Lethal Heating: 10/03/19

03/10/2019

Company Directors May Be Headed For Litigation Over Climate Change

CPA INTHEBLACK - John Purcell

The Commonwealth Climate Law Initiative is investigating how company directors may be drawn into climate change-related litigation.

Australian directors face the greatest potential liability from the impact of climate change on their businesses.

At a glance

A significant challenge in reducing global carbon emissions is the fact that neither national laws nor international public law are designed to address problems that have global reach.
Projects such as the CCLI demonstrate adaptations to national laws and innovations to international law, while encouraging company directors to take account of climate change risk.
According to the CCLI’s project report, Australian directors face the greatest potential liability from the impact of climate change on their businesses.

The impact of climate change and marshalling global efforts towards emissions reduction present profound challenges. Neither national laws nor international public law are designed to comprehensively address problems that are interconnected and have global reach.
However, there are developments that illustrate adaptations in national laws, and novel innovations are being suggested in international law. These developments occur separately from international treaty arrangements under the United Nations Paris Agreement, where national governments commit to implementing domestic policies to reduce carbon emissions.
The Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD) provides one of the most readily understandable summations of climate-related risks. There are two major categories: risks related to the physical impact of climate change, and risks related to a transition to a low-carbon economy.
Transition risk can occur from legal action brought by claimants seeking redress or wanting to force protective or remedial action. The TCFD says this could stem from “the failure of organisations to mitigate the impacts of climate change, failure to adapt to climate change, and insufficiency of disclosures around material financial risk”.
How realistic then is litigation risk to companies and their directors?
The Commonwealth Climate and Law Initiative (CCLI), a research project focusing on Australia, Canada, South Africa and the United Kingdom, examines the basis for directors and trustees to take account of physical climate change risk and societal responses to climate change. Each of these countries has common law legal systems where judicial decision plays a key role in interpreting statutes and in building legal rules based on an evolving body of precedent.

The CCLI's project report concludes that Australian directors face the greatest potential liability from the impact of climate change on their businesses.

The “adaptability” of corporate law, and in particular directors’ duties, within the common law tradition provides a sound and practical basis for linking climate-related financial risks with possible governance failures that spanning well-established legal expectations around identification, assessment, oversight and disclosure.
The CCLI’s project report concludes that Australian directors face the greatest potential liability from the impact of climate change on their businesses.
However, fundamental to each jurisdiction are two broad categories of directors’ duties, which the CCLI summarises as:

Duties of trust and loyalty, including good faith, proper purposes and best interests (fiduciary).
Duties of competence and attentiveness (due care and diligence).

Of the four countries, Australia is the most stringent in interpreting and applying these duties:

The duty of care and diligence can be breached in circumstances of “mere” negligence.
There is a particularly strong adherence to an objective standard of what a “reasonable director” would do.
There is minimal scope to argue “business judgement rule” protection.

Proof of dishonesty, intention or bad faith is not required for breaches of trust and loyalty.
In these terms, managing climate-related risk falls squarely within well-understood legal expectations of active and inquiring engagement in guiding and managing the affairs of a company – matters that the CCLI says are self-evident given that Australia’s economy operates in high-risk sectors from both physical risk and transition risk perspectives.
Australia is also a well-established litigation funding market. It has a strong track record of class actions for misleading disclosures and an independent regulator willing to test the boundaries of directors’ duties and enforce existing well-understood duties relating to disclosure.
What of the more speculative realm of developments in international public law?
The International Criminal Court, which is created under Article 5 of the Rome Statute (another treaty to which Australia is a signatory), has specific and narrow jurisdiction limited to the most serious crimes recognised by the international community, including genocide, crimes against humanity and war crimes.
Limited but strong lobbying is taking place to amend the Rome Statute to include an international crime of ecocide, defined as “the extensive loss or damage or destruction of ecosystem(s) of a given territory, whether by human agency or by other causes, to such an extent that peaceful enjoyment by the inhabitants ... has been or will be severely diminished”.
The CCLI cautions against overstating the practical likelihood of litigation, but also warns against dismissing the risk as remote or theoretical, particularly for those companies in high-risk sectors. Whether or not the advocates of ecocide succeed in their endeavours, the fact that the prospect is being canvassed adds to what should be self-evident to directors: the physical and economic transition risk realities associated with climate change.

