Banks and climate litigation risk: navigating the low-carbon transition

Smolenska, Agnieszka ORCID: 0000-0001-7703-7686, Chan, Tiffanie ORCID: 0009-0003-2405-7749, Poensgen, Ira and Higham, Catherine ORCID: 0009-0005-0938-0067 (2024) Banks and climate litigation risk: navigating the low-carbon transition. . Centre for Economic Transition Expertise (CETEx), London School of Economics and Political Science, London, UK.

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Abstract

Over the past decade, climate-related litigation targeted at both public and private actors has mushroomed. This includes some high-profile cases brought directly against banks. Such litigation trends pose material financial risks to banks. In addition, credit institutions need to manage risks related to the rapidly evolving landscape of climate litigation against corporate clients. How banks identify, manage and mitigate these novel legal risks is of strong relevance from the perspective of prudential policy and the effectiveness of transition policies more broadly. To respond to this challenge, this report investigates how credit institutions engage with climate- and environment-related legal risks. It explains how insights from bank current practice, such as gaps in their legal risk management approaches, should be addressed with targeted prudential policy interventions.

Item Type:	Monograph (Report)
Additional Information:	© 2025 The authors
Divisions:	Grantham Research Institute
Subjects:	K Law > K Law (General) H Social Sciences > HG Finance Q Science > QC Physics
Date Deposited:	29 Aug 2025 23:04
Last Modified:	29 Aug 2025 23:04
URI:	http://eprints.lse.ac.uk/id/eprint/129325

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