Businesses face an expanding range of lawsuits related to environmental, social and governance issues, and cases alleging liability for biodiversity loss could gain traction as regulatory and disclosure frameworks evolve, experts say.
Biodiversity lawsuits are a fraction of the number of climate-related cases filed to date, said Nigel Brook, London-based partner at Clyde & Co. LLP. “It’s very early days. In Europe, the main source of biodiversity cases has been about supply chains,” he said.
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Whereas the EU has a statutory framework, at least in draft form, that sets out how claimants might pursue claims related to environmental harm, in the U.S. this is happening at the Securities and Exchange Commission enforcement level and the private securities plaintiffs level, said William Passannante, a shareholder with Anderson Kill P.C. in New York.
“In the U.S., so far we’ve got a differing approach to how those liabilities might increase. … It’s just an acknowledgment that there are new types of disclosure obligations that can form and potentially (lead to) materially misleading statements,” Mr. Passannante said.
Because these securities claims are novel, “they’re likely to be expensive” and generate directors and officers coverage litigation, he said.
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