'Money is the oxygen on which the fire of global warming burns', Bill McKibben wrote in The New Yorker. The sentence captures a legal intuition that is now becoming visible in courtrooms: the climate crisis is not sustained only by industrial plants, pipelines and extraction sites, but also by the capital that keeps them economically alive.
The focus of climate litigation is therefore widening. The question is no longer only who emits, but also who finances, who selects, who insures, who invests and who makes carbon-intensive activities viable in the first place. This does not mean that banks are treated as if they were oil companies. Rather, it means that their decisions on credit, investment and risk governance are increasingly being read as part of the legal infrastructure of the transition.
The trend is not anecdotal. By the end of 2024, the Grantham Research Institute and the Sabin Center had identified 2,967 climate litigation cases worldwide, across nearly sixty jurisdictions; 226 new cases were filed in 2024, and a large majority of them were strategic rather than merely compensatory. Those figures matter because they show that climate litigation has become a method for shaping public policy, corporate conduct and market expectations, not simply a way of allocating damages after the event.
From states to companies to financiers
The chronology of climate litigation can be read, with some simplification, as a succession of three waves. The first wave targeted states. Urgenda Foundation v. the Netherlands remains its emblematic European example: in 2019, the Dutch Supreme Court confirmed that the Netherlands had to reduce greenhouse gas emissions by at least 25 per cent by the end of 2020 compared with 1990 levels. That state-centred logic has since travelled across Europe and beyond, from national courts to human-rights fora, culminating most visibly in Verein KlimaSeniorinnen Schweiz v. Switzerland, where the European Court of Human Rights held in 2024 that inadequate climate action may violate Article 8 ECHR.
The second wave moved from public authorities to non-financial corporations, especially oil and gas companies and other major emitters. Milieudefensie et al. v. Shell is the unavoidable reference point. The District Court of The Hague ordered Shell in 2021 to reduce its emissions by 45 per cent by 2030 compared with 2019 levels. The Court of Appeal later set aside that precise percentage, but it did not erase the deeper point: large corporations may be subject to climate-related duties of care, even where the exact content of those duties remains contested. This case is now before the Supreme Court of the Netherlands. Similar attempts can be seen, with different legal techniques, in Smith v. Fonterra in New Zealand, Asmania et al. v. Holcim in Switzerland, and in the Italian case known as La Giusta Causa against ENI, where the Italian Supreme Court, in its 2025 jurisdictional ruling, treated climate-related harm as capable of entering the structure of a civil-liability claim when connected to protected subjective rights.
The third wave is now taking shape around financial corporations. Its focus is not on whether banks directly emit greenhouse gases in the same manner as industrial companies, but on whether their decisions concerning lending, underwriting, asset management and, more broadly, monetary policy contribute to sustaining high-emission business models. If the first wave concerned public inaction, and the second industrial responsibility, the third concerns the allocation of capital.
This is the reason why the new cases are so legally interesting. They move climate litigation from the smokestack to the balance sheet. They force courts, regulators and boards to confront a simple but uncomfortable proposition: a transition that leaves financial flows untouched is hardly a transition at all.
BNP Paribas, ING, central banking and the EIB
The case of Notre Affaire à Tous, Les Amis de la Terre and Oxfam France v. BNP Paribas, brought in February 2023 before the Judicial Court of Paris, marks a historic threshold: it is widely described as the first climate case brought in France against a commercial bank. The claimant NGOs argue that BNP Paribas violated the French duty of vigilance law, the rules on ecological damage and the climate commitments the bank had publicly undertaken. At the centre of the case lies the alleged absence, within the bank's vigilance plan, of a sufficiently robust commitment to stop financing the expansion of fossil fuels.
The French case is important not only because of BNP Paribas' size, but because the legal architecture is familiar to the future of EU law. The 2017 French duty of vigilance law is one of the models behind the Corporate Sustainability Due Diligence Directive. A judicial finding on the adequacy of a bank's vigilance plan would therefore resonate far beyond France, especially once national systems begin applying equivalent due-diligence duties to corporate climate strategies.
A second and even more explicit test case is Milieudefensie v. ING Group and ING Bank, formally initiated before the Amsterdam District Court on 28 March 2025 after a notice of liability in January 2024. Milieudefensie asks the court to require ING to align its financing activities with a Paris-compatible pathway, including reductions in financed emissions and an end to new financing for companies developing new oil and gas projects. ING filed its Statement of Defence in February 2026 and contests both the legal basis and practical usefulness of the requested orders. The dispute thus brings the Shell logic directly into banking: can a duty of social care be translated into duties concerning financed emissions?
