Climate Litigation and Greenwashing Disputes: Environmental,Social,and Governance Disclosures,European Union Trends,and a Legal Adaptation Framework for Türkiye

Introduction

Climate change is no longer framed only as an environmental externality. For companies, it now materializes at the intersection of financial risk, corporate governance, and legal responsibility. When physical climate risks are assessed together with transition risks associated with the shift to a low-carbon economy, corporate decisions are evaluated not only by market actors but also by regulators, courts, and administrative authorities (UNEP, 2023). Taken together, these developments indicate that sustainability narratives are increasingly interpreted through an accountability lens.

One of the main drivers of this accountability turn is the institutionalization of environmental, social, and governance (ESG) disclosure practices in both investment analysis and corporate reporting. Yet ESG is not a stable technical category; its meaning shifts across investment analysis, corporate responsibility discourse, and public policy debate, making it a polysemous concept (Pollman, 2024). While this flexibility can expand the narrative space available to companies, it also increases legal uncertainty, because sustainability claims communicated through reports, websites, advertising, investor presentations, or integrated reports may be tested against different legal standards.

Climate litigation has become a particularly visible mechanism through which such claims are scrutinized, especially in the European Union (EU), where sustainability reporting and enforcement agendas are maturing. UNEP (2023) observes that climate disputes increasingly target private-sector actors, including emissions-reduction targets, transition strategies, and public statements, not only governmental acts and omissions. Setzer and Higham (2024) similarly show that strategic lawsuits against companies and trade associations intensified after 2020 and expanded beyond the fossil fuel sector. Importantly, many of these cases contest forward-looking decision processes and risk management structures rather than focusing solely on remedying past harm.

This litigation trajectory elevates ESG disclosures from communications to evidentiary infrastructure. Sustainability reports, transition plans, emissions disclosures, and net-zero targets can become part of the corporate record and can structure the parties’ claim and defense narratives, particularly when inconsistencies emerge between stated commitments and operational performance (Setzer and Higham, 2024). As a result, companies face growing pressure to treat sustainability statements as verifiable assertions supported by traceable data and documented decision-making processes.

This article argues that the evidentiary quality of ESG disclosures is increasingly central to corporate climate litigation risk and that reporting standardization and enforcement dynamics are tightening the link between disclosure practice and liability exposure. Using a comparative law approach, it examines Milieudefensie et al. v. Shell and ClientEarth v. Shell to show how courts calibrate judicial intervention through duty-of-care reasoning and directors’ duties (Rechtbank Den Haag, 2021; Gerechtshof Den Haag, 2024; High Court of Justice, 2023). It then discusses how these trends intersect with Türkiye’s emerging reporting framework, particularly the Türkiye Sustainability Reporting Standards (TSRS), and with existing private-law tools that can be mobilized against misleading environmental claims (Çetiner, 2025; Republic of Türkiye Ministry of Trade, 2024; Solak, 2025). The article proceeds as follows: It first outlines the conceptual framework and typology of corporate climate litigation; it then analyzes the construction of corporate liability through duty of care and directors’ duties; it subsequently explains how ESG disclosures function as evidence in greenwashing and climate-washing disputes; and finally, it proposes an adaptation-oriented compliance design for Türkiye.

Conceptual Framework of Climate Litigation and Typology of Claims Against Companies

Climate litigation, in a broad sense, refers to disputes involving legal issues related to climate change mitigation, adaptation, or the substantive elements of climate science (UNEP, 2023). Such disputes are sometimes constructed around a direct demand for emissions reductions; at other times, they are framed through obligations to disclose climate risk, the realism of climate plans, or the requirement to adopt decisions aligned with climate targets. Peel and Osofsky (2020) show that climate cases rely on different legal instruments across jurisdictions and that public law, private law, and human-rights-based arguments together form a mutually reinforcing ecosystem. This diversity appears consistent with the nature of climate risk, which cannot be confined to a single branch of law.

