By Nelushi Dissanayake
Photo by @aliiiiiiishaa
How should the legal profession respond when climate change itself becomes the most pressing social justice issue of our time?
Climate change is no longer a distant environmental concern. It is a legal and governance crisis with implications for society. Rising global temperatures, more frequent natural disasters and destabilised ecosystems create not only a physical risk but legal, financial and ethical ones. More and more corporations, governments and individuals turn to the law to allocate responsibility, mitigate harm and create a sustainable path forward. But what role should the legal profession play when climate risk directly challenges the structures of governance and justice?
I CLIMATE CHANGE AS A GOVERNANCE CHALLENGE
At the core, climate change raises questions of governance: who should bear the costs of environmental degradation, who should be held accountable for harm, and how should risk be distributed across society? In Australia, directors’ duties under the Corporations Act 2001 (Cth) have come under scrutiny for their application to climate-related financial risks. In ASIC v Mariner Corporation Ltd, the Federal Court confirmed that directors must exercise care and diligence in assessing foreseeable risks, including those with financial and reputational consequences. Climate risk nearly falls within this scope.
Additionally, legal commentary such as the Hutley opinions, has argued that climate change constitutes a material financial risk that directors are legally obliged to consider. Failure to do so may expose boards not only to shareholder action but regulatory enforcement. Governance structures must therefore adapt to integrate climate considerations into their decision-making frameworks, or risk breaching core fiduciary duties.
II FROM DISCLOSURE TO ACCOUNTABILITY
The regulatory landscape is evolving to address these concerns. Australia is implementing mandatory climate-related financial disclosures aligned with international standards. These regimes require corporations to measure, report and manage their exposure to climate risk. The rationale is clear: disclosure promotes transparency, enabling investors and consumers to make informed choices.
However, disclosure alone is insufficient. As recent scholarship has noted, mere reporting does not ensure meaningful change in corporate behaviour. Disclosure regimes risk becoming a “tick-the-box” exercise, with corporations publishing glossy sustainability reports while continuing harmful practices – a phenomenon described as greenwashing. In ASIC v Mercer Superannuation (Australia) Ltd, the Federal Court recently signalled a growing judicial willingness to hold companies accountable for misleading environmental claims.
III THE SOCIAL JUSTICE DIMENSION
Why does climate risk matter for social justice? Because its effects are distributed unequally. Vulnerable communities, including low-income households, Indigenous peoples and those in developing nations, bear the brunt of climate impacts while contributing least to the problem. Legal frameworks that fail to address these inequities risk entrenching injustice.
ClientEarth’s litigation against Shell’s directors in the UK illustrates this intersection of governance and justice. It was alleged that the board’s failure to adequately plan for netzero emissions breached directors’ duties to promote the success of the company. Although the claim was dismissed, the case represents a growing trend, using legal structures to force corporate actors to internalise the social and environmental costs of climate inaction.
In Australia, the debate extends beyond corporations to government accountability. Cases such as Sharma v Minister for the Environment highlight attempts to recognise a duty of care owed by the state to younger generations exposed to climate harms. Although overturned on appeal, the litigation reflects a broader societal demand for governance structures that protect future rights.
IV A ROLE FOR LAWYERS
The legal profession sits at the intersection of these issues. Lawyers draft disclosure frameworks, advise boards on governance risks, litigate climate-related claims and shape regulatory reform. With this influence comes responsibility. If lawyers confine themselves to narrow compliance-based advice, they risk enabling the very systems that perpetuate climate harm. Conversely, by embedding climate justice into governance advice, legal professionals can drive systemic change.
As Professor Sarah Barker observes, climate change is not merely an “ethical” issue but a core financial, legal and strategic concern. To ignore it is not neutrality but complicity. Social justice in the era of climate risk requires the legal profession to see the climate itself as a client, one whose interests are inseparable from those of society.
VI CONCLUSION
Climate risk and governance represent more than technical corporate compliance; they embody a pressing social justice issue with implications for equity, accountability and human survival. Disclosure regimes, directors’ duties and litigation strategies all form part of an emerging legal architecture grappling with climate realities. But the true measure of justice will not lie in what was reported, but what was transformed. As the climate crisis accelerates, lawyers are uniquely positioned to ensure that governance frameworks serve not only markets but also communities, future generations and the planet itself. In the face of climate change, law cannot be neutral, it must be just.