ClientEarth v. Belgian National Bank opened an even more delicate front: monetary policy. Brought in 2021 against the Belgian National Bank in connection with the ECB's Corporate Sector Purchase Programme, the action challenged the acquisition of corporate bonds issued by fossil-fuel or high-emission companies. The claim was withdrawn in 2022 after the ECB announced reforms integrating climate considerations into its monetary-policy operations, but the question it raised remains alive: can central-bank market neutrality be separated from the climate effects of the markets it supports?
The joined cases C-212/21 P and C-223/21 P, EIB and Commission v. ClientEarth, decided by the Court of Justice in 2023, complete the picture from the perspective of public finance. The Court confirmed that environmental NGOs may, in certain circumstances, seek internal review of European Investment Bank financing decisions under the Aarhus framework. The decision is not a general climate-liability judgment. Its importance is more institutional: environmental law enters the heart of supranational financing decisions and requires public lenders to account for the environmental legality of what they fund.
Taken together, these cases do not yet amount to a settled doctrine. They are better understood as pressure points. BNP Paribas tests vigilance and fossil financing; ING tests civil duties of care and financed emissions; the Belgian National Bank case tests the climate accountability of monetary policy; ClientEarth v. EIB tests access to review of public financing. The common denominator is allocation: who receives capital, under which climate assumptions, with which disclosure, and subject to what legal accountability?
Why does the regulatory framework matter?
The litigation trend is developing alongside a dense European regulatory framework. Sustainable finance is no longer made only of broad commitments and reputational pledges. It is increasingly translated into governance, disclosure, due diligence and prudential-risk rules. The CSRD, the EU Taxonomy and the CSDDD provide one part of this framework. But for banks the most important shift may be prudential: climate and transition risks are being recoded as financial risks to be identified, measured, managed, monitored and disclosed.
This is visible in the 2024 Banking Package. CRD VI and CRR III integrate environmental, social and governance (ESG) risks into the prudential architecture of EU banking law. Article 76(2) CRD requires institutions to develop plans addressing the financial risks arising from ESG factors, including the process of adjustment towards EU sustainability objectives. Article 87a CRD strengthens the supervisory framework for identifying, measuring, managing and monitoring those risks across short-, medium- and long-term horizons. The EBA Guidelines on the management of ESG risks then make that language operational by requiring methodologies, materiality assessments, scenario analysis and transition-planning processes.
For future litigation, this regulatory background is crucial. Plaintiffs do not need prudential rules to create a complete private law cause of action by themselves. But those rules may provide vocabulary through which courts assess foreseeability, materiality, governance, disclosure and breach of duty. In other words, prudential climate risk may become evidentially relevant in civil climate litigation: not as a shortcut to liability, but as a benchmark for what a reasonably governed bank could be expected to know and manage.
A legal laboratory for the transition
Climate litigation against banks does not belong exclusively to one branch of law. It sits at the intersection of climate law, banking regulation, corporate governance, tort law, EU public law and monetary policy. Precisely because of this intersectoral position, it puts pressure on legal categories that usually operate separately. Financing decisions are no longer legally invisible simply because they are economically mediated. Nor are climate risks merely externalities once banking supervisors themselves describe them as financial, strategic and governance risks.
This does not mean that the future of banking climate litigation is linear. A parallel backlash is visible, especially in the United States, where asset managers and financial institutions have also faced claims alleging that ESG strategies may conflict with fiduciary duties, consumer-protection rules or antitrust principles. The legal field is therefore not moving in one direction only. It is becoming more contested. Yet that contestation confirms rather than weakens the point: climate-related capital allocation has become a matter of legal responsibility.
In the ancient Greek myth, Cassandra was granted the gift of prophecy but condemned not to be believed. The image is fitting, but the present is different. Today's Cassandras - scientists, lawyers, judges, civil society organisations and affected communities - do not merely announce catastrophe. They produce evidence, invoke legal standards, challenge transition plans, scrutinise financing decisions and build precedents.
Climate litigation against banks is therefore neither marginal nor eccentric. It is one of the arenas in which it will be decided to what extent the ecological transition will reshape the mechanisms that govern the allocation of capital. The decisive question may no longer be only who burns carbon. It may increasingly be who pays for the fire.
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This blog post is based on the paper to be presented at the conference Sustainability Law: Law’s Response to the Convergence of Crises, 16-18 September 2026, at the University of Oslo
