The Climate Principles for Enterprises are a follow-up project to the Oslo Principles, launched at King’s College London in 2015. Whereas the Oslo Principles chiefly formulated the obligations of States in the face of climate change, the Climate Principles for Enterprises focus on enterprises and investors. Both projects aim to further the discussion on what specific entities must concretely do in the face of climate change from a legal perspective.
Comprised of experts in international, environmental, tort, human rights and company law, the Expert Group on Climate Obligations of Enterprises has worked over several years to formulate the Principles based on its interpretation of the law as it stands or will likely develop. In doing so, it hopes to spur a concrete debate on the responsibilities of individual entities and therewith contribute to addressing the threat climate change poses to life, the environment and the economy.
According to the Expert Group, enterprises are under four kinds of obligations:
- Reduction of greenhouse gas (GHG) emissions from enterprises’ own activities;
- Reduction of GHG emissions from enterprises’ products and services;
- Consideration of suppliers; GHG emissions; and
- Procedural obligations on disclosure and impact assessment
In general, enterprises should reduce the GHG emissions of their own activities to the same extent as the country or countries in which those activities take place. That means that the burden will primarily be carried by enterprises in developed countries.
Investors can and many already do play an important role to stem the tide of climate change. The Climate Principles for Enterprises also aim to provide a legal basis for active investment management and investor engagement with enterprises on climate. The Principles aim to strike a balance between the need for investors to operate from a long-term perspective, which includes taking responsibility in addressing climate change, and achieving an adequate return for current beneficiaries.