Transition plan requirements consultation

ClientEarth advocates for the UK government to mandate the development, disclosure, and implementation of transition plans aligned with the Paris Agreement. The organization argues that a 'comply or explain' framework is insufficient and that mandatory requirements are necessary to prevent 'greenwashing' and 'say-do gaps'. It specifically highlights the need for pension schemes to manage systemic climate risk through Paris-aligned anchors and robust stewardship. ClientEarth further asserts that legal risks for directors are often overstated due to the 'dishonesty standard' in English law, and that alignment with the 1.5°C goal is essential for the UK to fulfill its international obligations following the 2025 ICJ Advisory Opinion.

• ClientEarth supports mandatory requirements for companies to develop, disclose, and implement transition plans aligned with the Paris Agreement temperature goal, arguing that a 'comply or explain' framework would 'perpetuate market failure' and fail to provide consistent disclosures.
• The document argues that omitting an implementation requirement creates a 'say-do gap' that exposes firms to greenwashing allegations and undermines real-world decarbonisation.
• Legal liability for directors and companies regarding transition plan disclosures is considered low under English law because a 'dishonesty standard' typically applies, meaning liability is unlikely if directors act honestly and reasonably.
• The UK's transition planning requirements should be anchored in the Paris Agreement to ensure the government meets its international law obligations, specifically citing the International Court of Justice’s (ICJ) 2025 Advisory Opinion regarding the regulation of private actor emissions.
• For pension schemes, ClientEarth recommends mandatory forward-looking public disclosures and the use of a 'Paris-alignment anchor' to set strategic ambition and interim targets, as current UK laws do not obligate pension funds to align with net zero by 2050.
• Pension trustees are urged to use more effective stewardship tools beyond simple dialogue, including bondholder stewardship, rules-based denial of capital, and the use of covenants to make transition conditions legally binding.
• The use of carbon credits for 'offsetting' is identified as a major threat to the integrity of transition plans and a source of legal risk due to the 'fundamental non-equivalence' between credits and actual GHG emissions.
• To mitigate the challenges of alignment, the government should provide guidance on 'meta criteria' for selecting credible, science-based reference pathways, such as those proposed by the Assessing Transition Plans Collective (ATP-col).

APA

ClientEarth (2025). Transition plan requirements consultation. https://www.clientearth.org/media/o3igrwbl/ce-response-to-transition-plan-requirements-consultation-september-2025.pdf

Chicago

ClientEarth. Transition plan requirements consultation. 2025. https://www.clientearth.org/media/o3igrwbl/ce-response-to-transition-plan-requirements-consultation-september-2025.pdf.

Wikipedia

{{cite press release |author=ClientEarth |title=Transition plan requirements consultation |date=September 2025 |url=https://www.clientearth.org/media/o3igrwbl/ce-response-to-transition-plan-requirements-consultation-september-2025.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{clientearth2025transition, author = {{ClientEarth}}, title = {{Transition plan requirements consultation}}, publisher = {ClientEarth}, year = {2025}, month = sep, url = {https://www.clientearth.org/media/o3igrwbl/ce-response-to-transition-plan-requirements-consultation-september-2025.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }