Sound and Fury, Signifying Nothing: Why Shareholder Suits Are Ineffective to Promote Corporate Response to Climate Change

Abstract

Climate change has already impacted the planet in a number of ways. Perhaps most apparent, however, is climate change’s effects on the frequency and intensity of storms, droughts, and other major geologic and weather-related events. Such catastrophic events have also lead to significant loses by individuals and businesses alike. In particular, many corporations in areas most vulnerable to these sorts of catastrophes must adjust their corporate strategies to account and to prepare for the possibility of significant losses of property or business resulting from the effects of climate change. Some corporate boards, however, might be reluctant to take every step possible to protect the corporation against climate change related catastrophes due to the significant cost of doing so. As such, some shareholders might be unnerved by a board’s inaction on this matter, perhaps resorting to litigation against the board. This Note analyzes the potential success of such a shareholder claim, as well as the alternatives available to a climate-conscious shareholder.