The influence of climate litigation on government

A s climate law, litigation and class actions become more prevalent within the legal profession, it will also, moving forward, have a greater impact on government decision making than ever before.

After passing through the House of Representatives in August, the Labor government’s Climate Change Bill passed the Senate with 37 votes to 30 in September 2022, making it Australia’s first climate change legislation in over a decade to pass the Federal Parliament.

This came after the United Nations General Assembly (UNGA) held a landmark vote to recognise the right to a healthy environment as an essential human right in August this year, which had 161 votes in favour, no votes against, and eight abstentions.

The broad reach of climate law, generally, covers international commitments under the United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement, as well as climate change-specific legislation at the federal and state levels of government, plus renewable energy legislation and traditional environmental legislation.

And this type of law will play out in a number of different ways, impacting a number of different legal sectors, specialist environmental and planning partner at King & Wood Mallesons Mark Beaufoy explained.

“Climate law, in its broad scope, will play a significant role in Australia’s journey to meet its net zero commitments and slow the impacts of climate change. Meeting these targets has ramifications for every sector of the Australian economy. This means that in addition to the work of environmental lawyers, lawyers in a range of disciplines must have a good understanding of the trends in policy and law relating to climate,” he said.

“Following the change of government, one of the first positive steps made by Labor was to confirm Australia’s commitments under the Paris Agreement and to implement those commitments in the legislation. By doing so, the federal government showed leadership on climate change, which to date had primarily been provided by the states.”

The new bill commits Australia to reducing net greenhouse gas emissions to 43 per cent below 2005 levels by 2030 and reducing them to zero by 2050. It also requires an annual climate change statement to be tabled in Parliament that sets out the progress towards achieving the reduction targets, with other laws and policies likely to be brought out moving forward.

And this legislation is only the beginning in terms of Australia reaching these goals. “Clearly, the impacts of climate change are starting to be felt across the globe and in Australia, especially with the increase in extreme weather events,” Mr Beaufoy quipped.

“The recent IPCC report and ongoing scientific understanding of climate change are predicting that the impacts of climate change may well be greater than first predicted and will require significant emission reductions, mitigation efforts and resilience over the next couple of decades. This will require significant changes to laws, decision making, and investments on the path to net zero.”

This sentiment was echoed by the Governance Institute of Australia, which welcomed the introduction of the bill.

“Climate change — and the laws, regulations and expectations around this issue — are set to increase in intensity as the urgent, and very real, nature of this risk becomes more apparent,” a spokesperson said.

“Climate change must play a significant role in regulation and governance, and for organisations, engaging the board is the first step in setting up effective climate governance.”

This legislation comes with a range of potential impacts for different legal sectors, including within the energy, environment and corporate advisory spaces.

“[Climate law] encompasses climate change litigation, which is being brought under a range of laws, including corporate law, competition law, administrative law and at common law,” he said.

“This broad framework of climate-related laws continues to influence government and corporate decision making in relation to investments, project approvals and the reduction of greenhouse gas emissions and impacts.”

Several of Australia’s key regulators have already made climate and sustainability-related issues a top priority. The Australian Competition and Consumer Commission (ACCC) announced that “consumer and fair trading issues in relation to environmental claims and sustainability” is an enforcement and compliance priority for 2022–2023, and the Australian Securities and Investments Commission (ASIC) clearly stated its support for the establishment of the International Sustainability Standard Board to develop high-quality baseline climate and sustainability disclosure standards.

In the face of these changes, lawyers have been urged to use their legal skills to respond to the climate crisis — by keeping updated with any and all reforms, having real conversations with their clients and committing to supporting the community. This is relevant not only to environment and planning lawyers but to other practice areas, too.

“The environmental space is heavily regulated and rapidly evolving, with technology often running well ahead of the regulatory landscape. A big part of the job of an environmental lawyer is keeping up with the regulatory and scientific change that is happening in our space,” Ms Pacey submitted.

“Over my career, I have seen our role increasingly move from advising what you can do, to what you should do — and that can be tricky where the ‘should’ is informed by a combination of science, social trends, government policy, equity, and investment patterns.”

Different types of lawyers also play varying roles in terms of responding to the changing climate law landscape.

“There is a significant role for energy and resources, projects, corporate, and competition lawyers, as well as litigators. Environmental lawyers will play a significant role in providing compliance advice relating to the new framework of climate-related legislation, EPA regulatory decision making, project assessment and approvals for new renewable energy projects,” Mr Beaufoy added.

“Environmental lawyers will also play an important role through advising on ongoing planning and environmental decision making for climate mitigation associated with changing weather events, environmental conditions, and natural disasters. Climate change means significant changes for project assessment and approval legislation and other related environmental issues such as biodiversity protection, waste, recycling, and circular economy.”

There are also a number of other key government reform efforts happening right now. An independent panel has been established to review the integrity of Australian Carbon Credit Units under the Emissions Reduction Fund, with the panel to provide its advice to the government by the end of this year, and the Federal Environment Minister has recently announced that a biodiversity certificates scheme will be introduced, to allow landholders to restore or manage local habitat and sell certificates.