Transition plan requirements consultation - ClientEarth response

Our Accountable Finance team focuses on the legal implications of climate change and other environmental issues for a wide spectrum of market participants, including banks, companies, investors, directors, professional advisers, stock exchanges and regulators.

This document responds to the Department for Energy Security & Net Zero (DESNZ) consultation paper on transition plan requirements. Among other things, our response builds on the conclusions of the Legal opinion on potential liability for climate-related transition plan disclosures produced by Erskine Chambers in June 2025.

ClientEarth supports the introduction of mandatory requirements for companies and firms in scope to develop, disclose and implement transition plans aligned with the temperature goal of the Paris Agreement.

In our view, this option:

• is necessary to deliver the Government’s policy objectives, particularly to support an orderly transition in line with global climate goals;
• is best aligned with the UK’s responsibilities under international law to regulate the emissions of private actors in within its jurisdiction, which are clearer than ever following the ICJ’s recent Advisory Opinion;
• will deliver the full range of legal benefits available to companies from the transition planning exercise, over and above the benefits available from simply disclosing a transition plan (which may or may not be aligned with the Paris Agreement and / or implemented in practice); and
• can be established without generating unacceptably heightened legal risk for reporting entities and their directors, including through the use of best / reasonable efforts qualifiers, where appropriate. Liability concerns do not justify the wholesale omission of alignment and implementation requirements.