On 23 July 2025, the International Court of Justice (ICJ) quietly detonated a legal landmine, one that could reshape corporate risk, regulatory strategy, and accountability frameworks for decades to come.
In its much-anticipated advisory opinion, the ICJ didn’t mince words: climate inaction isn’t just immoral or inefficient, it’s unlawful. The ruling makes it clearer than ever that governments and corporations alike can no longer hide behind voluntary pledges or net-zero marketing. The legal ground is shifting beneath our feet, and if you're running a business, or advising one, you’d best be paying attention.
This wasn’t a new treaty or a surprise coup by climate activists. It was a request for legal clarity, put to the world’s highest court by the UN General Assembly, led by a coalition of small island states and propelled into motion by a youth-led campaign in the Pacific. What the court returned was a firm, legally grounded message: under existing international law, every country, and by extension, every entity operating within one, has binding obligations to protect people and the planet from the harms of climate change.
Liability Isn’t a Distant Threat, It’s a Boardroom Reality
The ICJ opinion doesn’t create new laws, but it stitches together a legal tapestry from existing international agreements, human rights conventions, and customary norms. The result? A legal framework that strengthens the hand of climate litigators and raises the stakes for both governments and corporates.
As of July 2025, there are 3,099 climate litigation cases active worldwide, according to Norton Rose Fulbright’s latest litigation tracker. That number is accelerating. The ICJ’s opinion is jet fuel for many of them. It provides authoritative backing to the idea that failure to reduce emissions, especially when a company or country has the resources to do so, may amount to a breach of international obligations.
We’ve already seen glimmers of this in national courts. Dutch courts ordered Shell to cut its emissions, citing human rights grounds. In the US, a group of youth plaintiffs in Montana won a landmark case against their state for promoting fossil fuels in violation of their constitutional rights. Germany’s constitutional court has ruled its climate law insufficient to protect future generations.
And then there’s the case of Saúl Luciano Lliuya v. RWE. A Peruvian farmer and mountain guide sued German energy giant RWE, arguing that its emissions, representing roughly 0.4% of global industrial CO₂, had materially contributed to glacier melt that now threatens to flood his town.
Another example is the ongoing case brought by 16 Puerto Rican municipalities against 11 fossil fuel majors, alleging that the defendants caused an intensification of the storms which Puerto Rico experienced in 2017. The case is progressing thanks to advances in attribution science, a field that enables scientists to link specific climate impacts to individual corporate emitters. With courts showing growing willingness to admit this science, fossil fuel companies, and potentially those enabling them, are increasingly finding themselves summoned to courtrooms far from their home turf. This is no longer hypothetical. It’s legal reality, and it’s accelerating.
These weren’t legal flukes, they were previews. With this ICJ ruling in hand, the next wave of lawsuits may go beyond delay and reputational damage. We’re talking fines, asset write-downs, and forced divestitures. Climate risk is now legal risk.
Corporate Strategy Just Became a Legal Document
If your climate strategy relies on long-term targets with soft interim steps, it’s time to sharpen your pencils, and your carbon math. The ICJ made clear that the Paris Agreement doesn’t stand alone; it’s part of a broader fabric of legal duties that includes the UN Charter and various human rights instruments.
Importantly, the Court affirmed that states have a duty to act with due diligence and to prevent significant transboundary harm. For multinational companies, this opens a new dimension of exposure. If your supply chain contributes to emissions or deforestation that harms another country, or violates the rights of vulnerable communities, you may not just be facing ESG backlash. You could be enabling state-level breaches of international law, with ripple effects all the way to your legal department.
The Lliuya v. RWE case is especially instructive here. As Imperial College London’s analysis shows, what once seemed legally and scientifically speculative is now seen as a legally credible claim. Courts are increasingly prepared to accept not only that companies contribute to climate change, but that they can be held directly accountable for the downstream consequences. That glacier in Peru? It may as well be melting under the weight of a European emissions ledger.
Fossil Fuels: The Investment That’s Now Wearing Handcuffs
The ruling stops short of banning fossil fuels outright. But it unequivocally reinforces the obligation to align emissions trajectories with the 1.5°C target. That target isn’t aspirational anymore. It’s a legal yardstick.
This matters deeply for fossil fuel producers and their investors. If you’re expanding oil and gas production in 2025, you’re not just betting against the IEA, the IPCC, and basic physics. You’re now operating in defiance of what the world’s highest court has recognised as legal obligations. That’s a litigation powder keg.
We’ve already seen the pushback: shareholders suing boards for failure to disclose climate risks, insurers refusing to underwrite new fossil fuel infrastructure, and regulators probing greenwashing claims. Now add to that: a potential class of plaintiffs invoking international law and human rights when your drilling rig floods their town or village.
Human Rights Meets Scope 3 - Suppliers in the Crosshairs: Enabling Emissions Is No Longer Risk-Free
One of the most profound elements of the ICJ’s opinion is the fusion of climate harms with human rights violations. The right to life. The right to health. Access to water, food, shelter. These aren’t abstract ideals. They’re codified in law, and they’re being infringed by rising seas, deadly heat, and crop failures.
