Our key takeaway: Being a Board director today looks very different to being a director ten years ago. And this will look very different again in ten years time. Why? Climate transition will now need to be at the heart of corporate strategy for any company wanting to still be here in the future. What is the role of directors in this context? Understanding and tackling climate transition is not a nice-to-have for directors, it’s a must-have. To discharge their duties as fiduciaries of the company, directors must integrate climate risks and opportunities into their governance roles. They are increasingly subject to disclosure regulation as well as litigation - including against themselves individually as directors. Although the specific risks to directors differ depending on the jurisdiction, there are a number of actions that any forward-looking director would be well-advised in taking. This starts by asking the right questions of the board.
The Commonwealth Climate and Law Initiative (CCLI), with the Climate Governance Initiative (CGI), has released a Primer on Climate Change: Directors’ Duties and Disclosure Obligations (Second edition, July 2022):