A 23-year-old student is suing the Australian government alleging that it did not disclose risks associated with climate change on the country's sovereign bonds. This, the litigant alleged, misled the investors.
Kathleen "Katta" O'Donnell filed the case against the government on Wednesday, July 22 in the Federal Court. Her lawyers said that this is the first such case in the world since it deals with climate as a material risk to the sovereign bonds.
The class-action lawsuit seeks to make the Australian government acknowledge its failure at disclosing the climate change-related risks on investment. It also sought an injunction from the court to stop promoting bonds without informing investors about climate change risks.
"Katta owns Australian Government Bonds that mature in 2050, by which time—should the government fail to enact effective policies—the impact of climate change is expected to be severe," Equity Generation Lawyers, the law firm that represents O' Donnell stated on its website.
O'Donnell is reportedly a fifth-year law student at Melbourne's La Trobe University. "Katta grew up in Healesville in the Central Highlands in Victoria. The iconic mountain ash forests nearby, which she grew up exploring, are vulnerable to the impact of climate change, particularly higher temperatures, and reduced rainfall," Equity Generation Lawyers' website stated.
David Barnden, the firm's principal, reportedly, said that climate change is likely to disrupt economies, thus risking bond repayments.
"Australia is on the frontline of sovereign climate risk. We confront the harrowing physical impacts of drought and bushfires, and we also face the financial risks of an economy over-exposed to fossil-fuels being left behind as the world shifts to clean energy," Barnden was quoted as saying by Yahoo Finance.
The lawsuit comes at a time when Australia is grappling with coronavirus. Last summer, the country also witnessed severe wildfires raging across large forested areas of the country. Those wildfires killed 33 people and countless animals.
A spokeswoman for Australia's Treasurer said that the government was aware of the litigation. "Legal representatives are considering the matter. As it concerns current court proceedings, the government will not make any comment," the spokeswoman reportedly said.