Opinion – Rodrigo Tavares: Attention, companies, climate litigation is coming

When opening a branch of a company in Brazil, a well-known Brazilian banker warned me: “save everything but lawyers”. The judicialization of corporate activities, together with hyper-bureaucratization and Visigothic taxation, are the tottering tripod on which Brazilian companies are based.

More than 60 million lawsuits involving companies are being processed in the Brazilian judiciary, mainly of a labor, civil nature (contracts and indemnities) and related to Consumer Law. A Brazilian CEO has to know the factory floor as well as the floor of the courthouse in his region.

It is a scenario that will become more acute with climate litigation, a tool to be used by civil society to get companies and governments to account for the climate agenda. Although the first lawsuits date back to the 1990s in Australia and the US, it was with the historic victory in 2021 of an environmental group against Shell – in which a Dutch court ordered the company to establish a 45% cut in its emissions of carbon dioxide. carbon by 2030 – which has opened a new chapter. It was the first time that a country’s judiciary forced a company to align itself with the Paris Agreement.

Today, according to the LSE, there are 548 ongoing court cases against companies or public entities for violations associated with climate change. In Brazil, there are 18, including a precautionary action by four non-governmental associations –Agapan, Ingá, Coonaterra-Bionatur and Ceppa– against a mining company for violating environmental licensing rules “in the face of a serious climate emergency”.

But in the country there is still no record of cases similar to Shell’s. And there is a lack of legal activism on the part of civil society. In Portugal, last week, a group of 12 young people, composed mainly of newly graduated lawyers and law students, created the association Último Recurso. Publicly, they presented as their mission to put the Portuguese state and the energy company Galp in court, accusing them of being the main responsible for the climate crisis in the country.

In statements to the column, the association’s management emphasizes that the legal basis of the processes derives from “civil liability (for violation of subjective rights and legally protected interests of citizens), fiduciary duties, financial risks and human rights”. In other words, the legal basis is broad and multidisciplinary. The issue of human rights occupies an important space because the UN recognized a few months ago that a clean, healthy and sustainable environment is a fundamental human right.

But it is easier for a worker to sue a company for simply failing to pay overtime than for an association to sue a corporation for contributing to global warming and operating on credit on the planet, affecting thousands. The association expects “resistance from the courts” given the “somewhat conservative propensity of jurisdictional decisions”, added by the “lack of preparation of the Portuguese judiciary to deal with environmental and climate issues,” say Mariana Gomes (president), Beatriz Cunha (vice-president ) and Pedro Marques (treasurer), by email.

In both São Paulo’s Brazil and Lisbon’s Portugal, the corporate world operates in spaces of trust and camaraderie. The young Portuguese lawyers point out that many carbon companies “are deeply embedded in the status quo, whose sustainability is recognized by structures and organizations that are also integrated into this status quo.” To overcome the climate crisis, it is therefore necessary to “leave business as usual behind.”

Young Portuguese people have a pedigree in this area. In 2020, four children and two adolescents, aged between 8 and 21, were the authors of a lawsuit that was filed with the European Court of Human Rights, against 33 States, including Portugal, for the lack of concrete actions to reduce greenhouse gas emissions.

The Brazilian legal system, like the European one, also allows for climate litigation.

The Law on the National Policy on Climate Change (law 12,187/09); the Paris Agreement, ratified by Brazil in September 2016; the understanding of the STF on the legal scope of article 225 of the Federal Constitution of 1988, which determines that everyone has the right to an ecologically balanced environment, with the collective duty to defend and preserve it for present and future generations; the Brazilian Forest Code; and a constellation of rules associated with Environmental Law, Consumer Law and Civil Liability encourage companies and public authorities to meet climate mitigation or adaptation objectives.

Despite the inducing role of international organizations such as ClientEarth or the Global Action Network (Glan), taking the climate emergency to court carries costs that are difficult for young activist lawyers to bear. Last Resort itself has no external funding and will contact “foundations, organizations and private donors” to raise funds.

But which private donors? If most Brazilian or Portuguese philanthropists are entrepreneurs, isn’t there a risk of conflicts of interest? Might not a businessman, by the charm of philanthropy, be tempted to finance anti-competitive actions? And can public resources from the European Union, the biggest funder of the world’s climate agenda, be made available for civil society to sue governments, including EU members themselves?

The path will be arduous, but it is unstoppable. If in recent years the STF has been urged to interfere in the executive branch to avoid political calamities, it will also be the courts that encourage company executives to comply with rules to avoid environmental catastrophes.