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The role of law in driving sustainability

Posted on 1 August 2022

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We face urgent and escalating challenges which are putting pressure on our planet's resources and social norms. Immediately, these include the lasting effects of the COVID-19 pandemic, the war in Ukraine, and a looming global economic crisis; but also, existential threats to the fabric that sustains life – our climate, biodiversity and natural systems.

These challenges are different from those of the past; they are now global in nature and systemic in effect. Today's context is different too. We are beginning to understand that human activity is now the dominant influence on our climate and the environment – bringing us into a period called the Anthropocene – and that our planet is no longer sustainably able to meet our demands. The urgency of the situation is escalating as ecological tipping points are reached and evidence of the inter-connectivity between environmental stress, health and security crises becomes clearer. Business as usual will not only afford our children a poorer quality of life in the future; it is jeopardising the most vulnerable in society today.

The political and economic architecture of the past 70 years or so has been hugely successful. It has delivered astronomical economic growth, lifted millions out of poverty and enabled a dramatic increase in life expectancy and reduction in child mortality. Despite these achievements, long-standing problems remain unaddressed and new challenges have grown and emerged. Our existing frameworks are struggling to address today's challenges, and a concerted effort at reform is needed to accelerate a transition to a sustainable future.

To underpin this transition, in 2015, all United Nations Member States adopted The 2030 Agenda for Sustainable Development. This provides a shared blueprint for peace and prosperity for people and the planet, now and into the future. At its heart are the 17 Sustainable Development Goals (SDGs), which are an urgent call for action by all countries - developed and developing - in a global partnership. They recognize that ending poverty and other deprivations must go hand-in-hand with strategies that improve health and education, reduce inequality, and spur economic growth – all while tackling climate change and working to preserve our oceans and forests. Many of the SDGs have been enshrined into legal commitments, to provide a supportive framework for the transition. If we are to survive and flourish, we need radically to accelerate progress.

The law is a key element in the achievement of the SDGs and the transition to sustainability. As a potent tool, it can be used to drive change. Further, it is a complex system with multiple influences, which may be determinative of the speed and nature of the transition. The law is critical in ensuring accountability and addressing the inherent issues of fairness and equity which are entwined with the roots of almost every facet of these new challenges and the transition. In this way, the law can be seen both as an agent for change, and as a part of the very architecture which needs reforming.

This short article is intended to provoke discussion around two key questions:

  • First, why there is limited discourse and focus on the role of law in the transition to sustainability? and
  • Second, how can the law be used more actively to accelerate progress towards our goals?

The role of law

Law provides a set of principles and regulations established in a community by some authority and applicable to its people, whether in the form of legislation or of custom and policies recognised and enforced by judicial decision. The roles of law can be organised in different ways.

From a practical perspective, the five main roles of law are 1) to articulate and set rules; 2) to regulate the government of a state; 3) to regulate the relationship between a state and its subjects; 4) to regulate the relationship and conduct between private individuals; and 5) to resolve disputes. Its indirect functions include to determine procedures for changing the law and to regulate the organs that administer the law.

Alternatively and from an academic perspective, the roles of law have recently been conceptualised as 1) steering transition to certain ends, 2) slowing transition down, and 3) accelerating transition.

From a sustainability perspective and for the purposes of this paper, we have articulated seven roles of law, which we see as central both to achieving the SDGs and to enabling an urgent, safe and equitable transition towards a sustainable future.

Communicating values

Law, at its very foundation, is conceived and derived from values. These values inform and underpin a rational and fair expectation of how power should be organised, exercised and controlled at a private and public level. Essential human values that transcend cultural or geographical boundaries have been recognised in international charters such as the Universal Declaration of Human Rights and the SDGs, which are intended to form blueprints for sustainable and equitable living.

Values are in a constant state of flux, from which societal relations are settled and resettled, at the confluence of the law and politics. The way in which we address today's challenges will be determined by reference to our values and the interactions between the law, lawyers and the political sphere.

Importantly, where global challenges have differential impacts on countries or communities, the recognition of universal values can be incredibly powerful in negotiating and determining new frameworks and actions. This is especially the case when considering fairness, for example in balancing the costs and benefits of decarbonising our economies and protecting local environments that underpin global weather systems. Enshrining common values into international law may become increasingly important in enabling the transition to sustainability as nation states seek to agree common frameworks, business seeks to establish new standards, and markets look to allocate capital effectively.

Setting standards

Standards should reflect the expectations of society; however, the organic development of 'hard law' and regulation often lags behind changes in social norms and political developments. Given the urgency of the challenges we face, this approach alone will not drive the required rate of transition to sustainability.

