Yesterday marked “Earth Overshoot Day”, the date on which it has been calculated that humanity’s demand for ecological resources and services in 2021 has exceeded what the earth can restore or regenerate this calendar year.
With 1,841 climate litigation cases ongoing or concluded as of May this year, companies (and their insurers) will be concerned that loss of natural capital and biodiversity may be the next ESG pressure and a future liability exposure.
Already this year we have seen a case brought against French supermarket, Casino, by indigenous peoples from the Brazilian and Colombian Amazon and NGOs from France and the US seeking the (relatively modest) sum of USD 3.7 million. The claimants allege that Casino sourced beef from local suppliers who have contributed to 50,000 hectares of deforestation.
The case, which relies on the French statutory “duty of vigilance” may, if successful, encourage others to bring similar cases against companies for environmental violations in their supply chains.
More broadly, a forthcoming EU directive will oblige larger companies to conduct due diligence into their value chains and to find and report on violations of environmental and human rights standards.
Against this backdrop, it is inevitable that companies will increasingly face “soft” pressure from consumers, investors and other stakeholders to properly map and assess such risks, particularly given the wealth of information that is now available in respect of resource consumption and climate change.
Earth Overshoot Day marks the date when humanity’s demand for ecological resources and services in a given year exceeds what Earth can regenerate in that year. In 2021, it falls on July 29.