For companies, this means ESG isn’t just a reporting exercise. It’s a potential liability exposure. Think about your Scope 3 emissions, not just as indirect carbon output, but as vectors of harm. If your logistics network contributes to pollution that disrupts health systems in the Global South, or if your financed emissions contribute to weather events that wipe out livelihoods, you may now find yourself tangled in a web of legal accountability.
Suppliers in the Crosshairs: Enabling Emissions Is No Longer Risk-Free
The implications of the ICJ ruling don’t stop at oil producers or utility companies. They reach into the supply chains, the digital systems, the consultancies, the very infrastructure that props up fossil fuel operations. If you provide products or services that help fossil fuel companies extract, transport, or sell hydrocarbons more efficiently, you are no longer insulated from scrutiny.
Let’s say you supply an ERP system, a predictive maintenance platform, or a digital twin solution that improves extraction efficiency. That system may now be seen as an enabler of unlawful climate harm. And while the ICJ ruling doesn’t impose direct corporate liability, it reaffirms that states have legal duties to prevent climate-related harm, including harm linked to business activities. That includes the activities of companies domiciled within their borders, even if the emissions themselves are exported.
This echoes a broader trend we’ve seen in other sectors. Arms manufacturers have faced litigation for supplying regimes that commit human rights abuses. Tobacco companies' logistics and packaging providers have come under fire. Now, fossil fuel enablers are under the spotlight. As attribution science tightens and legal norms evolve, more plaintiffs may begin to ask: who made this continued extraction possible?
The UN Guiding Principles on Business and Human Rights are clear: companies are expected to avoid contributing to adverse human rights impacts, and to mitigate any impacts they're directly linked to via their operations, products, or services. In this light, continued support for unabated fossil fuel expansion becomes not just a reputational issue, but a growing liability.
Prudent suppliers should act now:
Assess where your products or services are used to enable fossil fuel operations
Implement climate and human rights due diligence across client portfolios
Consider contractual clauses allowing disengagement from non-aligned clients
Publicly disclose fossil-related exposure and decarbonisation safeguards
The message is simple: if you’re helping fossil fuel companies run faster, cheaper, or longer, you’re no longer on the sidelines. You’re in the frame.
If you’re a corporate leader reading this, the message is clear: compliance is no longer about ticking boxes. It’s about demonstrating real-world, near-term emissions reductions, climate resilience, and respect for rights.
Here’s what smart companies should be doing now:
Stress-Test Climate Strategies: Use 1.5°C-aligned models. Don’t rely on net-zero pledges with long horizons and fuzzy offsets.
Map Legal Exposure: Assess where your operations intersect with vulnerable communities, carbon-intensive value chains, or high-risk regulatory jurisdictions.
Engage Boards and Legal Counsel: This is not just for the Chief Sustainability Officer. This is a C-suite and legal risk management issue now.
Divest Intelligently: Exit fossil fuel assets early. If you must remain exposed, ensure transparent, science-aligned decarbonisation plans.
Embed Rights-Based Due Diligence: Use tools like the UN Guiding Principles on Business and Human Rights. Align climate action with social protection.
This isn’t about altruism. It’s about license to operate, cost of capital, and long-term viability.
The Geopolitical Undercurrent
Let’s not pretend this ruling lands in a political vacuum. The ICJ has now joined a growing list of institutions—from the UN to the EU courts to national tribunals—acknowledging that delay is dereliction.
For countries, especially major emitters, this advisory opinion won’t be the last word. But it will influence the next. Whether it’s in climate negotiations, trade disputes, or aid flows, we’ll likely see this ruling cited again and again as a normative anchor.
And that’s the quiet genius of it: advisory opinions don’t carry direct enforcement, but they shape the landscape in which enforcement happens. They shift what’s politically and legally defensible. In other words, they redraw the red lines.
Conclusion: A Verdict Worth Listening To
As Martin Luther King Jr. famously said, "The arc of the moral universe is long, but it bends toward justice." With this ruling, the ICJ has given that arc sharper definition—and stronger legal teeth.
The ICJ didn’t issue a climate wish list. It delivered a legal diagnosis: climate harm is a rights violation, climate inaction is a breach of duty, and every actor, from parliaments to procurement officers, must now operate with this in mind.
If you’re a business leader, take this as a warning shot across the bow. The days of climate inaction being framed as a policy choice are over. They’re now a potential legal liability, a fiduciary breach, a reputational risk, and, frankly, a moral failure.
So read the full ICJ advisory opinion here, and check out Carbon Brief’s excellent summary here. And for more on attribution science's courtroom impact, read Imperial College's deep dive here.
Because this ruling isn’t just about what governments must do. It’s about what all of us must stop ignoring.
The countdown to climate accountability has officially begun, and the arbiters are now judges, not just scientists or activists.
This post was first published on TomRaftery.com. Photo credit RB Photo on Flickr