The first climate change lawsuit against the government: O'Donnell v The Australian Commonwealth


Katta O’Donnell, an Australian student, has filed the world-first climate change case against the Australian government. She is suing the government for failing to disclose the threat of climate change to investors in sovereign bonds.


A sovereign bond is where investors lend money to the government. Just like other bonds, the government promised to repay the money in the future, as well as interest in the meantime. They are perceived as the “safest form of investment” according to experts.


What happened?


O’Donnell argues Australia’s inadequate climate change policies, “ranked among the lowest in the industrialised world”, posed a threat to the economy. Hence, this is why she proclaims that the government should disclose information documents to sovereign bond investors regarding the climate-related risks.


By concealing this information, the federal government breaches its legal duty. It claims that the government has engaged in “misleading and deceptive conduct”, and government officials breached their “duty of care and diligence”.


A report from leading barristers demonstrated that government officials who fail to disclose information about the climate risk could be found responsible for breaching their duty of care and diligence.


What is the lawsuit?


A statement filed with the Federal Court of Australia in Victoria state claims that “Australia is materially exposed and susceptible” to threat posed by climate change. It alleges that Australia’s economy will be remarkably affected by how the government deals with climate change. Therefore, the investors should be entitled to know those risks as it can significantly affect an investor’s decision to buy sovereign bonds.


O’Donnell is declaring that the Australian government should disclose the inadequate climate change policies to investors and “injunction pausing further promotion of such bonds until it complies” according to BBC news.


How do climate risks pose a threat to sovereign bond?


The ris