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Iceberg The Size Of Sydney Breaks Off Amery Ice Shelf In Antarctica

ABC News - Carla Howarth

Satellite images show the Amery ice shelf before and after the D28 iceberg broke off. (Supplied: AAD)

Key points

The iceberg, named D28, broke off the Amery ice shelf on September 26
The last major calving on the shelf was in the 1960s
Scientists do not believe the event is linked to climate change and say major calving events happen every 60 to 70 years

A gigantic iceberg the size of urban Sydney has broken off an ice shelf in Antarctica, the Australian Antarctic Division (AAD) says.
The 1,636-square-kilometre iceberg — named D28 — was calved from the Amery ice shelf in east Antarctica.
AAD glaciologist Ben Galton-Fenzi said the iceberg separated from the shelf last Thursday, and was noticed by scientists using satellite imagery.
Scientists had been monitoring a section of the ice shelf known as the Loose Tooth, which is next to where D28 broke off and is so named because it looks precariously attached.

"The calving will not directly affect sea level, because the ice shelf was already floating, much like an ice cube in a glass of water," Dr Galton-Fenzi said.

"But what will be interesting to see is how the loss of this ice will influence the ocean melting under the remaining ice shelf and the speed at which the ice flows off the continent."

Last major iceberg broke off Amery in 1960s
The 60,000-square-kilometre Amery ice shelf is the third largest shelf in Antarctica and is situated between Australia's Davis and Mawson research stations.

A crack in the Amery ice shelf, pictured in 2003. (Supplied: Australian Antarctic Division)

An ice shelf is a section of ice that juts out into the sea.
Snow from the interior builds up and flows out to the edge of the continent. At the edges it thins, and because ice is less dense than water, it sits on top of the ocean instead of on the seabed.
Scientists have been studying the Amery shelf since the 1960s, and recorded the last major calving event in late 1963 or early 1964.
The massive tabular iceberg was about 10,000 square kilometres, and split into two smaller bergs a year later.

The anatomy of an ice shelf. (Supplied: Dr Sue Cook)

Calving 'not linked to climate change'
Helen Amanda Fricker, from the Scripps Institution of Oceanography in the US, said scientists first noticed a rift in the ice shelf nearly 20 years ago.
"We … predicted a large iceberg would break off between 2010-2015," Professor Fricker said.
"I am excited to see this calving event after all these years. We knew it would happen eventually, but just to keep us all on our toes, it is not exactly where we expected it to be.
"We don't think this event is linked to climate change; it's part of the ice shelf's normal cycle, where we see major calving events every 60-70 years."
In July 2017, a 1-trillion-tonne iceberg measuring 5,800 square kilometres was calved from the Larsen C ice shelf in Antarctica.
The Larsen C ice shelf, which is Antarctica's fourth largest ice shelf, covers an area of 46,500 square kilometres.

An iceberg measuring 5,800 square kilometres calved

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Climate Change Threatens The World’s Fisheries, Food Billions Of People Rely On

InsideClimate News - Georgina Gustin

More than 3 billion people depend on fish as a major source of protein. By the end of the century, a quarter of the sustainable fish catch could be gone.

In many islands and coastal areas, fishing is both a primary source of income and a main source of protein. A new IPCC report warns that ocean fish stocks could drop by as much as a quarter if greenhouse gas emissions continue on their current trajectory. Credit: Derek Hudson/Getty Images

The world's already overtaxed fisheries are being stressed to their limits by climate change, putting at risk a critical component of the world's diet. As temperatures rise, fish populations are projected to plummet and disappear in some regions, especially in the tropics.
In a major report published Sept. 25 by the United Nations' Intergovernmental Panel on Climate Change, scientists examined the interconnected web of the planet's oceans and icy landscapes, delivering a series of grim projections on the chaotic impact of climate change on super-charged storms, rising seas and the ecosystems that sea life depends on.They also looked at the consequences for global diets and the role oceans play in feeding the world.
Fisheries are often overlooked when researchers and policymakers focus on land-based agriculture as the primary food source for a growing global population, yet fish are an essential protein source for 3.2 billion people and provide 17 percent of the world's animal protein. They're especially important in some developing tropical countries that rely on fish for 70 percent of their nutrition.
"The changes in the oceans will have direct impacts on people who are depending on these systems for food," said William Cheung, a professor from the University of British Columbia and a lead author of the report's chapter covering fisheries.
The scientists determined that the sustainable fish catch—the amount of fish that can be caught without decimating populations—could drop by as much as a quarter by the end of the century if greenhouse gas emissions continue on their current trajectory.

The oceans have absorbed about 90 percent of the excess heat and about a quarter of the carbon dioxide from fossil fuel burning and other human activities, leading to rising ocean temperatures, increasing acidification and lower oxygen levels that will have an impact on sea life. Shellfish won't be able to develop shells properly; harmful algae blooms will proliferate, choking off coastal fisheries; and populations of fish will continue moving to cooler waters, leaving behind the fishing communities and economies that have depended on them for centuries.
"The current science suggests that as the ocean warms and loses oxygen, the body size of animals will be reduced, the distribution of fish will change and the surface production of phytoplankton is going to decline," said Lisa Levin, a professor at Scripps Institution of Oceanography and a lead author of the fisheries chapter. "When there's less plankton at the base of the food web, there's going to be less fish."

