Corporate Environmental Responsibility: "Business As Usual" Or Facing The Inevitable?

The insurance industry is in many ways on the front of environmental risks. This explains why many insurers are working to de-risk their financial exposure to the impacts of climate change.

That said, most D&O policies do not specifically address claims relating to climate change. Because most policies include pollution-related exclusions, insurers may be able to invoke such clauses to denying coverage in some circumstances. What is less clear, however, is how the courts will consider the liability of companies – listed ones in particular – and their directors and officers when it comes to disclosing climate change risks to their investors.

This was a point driven home last week in Toronto by Bank of England Governor Mark Carney. He cited figures showing that only a third of the world's top 1,000 companies are offering effective disclosure to investors about the potential impact of carbon pricing on their businesses.