Corporate directors in South-east Asia to get more guidance on climate governance
A guide launched by environmental law non-profit ClientEarth includes information on how companies can embed sustainability across board-level committees, among other initiatives
THE boards of companies in South-east Asia will have more guidance on climate-related legal risks and regulations, as well as governance requirements within the region.
Environmental law non-profit ClientEarth has launched a guide that aims to provide corporate directors with a framework for climate governance, including litigation risk that directors and corporations face regarding greenwashing and other climate-related liabilities, as well as key regulatory and market shifts in the region’s transition to a low-carbon economy.
It also includes information on how companies can embed sustainability across board-level committees, establish dedicated governance structures, assess climate-related risks and opportunities, set science-based climate ambitions, and ensure alignment throughout the company’s value chain.
“Companies that do not adequately consider and manage foreseeable climate risks, and those that cause harm through carbon-intensive operations that exacerbate the climate crisis, are increasingly facing legal action,” said ClientEarth on Friday (Nov 8), in a joint press statement with Earth On Board and Climate Governance Malaysia.
Earth On Board is a non-profit that equips corporate directors to be proficient in sustainability matters.
Climate Governance Malaysia is the country’s chapter of the World Economic Forum’s initiative on climate governance.
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Directors may also face personal liability for failing to act reasonably in steering the corporation to manage foreseeable climate risks, if the company is found liable in a climate lawsuit, read the press statement.
It also noted the adoption of several reporting standards in South-east Asia, such as those from the Task Force on Climate-Related Financial Disclosures and the International Sustainability Standards Board, as well as the emergence of foreign regulations such as the European Union’s Corporate Sustainability Reporting Directive and Corporate Sustainability Due Diligence Directive.
“In response to these evolving reporting requirements and standards, corporate boards in South-east Asia play a pivotal role in navigating corporations through the challenges of climate change,” it said.
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“As stewards of corporate governance, they are in a unique position to steer their companies through regulatory changes and transition risks while ensuring that commitments to reach net zero can be effectively implemented and monitored,” read the statement.
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