The Clima Act: Companies accountable for climate damage

FIVE days before 2024 ended, The New York Times published a banner story highlighting a new law that penalizes companies for their greenhouse gas (GHG) emissions. It reported that Gov. Kathy Hochul of New York signed the Climate Change Superfund Act into law.

This legislation mandates that companies responsible for carbon dioxide emissions from 2000–2024 should make an annual contribution of $3 billion for the next 25 years. The revenue generated will support climate resilience initiatives and fund projects aimed at mitigating climate change impacts in the state.

In the Philippines, the House of Representatives' Committee on Climate Change held its fourth technical working group (TWG) meeting on the proposed the Climate Accountability (Clima) Act. The goal is to hold companies accountable for their contributions to climate change, especially their GHG emissions.

The bill defines climate accountability as «the responsibility of and corresponding need for reparation from businesses and carbon majors significantly responsible for climate change. A climate accountability regime establishes a governance mechanism for ensuring that climate targets are met through robust regulation and progress reporting. The accountability of carbon majors shall range from negligence to causation.»

While differing in scope and scale, funding mechanisms and legal context, the Clima Act and the Climate Change Superfund Act share notable similarities.

Both embody the fundamental «polluter pays principle» where businesses causing environmental damage are held financially responsible for the aftermath. This approach would incentivize them to reduce their carbon footprint and invest in sustainable practices, contributing to the overall goal of reducing GHG emissions nationally, thereby achieving their Nationally Determined Contribution targets.

Vulnerable communities

Both bills seek to generate financial resources from businesses to support climate-related projects and assist affected communities, illustrating a commitment to corporate accountability in addressing climate change. It emphasizes the need to bolster climate resilience, recognizing that significant investments are