Global reports indicate that climate litigation has not only increased in number but has also acquired a strategic character. Setzer and Higham (2024) note that strategic cases filed against companies and trade associations have reached approximately 230 since 2015, with a substantial share brought after 2020. The aim in such cases is not merely to establish the unlawfulness of past conduct; it is to contest the company’s decision architecture and the governance choices that will shape future climate performance. From this perspective, climate litigation puts the adequacy of emissions-reduction targets, the credibility of transition plans, and companies’ value-chain management on the agenda. Such cases typically target corporate policy and governance arrangements rather than isolated acts; reports, investor presentations, and target disclosures serve as the central evidentiary materials of the claim (UNEP, 2023).

The sectoral distribution of corporate climate litigation is also changing. Setzer and Higham (2024) report that strategic cases are increasingly concentrated not only on fossil fuel companies but also across sectors, such as aviation, automotive, retail, food, e-commerce, and financial services. This diversification indicates that climate risk is not a litigation risk unique to “high-emitting” sectors. Emissions-reduction targets, product-related claims, and supply-chain impacts become visible in different ways across business models yet remain subject to legal scrutiny.

A major strand of corporate climate litigation is constructed through transnational tort claims. Such cases establish a justice pathway in which allegations of harm and the attribution of responsibility are linked to cross-border emissions chains. Bouwer (2021) argues that transnational tort litigation enables claims concerning harms caused by major emitters to be advanced across different jurisdictions and, in this respect, expands the spatial boundaries of climate justice. Setzer and Benjamin’s (2020) assessment focusing on the Global South similarly shows that these cases generate innovative tools yet develop at different speeds across jurisdictions due to constraints of resources, access, and institutional capacity.

Another category within climate litigation concerns counter-strategies developed by companies against climate policies, as well as disputes targeting climate regulation itself. The Network for Greening the Financial System (NGFS, 2021) notes that, in some cases, companies or investors pursue compensation claims through instruments such as international investment agreements or the Energy Charter Treaty, arguing that new environmental regulations have caused unexpected losses. Such disputes demonstrate that the legal costs of the climate transition can generate pressure not only on regulated actors but also on regulatory authorities. Taken together, these dynamics suggest that corporate climate litigation is not a one-directional process against companies; it is a multidimensional arena in which climate policy is negotiated through adjudication.

One of the fastest-growing subfields within the typology is climate-washing and greenwashing disputes. Setzer and Higham (2024) note that climate-washing cases target claims about the climate impact of companies’ products and services, carbon neutrality statements, or net-zero strategies. These cases exceed the classical boundaries of environmental law and trigger liability debates across areas, such as consumer law, unfair competition, capital markets law, and contract law. In Türkiye, the doctrinal tendency to frame the greenwashing debate primarily through unfair competition provisions and regulations on commercial advertising runs in parallel with this global trend (Çetiner, 2025; Solak, 2025).

Setzer and Higham (2024) report that climate-washing cases accelerated in 2023, with 47 new filings, and that the total number has exceeded 140. The same report states that more than half of nearly 140 cases have been resolved by courts or similar decision-making bodies; among 77 resolved cases, 54 (approximately 70%) resulted in outcomes favorable to claimants (Setzer and Higham, 2024). This finding indicates that climate-washing disputes do not remain at the level of “allegations” and that they generate concrete sanctioning and corrective capacity across many jurisdictions. As a result, climate-related terms used in corporate marketing and reporting narratives are increasingly treated as capable of being tested before courts.

The diversification of claimant profiles is decisive in the expansion of the typology. Civil society organizations and citizen initiatives challenge the adequacy of emissions-reduction targets and the alignment of corporate climate strategy with the Paris goals. In addition, investors and shareholders may pursue litigation or complaint channels based on claims that the financial effects of climate risk are insufficiently disclosed or that the board’s risk management standard is inadequate. Consumers and competing undertakings, in turn, may advance claims of deceptive advertising, unfair competition, or misinformation based on the accuracy of environmental statements (Setzer and Higham, 2024). This multistakeholder landscape shows that climate risk has evolved into a dispute domain that cannot be reduced to a single interest group. Forum selection and jurisdictional debates have also become part of litigation strategy, as claims concerning the same facts may be assessed under different standards across legal systems, generating multijurisdiction risk for transnational corporate groups (Bouwer, 2021).

