Will Energy Firm Executives Be Sued for Ignoring Climate Change?

Environmental groups said executives of coal, oil, gas and other “fossil fuel” companies could be held liable and risk lawsuits if they support groups that deny climate change and resist policies to fight it.

In the current legal environment, however, the bar to prove such an allegation remains extremely high, Robert Hartwig, president and economist at the Insurance Information Institute, told Carrier Management.

“For an individual to be found liable, or for a company to be found liable, it has to be demonstrated in a court of law that there was some type of negligence that resulted in actual, specific damages to life or to property,” Hartwig said. “And so to allege that a particular point of view on a particular issue can somehow be tied to a specific instance of injury or property damage, there would be a high threshold to meet.”

Greenpeace International, the World Wide Fund for Nature and the Center for International Environmental Law disclosed recently that they collectively wrote executives of “large insurance corporations” and also CEOs of “fossil fuel” and related companies about the issue. Specifically, they inquired about who would cover for the liability if their directors or officers are hit with a lawsuit for denying climate change or resisting actions to address it. They plan to publish the responses from both the companies and insurers at www.greenpeace.org.

“As the impacts of climate denialism and regulatory obstruction become clear, we want to understand how corporations, insurers and officers and directors are allocating those risks among themselves, ” Carroll Muffett, president of the Center for International Environmental Law, said in a statement. “Just as importantly, we ask what steps they’re taking to prevent the misconduct that creates those risks in the first place.”

Samantha Smith, head of the WWF’s Global Climate and Energy Initiatives, said the three organizations hope their letter to insurance and company execs will “bring attention to the importance of truthful, transparent and responsible corporate reporting and policy engagement on climate change.”

Hartwig said that there have been efforts in the past to sue various corporations based on the view that they contributed to climate change, and as a result, contributed to particular events such as hurricanes.

“They have not been successful,” Hartwig said. “There are legal standards, legal tests, and certainly, an entity cannot be held liable for its support of a particular organization or particular point of view. One could actually allege that there are first amendment rights that could be brought up here.”

He added “the science of climate change is not as such that you can tie any given or particular event to a particular concentration of greenhouse gases in the atmosphere.”

“Even if that was the case,” Hartwig wondered, “how would you tie that back to an individual defendant?”