Book contents
- Companies and Climate Change
- Cambridge Studies on Environment, Energy and Natural Resources Governance
- Companies and Climate Change
- Copyright page
- Dedication
- Contents
- Acknowledgements
- 1 Introduction
- 2 Theorising the Company in the Context of Climate Change
- 3 English Company Law and Climate Change
- 4 International and Transnational Climate Change Law and Policies
- 5 Domestic Climate and Energy Regulation
- 6 Companies, Human Rights and Climate Litigation
- 7 Fiscal Barriers and Incentives to Corporate Climate Action
- 8 Conclusion
- Index
3 - English Company Law and Climate Change
Published online by Cambridge University Press: 09 April 2021
- Companies and Climate Change
- Cambridge Studies on Environment, Energy and Natural Resources Governance
- Companies and Climate Change
- Copyright page
- Dedication
- Contents
- Acknowledgements
- 1 Introduction
- 2 Theorising the Company in the Context of Climate Change
- 3 English Company Law and Climate Change
- 4 International and Transnational Climate Change Law and Policies
- 5 Domestic Climate and Energy Regulation
- 6 Companies, Human Rights and Climate Litigation
- 7 Fiscal Barriers and Incentives to Corporate Climate Action
- 8 Conclusion
- Index
Summary
This chapter provides a deep dive into UK company law, assessing the common law before the changes to the Companies Act enacted in 2006. It finds that prior to 2006, the judiciary provided directors with a significant amount of discretion to make even profit-sacrificing actions if they benefited the company as a whole, widely reflecting the entity theory of companies. Corporate governance reviews, from the Cadbury Report onwards, did not reflect this common law approach. A detailed examination of the work of the Company Law Review Steering Group illustrates that the changes codified in s172 of the Companies Act 2006 actually entrenched a shareholder primacy approach to company law that previously was not dominant in English common law. This development could have negative impacts for the climate, although the relationship between s172 and the prior common law interpretation of directors’ duties remains unclear. Post-2006 cases are also assessed, and an overview of where climate liability could arise for directors under the 2006 Act is provided.
- Type
- Chapter
- Information
- Companies and Climate ChangeTheory and Law in the United Kingdom, pp. 46 - 77Publisher: Cambridge University PressPrint publication year: 2021