Establishing Corporate Liability: Duty of Care, Directors’ Duties, and Judicial Limits

In climate litigation directed against companies, the critical issue is the extent to which the concept of a duty/standard of care encompasses climate risk and emissions reduction. In most legal systems, the duty of care is one of the core concepts of tort law and is concretized through criteria, such as foreseeability of harm, preventability, and a standard of reasonable conduct. Climate change, however, is a multiactor, long-term phenomenon that strains these criteria. Applying them in this context expands both courts’ capacity for scientific assessment and their normative margin of appreciation (Peel and Osofsky, 2020). In the Turkish literature, assessments of systemic climate litigation emphasize the transformative effects of debates over judicial powers and state obligations (Açımuz, 2022). A similar transformation is also observable in corporate liability, where the limits and enforceability of judicial orders are increasingly contested.

The Milieudefensie et al. v. Royal Dutch Shell case in the Netherlands stands out as one of the most visible examples of this debate. In its judgment of May 26, 2021, the District Court of The Hague held that Shell must reduce its group-level CO₂ emissions by a net 45 percent by 2030 compared to the 2019 level (Rechtbank Den Haag, 2021). The court accepted that the company is subject to a duty-of-care standard requiring it to contribute to climate change mitigation, and that this standard translates, with respect to Shell’s corporate policies and strategies, into a concrete emissions-reduction obligation. The judgment takes into account not only emissions arising from the company’s own activities but also Scope 3 emissions originating from the supply chain and product use; in this respect, it indicates that companies must manage climate risk not merely at the operational level but through a value-chain perspective (Rechtbank Den Haag, 2021).

The Hague Court of Appeal’s decision of November 12, 2024, however, set aside the reduction order imposed at first instance and dismissed the claim (Gerechtshof Den Haag, 2024). The appellate decision accepts that the need to combat climate change and companies’ responsibilities in this field are not in dispute, yet points to the limits of imposing a specific percentage target through a judicial order (Gerechtshof Den Haag, 2024). This pair of decisions shows that, while corporate responsibility in climate litigation is expanding, courts are also attempting to calibrate the degree of intervention. For companies, the risk is not only the “disposition” but also the standard constructed in the judicial reasoning, because that standard creates a new expected behavioral threshold in reporting, internal control, and supply-chain management.

The Shell decisions also make the debate over control and sphere of influence visible. The court’s approach shows that a company cannot be confined to a responsibility framework limited to emissions from its own facilities; rather, governance capacity exercised through group policies, investment decisions, and supply relationships is also brought within the assessment (Rechtbank Den Haag, 2021). Scope 1 and Scope 2 emissions are linked to the company’s direct activities and purchased energy consumption, whereas Scope 3 emissions cover indirect emissions arising from the supply chain and product use. This distinction suggests that liability in climate litigation is shifting from a narrow “direct harm” understanding toward a “value-chain management” understanding. While the appellate decision’s setting aside of the reduction order shows that this expansion does not automatically translate into a quantifiable percentage target, it also confirms that value-chain-scale responsibility debates have become enduring (Gerechtshof Den Haag, 2024).

Establishing liability in climate litigation also necessitates debates on causation and attribution. Under a classical tort approach, a direct link is expected to be established between harm and conduct; climate change, as a phenomenon arising from the long-term contributions of numerous actors, challenges this expectation. NGFS (2021) shows that, in climate-related cases, harm can sometimes be linked to a direct act, while in other cases, impacts are constructed more indirectly and that, in such indirect constructions, climate science and attribution studies gain prominence. Consequently, when courts assess the argument that a company’s emissions contributed to an increase in a particular risk, they interpret the criteria of foreseeability and preventability together with the evolving evidentiary capacity of climate science (Bouwer, 2021; NGFS, 2021). This development requires that defenses in climate litigation be supported not only by legal arguments but also by data integrity and scientific grounding.

Another dimension emerging alongside climate litigation is the integration of climate-related litigation risk into debates on financial stability and supervision. NGFS (2021) notes that climate litigation constitutes a risk category capable of reinforcing physical and transition risks and that litigation risk is becoming important for microprudential supervision and financial stability monitoring. This assessment indicates that companies should address climate litigation not merely as an issue for the legal department but at the corporate level in terms of access to finance and risk management. Therefore, the coherence of climate strategy, the verifiability of disclosures, and the traceability of supply-chain processes become increasingly important for lenders and investors.

