the Czech Republic could not be avoided.
Increasingly these challenges may be leading to real world policy change. For example, in 2021 the Dutch Cabinet restricted the operations of coal power stations to no more than 25% of their maximum capacity until 2024. The reality is of course, that ever changing global tensions also impact government policy - the Dutch policy has since been revoked due to the energy crisis created by the Russia/Ukraine conflict.
Claimants are also increasingly targeting corporations - 2019 saw the landmark Dutch case of Milieudefense et al v Royal Dutch Shell, in which the claimants alleged Shell’s contributions to climate change breached its duty of care under Dutch law and its human rights obligations. Essentially the Claimants alleged the PA, combined with scientific evidence regarding the impact of climate change, meant that Shell owed a duty of care to take steps to reduce its greenhouse gas emissions. The Hague District Court agreed that private corporations do owe a duty to mitigate the impact of climate change. In May 2021, the Court ordered Shell to reduce its worldwide CO2 emissions by 45% by 2030 compared with 2019 levels on the basis that a failure to take sufficient measures to reduce emissions gave rise to a breach of its “unwritten standard of care” under the Dutch Civil Code and that although the PA was not binding on Shell, the goals of that agreement were relevant in determining the extent of its CO2 emissions reduction obligation. Although Shell filed a statement of appeal in March 2022, as the Dutch Court’s decision was provisionally enforceable, it is obliged to comply with the order until the outcome of the appeal.
Pending appeal, the decision in Shell has effectively extended the decision in Urgenda to private corporations who, under Dutch law now owe a duty to take effective steps to mitigate climate change. This has resulted in further claims being brought against companies in Europe. For example, Deutsche Umwelthilfe (“DUH”), a German NGO has initiated action against both BMW and Daimler arguing that the companies’ emissions targets are not sufficient. Cases have also been brought against VW and the oil and gas company Wintershall Dea in Germany.
United Kingdom
In the UK, climate change litigation had until recently been limited almost entirely to applications for judicial review of carbon intensive projects (e.g. the expansion of Heathrow Airport - see here) arguing that such projects are at odds with the PA and Climate Change Act 2008.
In a change of direction, cases have recently been brought based on Article 2 of the PA[3] aiming to channel the power of finance as a force for positive climate action rather than a barrier to change. In April 2021, permission to bring judicial review proceedings was sought by three UK students under the umbrella of the charity ‘Plan B’ claiming that the UK government had infringed their human rights by failing to produce a coherent plan for upholding its PA commitments. Allegations included that the government had failed to prepare an adequate roadmap to reach its net zero emissions target for 2050.
While this case was swiftly disposed of, with the Judge branding it “unarguable”, in July 2022 the claimants filed an application at the ECtHR against the UK arguing that the UK government is failing to take effective measures to address climate disruption thereby breaching its human rights obligations. The application highlights the UK domestic court’s decision that the PA was not a relevant consideration in determining rights under ECHR, a conclusion which is in contrast to the decision in Urgenda.
In September 2020, Friends of the Earth (“FoE”) brought a landmark challenge to the UK government’s decision to provide $1.15bn of support for a liquidised natural gas development in Mozambique[4]. FoE sought a judicial review of the UK Export Finance (UKEF)’s conclusion that the project was compatible with the UK’s PA commitment[5] and was the first time a UKEF funding decision had been challenged on climate related grounds. Although in March 2022 the court concluded the decision of UKEF was lawful, it was a split decision and FoE has been granted permission to appeal.
In another action this year, FoE and others began judicial review proceedings against the Secretary of State for Business Energy and Industrial Strategy in relation to two decarbonisation policies adopted by the UK government, which the claimants alleged breached the Climate Change Act and Equality Act. In July, the High Court found in favour of the Claimants, ruling that the Net Zero Strategy which set out plans to decarbonise the economy did not meet the government’s obligations to produce detailed climate policies evidencing how the UK’s carbon budgets would be met. The court essentially concluded the strategy had been unlawfully adopted, noting also that parliament and the public were not told about shortfalls in meeting key targets to cut emissions. The court granted the Claimants declaratory relief and the government’s strategy will now need to include a quantified account of how its policies will meet legally binding carbon budgets, with the revised strategy then being scrutinised in parliament. On the Claimants’ view this will “force the Government to put in place climate plans that actually address the crisis”.[6]
The increase of litigation is not limited to action against the government or governmental bodies. Earlier this year, ClientEarth notified Shell that it intended to bring a derivative action against its board of directors under s172 and 174 of the Companies Act 2006 – a claim which could see company directors held personally liable for alleged failure to properly prepare for energy transition[7]. It is yet to be seen whether the court will grant permission for the claim to be continued.
Looking ahead
Climate litigation is here to stay and shows no sign of slowing down with increasing moves in the UK towards action against corporates. As climate related disclosures are increasingly scrutinised in financial statements and consumers become more alive to issues of greenwashing, the likelihood is that companies are exposed to additional litigation risk. Litigation is increasingly exerting pressure on government policy – in December 2020 the UK government announced it would no longer finance non-UK fossil fuel projects[8]. At COP26 in 2021, an agreement was put forward to end new direct public investment in fossil fuels by the end of 2022. Amongst the signatories were the European Investment Bank, the UK, US and France[9].
Time will tell whether strategic cases in the English courts will have comparable impact to those brought in Europe. What is likely, however, is that claimants will be emboldened by successes against the likes of Shell, and while strategic climate change litigation is often unsuccessful before the court, that is not necessarily fatal for claimants whose aim is often also to raise awareness of issues and push for wider change. The threat of litigation, with the reputational damage and associated cost that proceedings can bring, may be enough to significantly impact corporate and governmental climate related policy and governance.
Whilst COP27 succeeded in reaching an agreement to create a fund for climate loss and damage, commentators are already highlighting that COP 27 failed to reach any clear agreement on the phasing out of all fossil fuels. To quote President von der Leyen following the conclusion of the summit “We have treated some of the symptoms but not cured the patient from its fever”.[10] For this reason alone the continued growth of climate litigation seems inevitable.
[1] https://www.lse.ac.uk/granthaminstitute/publication/global-trends-in-climate-change-litigation-2022/
[2] Neubauer et al v Germany
[3] Article 2 set a goal of holding the increase in global average temperature to less than 2°C, whilst pursing efforts to limit the increase to 1.5°C.
[4] [2022]EWHC 568
[5] Including amongst other reasons for failure to quantify Scope 3 emissions (arising from the use of gas)
[6] https://friendsoftheearth.uk/climate/govts-climate-strategy-deemed-unlawful-historic-ruling
[7]https://www.clientearth.org/latest/press-office/press/clientearth-starts-legal-action-against-shell-s-board-over-mismanagement-of-climate-risk/
[8] https://www.gov.uk/government/news/pm-announces-the-uk-will-end-support-for-fossil-fuel-sector-overseas
[9] https://ukcop26.org/statement-on-international-public-support-for-the-clean-energy-transition/
[10] https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_22_7043
