Corporations & Climate Change: Directors' Legal Obligations & Litigation

Professor of Business Law Peer Zumbansen welcomes Professor Cynthia A. Williams, University of Illinois, as part of the 2021-2022 Seminars in Business & Society series. Professor Williams will deliver lecture on the obligations of corporate directors with respect to climate change.

Abstract

Our understanding of climate change has evolved from an “ethical, environmental” issue to one that presents foreseeable financial and systemic risks (and opportunities) over mainstream investment horizons. This evolution has substantially changed the relevance of climate change to the governance of corporations. A critical corollary of that evolution is that there are implications for the fiduciary duties of directors and officers.

This report provides an overview of contemporary evidence that climate change and the transition to a net-zero emissions economy presents foreseeable, material, and systemic financial risks that will affect corporations. It considers that evidence in the context of directors’ and officers’ fiduciary duties under Delaware law, particularly in light of recent case law on the duty of oversight.

In so doing, it sets out the practical circumstances in which a failure by directors or officers to have adequate regard to climate change-related issues could fail to satisfy the standard of conduct required to fulfill their duties and lead to potential litigation and liability exposures.

​The speaker

Professor Cynthia A. Williams joined Osgoode Hall in July 2013 as the inaugural Osler Chair in Business Law, a position from which she recently retired.

She also holds a part-time position as Professor of U.S. Corporate and Securities Law at the Vrije Universiteit (VU), Amsterdam. Prof. Williams is an emerita faculty member at the University of Illinois College of Law, and began her career practicing law at Cravath, Swaine & Moore in New York City. She writes in the areas of securities law, corporate law, and corporate responsibility, often in interdisciplinary collaborations, and engages in policy work in Canada, the U.K., and the U.S. through her board membership in the Climate Bonds Initiative, based in London; and as principal co-investigator and board member of the Commonwealth Climate and Law Initiative, part of the Oxford Sustainable Finance Program.