Cases framed through board duties bring into focus how climate risk is embedded within internal corporate decision-making processes. The ClientEarth v. Shell Plc case in the United Kingdom stands out as an example of a derivative action targeting the board’s choices regarding climate strategy. In its decision of July 24, 2023, the High Court refused permission, holding that the claimant had not sufficiently demonstrated breaches of duty by the directors (High Court of Justice, 2023). The decision draws a boundary regarding how climate strategy disputes are positioned within the domain of managerial discretion, showing that the court adopted a line that avoids direct intervention in the board’s strategic choices. Nevertheless, the effect of such cases is not limited to their litigation outcome: Pleadings and judicial assessments increase boards’ disciplines of documentation and justification regarding climate risk.

The extension of board responsibility to climate risk becomes more visible through trends in corporate climate litigation focusing on personal liability. Aristova and Nichols (2024) note that, within the broader increase of climate litigation, directors’ duties and responsibilities are more frequently placed on the agenda and that this debate compels companies to treat climate risk as a management function linked to strategy, risk management, and disclosure duties. This trend shows that climate risk is addressed not only as an environmental issue but also as a governance standard connected to the legal auditability of decision-making processes. In Turkish company law discussions, it is also emphasized that directors’ discretion in sustainability and ESG-related decisions is not unlimited and that standards of the duties of care and loyalty should be considered together with multistakeholder sustainability objectives (Açımuz, 2022). At this point, boards’ prioritization of climate risk, oversight of data-production processes, and documentation of decision rationales have structural importance for reducing litigation risk.

Board-level management of climate risk is not confined to setting targets; it also turns on how targets are set and the information base used to justify them. Aristova and Nichols (2024) argue that the climate dimension of directors’ duties is increasingly debated through the lens of process quality. On this reading, scrutiny extends beyond the substance of directors’ choices to the assessments, documentation, and internal controls through which those choices are reached. In practical terms, recording climate-related risk scenarios, linking targets to interim milestones, and documenting strategic rationales in board minutes and committee reports strengthen a company’s defensive posture. The High Court’s emphasis in ClientEarth v. Shell on managerial discretion when assessing the sufficiency of the claim highlights the value of decision rationales and process evidence for corporate defenses (High Court of Justice, 2023).

Evidentiary Function of ESG Disclosures in Greenwashing and Climate-Washing Disputes

One of the main factors amplifying the impact of climate litigation on companies is the increasing standardization and documentation of sustainability information. ESG reports, transition plans, emissions statements, and net-zero targets, together with investor communications, can structure the claim and defense narrative in litigation. Berg et al. (2022) demonstrate that there is significant divergence among ESG ratings and that markets do not operate with a single, stable measurement language for ESG performance. This fragmentation makes the verifiability and methodological consistency of corporate statements more critical. For this reason, producing sustainability disclosures under corporate governance and supporting them with internal controls and audit processes can form an evidentiary chain that reduces litigation risk.

The evidentiary value of ESG information is linked not only to the content of the document but also to the process through which it is produced. Sustainability reports are often prepared under board oversight, pass through the controls of internal audit and compliance functions, and, in some jurisdictions, may be subject to independent assurance. This increases the reliability and comparability of reports, while also creating a corporate record that leaves companies with a narrower room for maneuver against their own statements. In particular, where methodology, scope boundaries, base-year selection, and uncertainties are not clearly disclosed, the likelihood strengthens that the report may operate as an evidentiary source against the company.

The evidentiary value of ESG statements is also connected to choices in disclosure language. Pollman (2024) shows that the ESG term is used by different actors for different purposes and, therefore, sits on a contested semantic foundation. This contested foundation renders more critical the question of under which criteria companies use expressions such as “sustainable,” “green,” “climate-friendly,” or “net zero.” Constructing broad promises with ambiguous concepts may appear to generate short-term communications advantages; however, over the longer term, it increases the burden of substantiating the claim set and enlarges dispute risk.

