There is increasing pressure on states to curb their emissions and protect the climate. Government policy and lawmaking, which are initially driven by public opinion and social norms, are influenced by both domestic and international judgments and advisory opinions. This has a direct impact on the business sector. This article explores the latest trends in both national and international environmental jurisprudence and their likely impact.

Trends in Environmental Litigation

A.    Domestic judgments in England and Wales

In the UK, key environmental litigation jurisprudence arises from the judicial review of planning decisions. A leading case is R (Finch on behalf of the Weald Action Group) v Surrey County Council [2024] UKSC 20 where the UK Supreme Court considered ‘downstream emissions’ (also referred to as “scope 3 emissions”), being emissions which arise in a business’s value chain. Scope 3 emissions result from the use and disposal of the product which a business produces. The Supreme Court held that downstream emissions arising from the combustion of fossil fuels need to be considered as an indirect significant effect of a project in the context of an environmental impact assessment. Accordingly, scope 3 emissions are reasonably foreseeable effects of a project that result from a project’s operation and use. 

The principle defined in Finch has since been affirmed in Friends of the Earth v Secretary of State for Levelling Up, Housing, and Communities [2024] EWHC 2349 (Admin) and Greenpeace Limited & Uplift [2025] CSOH 10. In the latter case all parties agreed that not considering downstream emissions in an environmental impact assessment is unlawful. This shows that the requirement to consider downstream emissions is a now well-established and accepted principle of law.

Further, in June 2025 and as a result of Finch, the Department for Energy Security & Net Zero published supplementary guidance for assessing the effects of downstream scope 3 emissions on the climate from offshore oil and gas projects. This guidance specifically highlights the paragraphs in the Finch judgment that establish that the environmental impact of a project must be fully understood and quantified and that it is irrelevant where the combustion of fossil fuels takes place for the purpose of analysing its environmental cost Following Finch, the Offshore Petroleum Regulator for Environment and Decommissioning concluded that environmental assessments must both clearly assess the magnitude of scope 3 emissions and contextualise these so that they are easily understood by decision makers and the general public. This supplementary guidance illustrates that environmental litigation is already having an impact on project developments in the UK.

B.    International judgments

In the international courts, there is evidence of what appears to be a strong trend of states being held responsible for violating their citizens’ human rights when failing to take measures to mitigate climate change. An example which demonstrates this is Verein KlimaSeniorinnen Schweiz and Others v. Switzerland - 53600/20, which was heard before the European Court of Human Rights. There, the Court held that Switzerland had violated the Applicants’ right to respect for private and family life (Article 8 of the ECHR) by failing to devise, develop and implement relevant legislation and measures to mitigate the effects of climate change in an appropriate and consistent manner. This judgment placed a duty on States to mitigate the effects of climate change. 

C.   Advisory Opinion of the International Court of Justice

In July 2025, the International Court of Justice (“ICJ”) rendered an advisory opinion on the obligations of states under international law in respect of climate change. The ICJ concluded that there is an obligation on states to prevent transboundary environmental harm, including by regulating greenhouse gas emissions. This obligation arises from customary international law. As such, states may be liable irrespective of their ratification of key climate treaties. The ICJ emphasised that due diligence obligations on countries extend to the regulation of private actors’ emissions.

Impact on businesses in England and Wales

A.    Influence on Policy Requirements

Both domestic judgments and international developments in the field of environmental litigation place a responsibility on the state to consider and mitigate the consequences of climate change. The ICJ’s Advisory Opinion places a direct responsibility on states to regulate the emissions of private actors, including businesses.

State responsibility  for taking steps to mitigate climate change is  likely to trickle down to companies through changed policy requirements and regulatory scrutiny.

B.    Shaping of Shareholder Expectations

In addition to pressure from governments, companies should additionally anticipate changing shareholder expectations. This can take the form of derivative shareholder actions against a board of directors as attempted in ClientEarth v. Shell plc [2023] EWHC 1137 (Ch).

In England and Wales, it is a director’s duty to promote the success of the company for the benefit of shareholders (section 172 of the Companies Act 2006). This includes considerations of the company’s impact on the environment, its long-term success and its reputation. Directors’ duties will, therefore, inevitably adapt: the interpretation of a company’s environmental impact is broadened by including downstream emissions; long-term success is affected by a company’s ability to adapt to changing policy requirements; and reputation is influenced by the perceived implementation of environment, social and governance initiatives.

C.   Risk of Future Claims

Different industries are increasingly exposed to environmental litigation. This can take the form of so-called “greenwashing claims” and polluter pays actions, as defined below.

Greenwashing claims investigate the accuracy of environmental claims made in advertising. The UK’s Advertising Standards Authority (“b”) has increased its scrutiny of environmental messaging in advertising since 2022, resulting in high-profile rulings against, among others, Lloyds Bank Plc in 2024 and TotalEnergies SE in 2025. UK ASA has repeatedly held that advertisements must provide all significant information relating to the company’s climate impact, including negative impacts.

Polluter pays actions are tort-based claims brought against companies for their contributions to climate change. While these have not been successfully brought in the UK to date, international developments in this field may result in an increasing willingness among the judiciary to accept environmental litigation arguments. Further, even when unsuccessful, polluter pays actions can result in legal costs defending such claims and negative press for the company.

Conclusion

While key developments in environmental litigation currently reframe the responsibilities of states towards their citizens, this effect is likely to trickle down to business in the future. In our view, companies and their directors will increasingly be required to consider their environmental responsibility and liability in decision making.

CANDEY is a boutique litigation law firm that has extensive experience and resources to evaluate and advise on international commercial litigation. In particular, we can guide clients through the duty of care litigation process, particularly assessing early on the difficult procedural and evidentiary challenges that type of litigation involves.

Note: This is a general summary of an evolving field of law, and is made available for general discussion purposes only between CANDEY and its clients and prospective clients. This memorandum does not constitute legal advice and must not be relied on as such. It should also not be cited as legal or academic authority