Countries are increasingly adopting globally progressive policies and developing ambitious legal frameworks to drive transformative change and accelerate the transition. For example, the UK and others have set net-zero goals in law and the EU is implementing an ambitious legislative agenda in support of its Green Deal. 3

The business sector, especially international companies, are increasingly adopting a model of self-regulation in relation to Environmental, Social and Governance (ESG) factors. The emerging melee of sustainability frameworks, standards and charters is noisy and confusing, but reflects the increasing importance of this emerging paradigm of standard setting across international boundaries in the absence of common legal and regulatory frameworks. We expect significant convergence over the coming years around a set of self-regulatory standards.

Holding to account

Courts, tribunals and regulatory authorities are essential for adjudication and holding parties to account before the law. Some courts and regulators have shown an interventionist appetite in the context of the sustainability challenges. For example, courts in some jurisdictions have been increasingly willing to rule on the developing fiduciary duties of company boards in the context of climate action and responsibility for group company behaviour. See, for example, Milieudefensie et al., v Royal Dutch Shell [2019] HA ZA 19-379 and Vedanta Resources PLC and another v Lungowe and others [2019] UKSC 20.

Antitrust regulators in several jurisdictions have made statements aimed at providing comfort to private companies wishing to work together to tackle sustainability challenges. Margrethe Vestager, the Executive Vice-President of the European Commission, recently declared that “all of Europe’s policies – including competition policy – will have their role to play” in achieving the European Green Deal.

In the UK, the Financial Conduct Authority in particular has made it clear that financial services and markets also have a central role in the transition to a low carbon economy and a more sustainable future. The FCA has committed to supporting the Government's commitment to achieving a net-zero economy by 2050 "by adapting [its] regulatory framework to enable a market-based transition."

Elsewhere, new environmental regulators are being set up. In the UK, the Environment Act 2021 established a new statutory Office for Environmental Protection, whose role is to monitor the implementation of environmental law by public authorities. These trends seem set to continue.

Ensuring fairness

The rule of law is the political philosophy that all citizens and institutions within a country are accountable to the same laws. It enshrines the notion of equality before the law, secures a non-arbitrary form of government and prevents the arbitrary use of power. The concept is synonymous with fairness.

The transition to sustainability requires changes, which differentially impact individuals, communities, corporations and countries. This is particularly evident in the context of the imperative to decarbonise our economies, where notions of fairness are engaged not only in terms of geography, vulnerability and ability, but also temporally. The question of who should bear the cost of decarbonisation and when it should be done, is a moral one, just as much as is it one of practicability.

Governments are considering how to employ taxation schemes to drive decarbonisation within their own jurisdictions. In July 2021, the EU Commission adopted a proposal for a new carbon border tax which would put a carbon price on imports of a targeted selection of products in an attempt to avoid 'carbon leakage' in the wake of EU climate action. Whilst the effect of this policy intervention is clear at a European level, there is much discussion as to the equity of the impacts this has on market participations outside of the jurisdiction. A serious concern is whether it is fair to expect industries in developing countries to decarbonise at the same rate as developed countries.

Protecting individual rights and liberties

In the context of sustainability, the law can be a tool to protect the natural environment as well as those affected by unsustainable and harmful practices. Policy tools such as regulations and standards specify compulsory requirements related to climate–relevant behaviour and technologies.

Similarly, human rights law affords protection to individuals which spans jurisdictions. The European Convention of Human Rights enshrines the right to life and right to privacy in Europe, as does the Human Rights Act 1998 in the UK. The Human Rights Act outlines the basic human rights and principles of equality, which encompass fairness, respect, dignity and autonomy. Domestic legislation is slowly recognising the necessity to afford the natural environment more adequate protection and rights, in the same way we do to individuals and companies.

Protecting the most vulnerable

In 1990, the Intergovernmental Panel on Climate Change (IPCC) reported that the greatest single impact of climate change could be on human migration flows, with millions of people being displaced from their homes by factors including coastal flooding and agricultural disruption. The 2020 report by the Internal Displacement Monitoring Centre gave weight to this, stating that in 2019 alone nearly 1900 environmental disasters (the vast majority being weather related) triggered 24.9 million new displacements across 140 countries and territories.

Many aspects of domestic and international law recognise that vulnerable individuals and communities require protection. However, current international law does not provide a right to admission and stay for those fleeing to another country in the context of disasters and the effects of climate change. Climate migrants are not recognised in any binding international treaty, nor is there an international body that is responsible for identifying, monitoring and ensuring the protection of these individuals.

Without the law identifying and providing a mechanism for these individuals to be dealt with in an appropriate manner, there is a concern that this current legal (and political) lacuna will leave individuals unprotected and countries overwhelmed.

Providing a framework to resolve disputes

The law offers disputants various means to resolve their disputes and encourages cooperation and settlement prior to engaging in litigation. Central to the operation of the Rule of Law is that judicial and other adjudicative procedures must be fair, independent and accessible.

Legal issues in sustainability-related disputes traverse multiple fields of law and carry various causes of action. Actors are using increasingly diverse ways to resolve these disputes, which include making use of judicial review, statutory frameworks, human rights, shareholder activism and international laws.

 

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