Climate-washing and greenwashing disputes transform the “market promise” character of ESG information into a direct source of liability. Ballan and Czarnezki (2024) argue that the ESG disclosure movement has expanded through both voluntary and mandatory reporting channels. This expansion has, in turn, increased investor and consumer disputes via greenwashing and misrepresentation allegations. In their framing, greenwashing is treated as presenting the environmental or sustainability qualities of a product, service, or corporate practice as more positive than they are in fact. A defining feature of such allegations is that, in many instances, they push classical harm-and-causation debates into the background and bring to the fore the accuracy of information, the completeness of disclosures, and a standard of honesty/fair presentation.

Setzer and Higham (2024) report that climate-washing cases accelerated in 2023, with 47 new filings, and that the total number has exceeded 140. They further note that climate-washing allegations increasingly concentrate on the boundaries of net-zero targets, the transparency of carbon offsetting strategies, and the measurability of climate-related claims (Setzer and Higham, 2024). In these cases, disputes typically focus on statements that understate a company’s climate impact, fail to ground emissions-reduction claims in a verifiable methodology, or conceal uncertainties. Judicial practice shows that climate-washing allegations intersect with multiple fields of law. Setzer and Higham (2024) indicate that climate-washing cases have begun to target not only fossil fuel companies but a broader set of corporate actors, including consumer products, financial products, and service providers.

In climate-washing disputes, evidentiary debate often begins with the substantive accuracy of the statement and extends to its completeness and how it is perceived by consumers or investors. Even where a statement appears technically accurate, information taken out of context or presented incompletely can support a “misleading presentation” allegation. For this reason, the verifiability of a carbon-neutrality statement depends on several critical factors: the emissions scopes covered, the nature of offsetting mechanisms, the calculation’s time horizon, and the presence of interim milestones. Setzer and Higham (2024) report that a significant portion of resolved climate-washing files resulted in outcomes favorable to claimants. This indicates that disclosure quality and methodological transparency can directly shape dispute outcomes.

A portion of greenwashing disputes can be constructed on the consumer side through allegations of “deceptive practice,” while another portion can be constructed on the investor side through allegations of “inaccurate or incomplete disclosure.” Ballan and Czarnezki (2024) assess that, to the extent ESG disclosures become a meaningful information set for investors, inconsistencies in those disclosures can also feed liability debates under securities law. In this respect, where disclosures concerning the financial effects of a sustainability report or a climate commitment can be characterized as material information affecting investment decisions, a “misleading presentation” allegation may arise not only under consumer law but also within capital markets law.

At the European level, regulators’ assessments of greenwashing risk provide a background that strengthens the auditability of corporate statements. The European Central Bank (2025) reports that the European Supervisory Authorities define greenwashing as presenting a sustainability profile as more positive than it actually is and failing to reflect that profile in a clear and fair manner. The same study emphasizes that the capacity of corporate disclosure rules to reduce greenwashing risk depends not only on the existence of standards but also on implementation and enforcement strength (European Central Bank, 2025). This indicates that climate-washing disputes should be addressed not merely as an ethical problem but also as a question of regulatory design and enforceability.

In climate-washing disputes, sanctions and remediation design can extend beyond damages. Setzer and Higham (2024) note that some climate-washing files are resolved in courts, while others are decided in different fora, such as advertising oversight mechanisms or regulatory decision-making bodies. These different fora make it possible for outcomes such as corrective disclosures, cessation of advertising, withdrawal of labels, or mandated public disclosure of specific information to arise. Consequently, when companies formulate climate claims as one-off “campaign language,” they may adopt a risk posture that fails to anticipate how the statement will be read in subsequent oversight and in which fora it may be contested. A more institutionally sustainable approach is to establish a claims-governance framework that defines, from the outset, the language, scope, and measurement method of the claim and records changes in a traceable manner.

The evidentiary character of ESG disclosures also raises the possibility that a company’s “self-assumed” standard may operate against it in court. Where a company sets out, in reports, policy documents, or advertising, a specific climate target, sustainability standard, or value-chain commitment, subsequent inconsistencies in implementation can simplify the claimant’s evidentiary architecture. In this sense, ESG statements can create a self-commitment foundation that elevates the company’s applicable standard of care. Explaining not only what the company will do but also how it will measure and monitor that undertaking becomes a central component of legal defense in climate litigation.