Impacts from the Tropics to the Arctic
As the world speeds toward a population of 9 billion people by 2050, the loss of fish as a protein source could mean increased pressure on other ecosystems, including forests cleared for cropland and existing cropland that's already strained from overuse.
In tropical countries around the planet's equatorial belt, particularly small-island developing nations that are also at risk from sea level rise, the loss of fish stocks could prove devastating, nutritionally and economically.
"Climate change will take the food out of their mouths and the places they live away from them," said Doug Rader, chief oceans scientist with the Environmental Defense Fund, who was not involved in the report. "Even with aggressive emissions scenarios and highly effective management, they will lose 20 to 40 percent of their fish production. There are literally hundreds of millions of people who live in that most at-risk belt."
Communities at middle and higher latitudes will see changes, too.
Cheung explained that some North American communities that rely on salmon could lose those populations as streams warm and fish migrate farther north, and that indigenous communities in the Arctic that depend on sea ice as hunting grounds could lose access to key food sources.
"Shifting the abundance and distribution of these resources may have direct impacts for food, culture and livelihoods," he said. "In Arctic regions, many communities are dependent on sea ice. With high emissions scenarios, we are seeing the continuous loss of sea ice and higher frequencies of no sea ice in the summer."
Researchers have also projected the northward migration and disappearance of some tuna species from the tropics and of cold-water-loving species like lobster, which will move poleward as waters warm.

Many Fisheries Are Already in Trouble
Fish populations in many regions have already dropped significantly because of overfishing and the accelerating effects of climate change. Roughly one-third of the ocean's fish stocks are already fished at "biologically unsustainable levels," triple that of the mid-1970s, according to the UN Food and Agriculture Organization (FAO).
Overfishing by commercial fleets with large boats and aggressive fishing methods, such as trawling, led to the devastating collapse of the East Coast cod fishery in the early 1990s and, more recently, the herring population. Some researchers suggest that the drop in fish stocks is even higher than the FAO states because government agencies and regulators don't have complete assessments and figures.
"Ocean warming in the 20th Century and beyond has contributed to an overall decrease in maximum catch potential, .... compounding the impacts from overfishing for some fish stocks," the new IPCC report says.
Most of that overfishing has occurred as commercial fleets go after larger, high-value fish for the global marketplace and to satisfy growing demand for seafood from developed countries.
"Most of the overfishing has not been to feed the hungry," said David Helvarg, executive director of Blue Frontier, a marine conservation group. "It's been for supermarkets and white-linen restaurants in the developed world."
Fish consumption reached a historical peak in 2016 at about 45 pounds per capita. Much of that is attributable to aquaculture—farming fish in contained waters—which in 2016 produced more consumed fish than commercial and traditional "capture" fisheries.
"Globally, we're following the terrestrial experience. We're transitioning from buffalo to cattle," Helvarg said. "We're consuming more fish, but less of it is coming from the ocean as we've depleted the commercial stock."
"The shift toward aquaculture will expand, but we're going to become a nutritionally depleted world," Helvarg added. "We'll be eating a much more limited amount of fishes based on what we can grow in concrete tanks."

Saving Ecosystems and Managing Fisheries
In some ocean fisheries, fish stocks have rebounded or stayed level as sustainable management systems placed catch limits on species in certain areas. But these are under threat, too.
"Those systems are based on historical patterns that no longer exist," Rader said. "Fish populations are already moving, and they're moving faster than anyone expected. Unless more agile management systems are put into place, all bets are off."
Despite all the alarming news in this week's report, the authors emphasized solutions and options — but stressed that they need to happen quickly, across all ecosystems, not just the oceans. Storing carbon in forests and soils will also prove critical.
"It's a call to action," Levin said of the report. "The mitigation solutions that involve the ocean include protecting natural carbon storage and enhancing it through restoration of mangroves, salt marshes and sea grass beds. We can reduce emissions on the ocean by reducing shipping emissions. ... The ocean can be involved in the solutions."
Better management of fisheries and policing of illegal fishing also will help save fish stocks, as will setting aside large and more marine protected areas, among other measures. But reducing the fossil fuel emissions that drive ocean warming and all its cascading effects remains the critical priority.
"If we can reduce emissions ... we can substantially reduce the scenario we project," Cheung said. "If we engage with sustainable management and consumption of seafood, our report suggests that good resource management can increase the resilience of fish stocks to climate change."

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