One of Australia’s largest banks is being sued for failing to disclose to shareholders the risk climate change poses to its financial interests, Climate Change News reports.
Filed by shareholders Guy and Kim Abrahams, the lawsuit alleges that Commonwealth Bank withheld material from its 2016 directors’ report on climate risks to its investments. According to the divestment campaign group Market Forces, the bank has loaned $6 billion to fossil fuel projects since the signing of the Paris climate accord in 2015. But some financial and environmental experts argue such loans will prove to be risky investments as nations continue to reduce greenhouse gas emissions.
David Barnden, a lawyer with Environmental Justice Australia, told Climate Change News that the case would set “an important precedent” for other companies on climate risk disclosure.
“Many other countries already have similar disclosure requirements to Australia,” said Daniel Wiseman, a lawyer at London-based firm Client Earth. “In the UK, the Bank of England and other financial regulators have now made clear that financial institutions like banks and insurers must consider climate risk. To limit exposure to this sort of litigation, business leaders need to get acquainted, and quickly, with their legal duties and with emerging industry standards.”