Legal Implications for Türkiye and the Design of Corporate Compliance

In Türkiye, the climate litigation literature has long been discussed primarily through the lens of state obligations and the judiciary’s review capacity. Açımuz (2022) shows that systemic climate cases developing in Europe after the Paris Agreement have transformed the state’s sphere of action and that, in potential cases in Türkiye, debates over judicial orders are likely to gain prominence. For companies, by contrast, the main risk lines concentrate along the accuracy of investor communications and capital markets disclosures, the review of environmental claims directed at consumers and the market under unfair competition and advertising law, and the intersection between the board’s duty to oversee climate risk and the applicable standard of care. These axes indicate that climate litigation in Türkiye may also trigger multichannel liability debates.

The standardization of sustainability reporting in Türkiye significantly increases the production of corporate records relating to climate risk. The Ministry of Trade announced that the TSRS were adopted in full alignment with the International Sustainability Standards Board’s S1 and S2 standards and published in the Official Gazette dated December 29, 2023 (MoT, 2024). The same announcement states that, as of January 1, 2024, sustainability reporting became mandatory for undertakings that exceed specified size thresholds in two consecutive reporting periods (MoT, 2024). This development shows that climate risk has moved beyond the domain of voluntary reporting and that companies are now required to disclose climate impacts and transition plans through a more systematic dataset.

One of the most concrete consequences of standardization is the increased capacity of the reporting process to generate evidence. Mandatory reporting turns companies’ climate-risk statements into a “corporate record”; this record produces a set of documents that can be used directly in administrative supervision and private law disputes. Therefore, clearly setting out the methodology used in the report, the base year, scope definitions, and uncertainties matter not only for reporting quality but also for litigation risk. As the evidentiary character of ESG disclosures strengthens, inaccurate or incomplete statements are expected to produce heavier consequences for companies.

The legal foundation of the greenwashing debate in Türkiye is predominantly constructed in doctrine through unfair competition and commercial advertising regulations. Çetiner (2025) shows that, in EU and Turkish law, tools aimed at preventing greenwashing operate primarily through unfair competition provisions and rules on commercial advertising and unfair commercial practices. Solak (2025), assessing EU regulations together with consumer protection and advertising law in Turkish law, argues that the standards of verifiability and clarity for environmental claims should be strengthened. These studies indicate that environmental statements have become, not only in investor relations but across product promotion and the full field of corporate communications, a set of claims open to legal scrutiny.

A practical risk point in Türkiye in terms of greenwashing oversight appears to be the disconnect between sustainability reporting and marketing language. Solak (2025) emphasizes that environmental claims are subject to standards of accuracy and clarity within consumer and advertising law; Çetiner (2025) shows the complementary role of unfair competition tools in this oversight. For that reason, the terminology used in sustainability reporting needs to be grounded in the same data infrastructure as the terminology used in product/service communications. Where the reporting team and the marketing team operate in separate silos, a claim that is framed as technically limited and conditional in one channel may be presented as an “absolute” promise in another. Managing this risk requires establishing, at the corporate level, a single verification gate and a cross-functional claims committee.

From the perspective of corporate compliance design, the priority is to restructure the production pipeline of ESG information through the lens of legal risk. First, it is necessary to create a claims inventory that records the data sources, scope definitions, and methodologies underlying environmental and climate-related claims. Second, claims such as net-zero and carbon neutrality should be supported by interim targets, a clear Scope 1, Scope 2, and Scope 3 emissions boundary, and a monitoring mechanism. Third, climate risk should be placed as a regular agenda item at the board level, and strategic decisions should be documented with reasoned justifications. Fourth, consistency checks should be performed between sustainability reporting and financial reporting, traceability of the underlying data should be ensured, and external verification processes should be planned where feasible.

Corporate compliance design entails not only producing documents but also managing them. Because the claim set in climate litigation is often built on reports spanning multiple years and statements published across different channels, weak document retention and version-control discipline can undermine the defense. As a result, the source of sustainability data, the calculation method, and the update cycle should be governed through an internal-control logic as strict as that applied to financial data. Periodic reviews of whether statements approved at the board and senior management levels remain consistent with the company’s actual practices provide a protective layer against climate-washing allegations (Setzer and Higham, 2024).

