An Australian student is suing the government for failing to disclose climate change risks to investors in sovereign bonds, in what lawyers believe is the first case of its kind.
The lawsuit filed in the Federal Court on Wednesday alleges Australia’s economy and reputation will be significantly impacted by the government’s response to climate change and that investors should be made aware of those risks, Sydney-based firm Equity Generation Lawyers said in a statement.
Kathleen O’Donnell, a 23-year-old student who owns Australian government bonds, is the lead claimant in the class action.
It comes after Australia suffered a devastating summer of bushfires that razed vast tracts of land, killing more than 30 people and an estimated billion animals.
Scientists say climate change is making fire seasons Down Under longer and more severe, while also burning in areas previously untouched by bushfire.
O’Donnell grew up in an area of rural Victoria state that has previously been ravaged by bushfires.
“Australia’s reputation is particularly impacted by the government’s failure to limit fossil fuel production and failure to have a credible plan to transition Australia to a low carbon economy,” her lawyers said.
“The lack of credible policies is expected to ultimately cost the economy when a sudden and disorderly transition occurs.”
Renewables accounted for just six percent of Australia’s primary energy mix in 2018, according to government figures, while the country is one of the world’s largest exporters of fossil fuels.
However the conservative government insists Australia will meet its Paris climate agreement target of reducing emissions by 26-28 percent on 2005 levels by 2030.
The country has just over Aus$600 billion ($429 billion) in sovereign bonds on issue, according to the Reserve Bank of Australia.
O’Donnell’s claim is seeking a court injunction to prevent Australia from promoting bonds without informing investors about climate change risks.
Her lawyers said it “is the first case in the world dealing with climate as a material risk to the sovereign bond market”.
Australia’s Treasury department said it “does not comment on matters concerning current court proceedings”.