This design not only reduces litigation risk, but it also generates trust in access to finance and supply-chain relationships. The increase in climate-washing cases highlighted in Setzer and Higham’s (2024) report makes it necessary for companies to manage sustainability claims not as a marketing device but as a verifiable performance claim. Therefore, at the center of legal risk, management lies in making the consistency between what is “said” and what is “done” documentable. For companies, the success of a compliance program is directly linked to data-governance capacity that can guarantee the accuracy of claims and to the integrity of the evidentiary set that will carry the defense when a dispute arises.

The design of the mandatory reporting threshold under the TSRS indicates which clusters of companies will generate corporate records of climate information. According to the Ministry of Trade’s announcement, the reporting obligation arises where at least two of the specified criteria exceed the threshold values in two consecutive reporting periods (MoT, 2024). These thresholds are stated as 250 employees, TRY 500 million in total assets, and TRY 1 billion in annual net sales revenue (MoT, 2024). The announcement further states that banks subject to regulation and supervision under banking legislation fall within the mandatory scope without any threshold requirement (MoT, 2024). This framework increases, particularly for financial institutions and large corporate groups in Türkiye, the likelihood that ESG information will be carried into audit and dispute processes.

Conclusion

Climate litigation and the evolving ESG reporting architecture are transforming corporate responsibility into a dual-channel regime. On the one hand, the proliferation of sustainability statements and the institutionalization of reporting standards increase companies’ capacity to measure and disclose climate impacts. On the other hand, climate litigation creates an accountability space in which these disclosures and strategies are subjected to judicial and administrative scrutiny (UNEP, 2023; Setzer and Higham, 2024). The Shell line of decisions and ClientEarth v. Shell demonstrate that courts are prepared to render corporate climate strategy legally contestable through duty-of-care reasoning and directors’ duties, while simultaneously calibrating the limits of judicial intervention. What these cases establish, beyond their immediate outcomes, is a behavioral standard: Companies are expected to govern climate risk with the same rigor they apply to financial risk (Rechtbank Den Haag, 2021; Gerechtshof Den Haag, 2024; High Court of Justice, 2023).

The rapid growth of climate-washing disputes further elevates the evidentiary character of ESG statements. Setzer and Higham (2024) note that climate-washing cases exceed 140 in total and that a substantial share of resolved cases have resulted in outcomes favorable to claimants. Taken together, these findings suggest that widespread sustainability claims, when made without documentation and methodological transparency, carry a high capacity to generate legal risk. The European Central Bank’s (2025) analysis reinforces this point: having standards in place is insufficient; what determines exposure is whether those standards are implemented with rigor and enforced with consistency.

In Türkiye, the entry into force of the TSRS, which made sustainability reporting mandatory for in-scope undertakings, strengthens the production of corporate records relating to climate risk. At the same time, unfair competition and advertising law tools open environmental claims to legal scrutiny (Çetiner, 2025; Solak, 2025; MoT, 2024). In this landscape, the most critical investment for companies is establishing a governance infrastructure that treats ESG information not as a communications narrative but as a legally relevant record. Where a claims inventory, data governance, board oversight, and consistency controls are not designed together, sustainability discourse can rapidly evolve into liability discourse. Ultimately, ESG disclosures function as evidentiary infrastructure: They structure the claim and defense narratives that courts and regulators rely upon when corporate sustainability commitments are contested. The quality, consistency, and methodological grounding of that infrastructure is therefore not merely a reporting concern—it is a determinant of litigation risk. As climate litigation continues to redefine the boundaries of corporate responsibility, the decisive question for companies is no longer whether their sustainability commitments will face legal scrutiny, but whether their evidentiary architecture is prepared to withstand it.

Author’s Contributions

This work was carried out by a single author. The author was responsible for conceptualization, methodology, investigation, formal analysis, writing: original draft, and writing: review and editing.

Ethical Considerations

Ethical approval was not required for this study because it did not involve human participants, human data, or human tissue.

Data Availability

Data sharing is not applicable to this article as no datasets were generated or analyzed.