Sunday Read: Climate Whistleblower Campaigns
From marine pollution to the illegal timber trade and unethical actions in the oil and gas sector, climate risks are unfortunately endless.
According to a new report from the International Labour Organization, nearly 70% of the global workforce is exposed to health hazards caused by climate change. However, brave residents, employees, and government agents have come forward to expose wrongdoing in the hopes of stopping bad actors. As a result, environmental crimes are regularly on the radar of the National Whistleblower Center (NWC).
In this Sunday Read, and in the spirit of Earth Month, NWC demonstrates its ongoing commitment to environmental whistleblowers and the laws that protect them with evergreen resources, impactful campaigns, and recent announcements.
A Natural ‘Alliance’
Co-chaired by Norway and the United States, the Nature Crime Alliance officially launched in August 2023. Created in recognition that current efforts to tackle nature crime are often carried out in isolation, one of its goals is to encourage more collaboration among the public and private sectors.
The Alliance recognizes examples of nature crime as: “…illegal forms of logging, mining, wildlife trade, land conversion, and crimes associated with fishing.” In turn, these crimes drive environmental degradation and biodiversity loss; devastate local communities; fuel financial crime and corruption; and challenge the rule of law.
NWC shares these beliefs and the Alliance’s objective of halting criminal activities that exploit natural resources, and its membership in the Alliance is mutually beneficial.
In March 2024, NWC announced its membership in the Nature Crime Alliance, a global network of governments, law enforcement bodies, local communities, companies, and civil society organizations working together to fight nature crime.
“Combatting nature crime is impossible without whistleblowers, but strategies to combat nature crimes fail to fully deploy proven best-practice whistleblower programs,” said NWC Executive Director Siri Nelson.
NWC intends to work with the Alliance members on how to best leverage whistleblowers in the fight against nature crime, including through the use of whistleblower awards and anonymous reporting channels.
“By working with NWC,” said Yulia Stange, Director of the Nature Crime Alliance, “We hope we can build the support systems needed to encourage and protect whistleblowers which, in turn, will lead to more prosecutions of the perpetrators of these crimes.”
High Risk Industries — Environmental
Though Earth Month takes place annually in April, protecting the planet should be a year-round endeavor. It’s a time to raise environmental awareness and create consciousness around the issues that affect mother nature during this time of crisis. NWC has identified several industries impacting environmental and climate crimes that are at a high risk of fraud.
Oil & Gas
The oil and gas industry is grappling with major financial challenges on several fronts, including drastic decreases in demand. These and other difficulties have put the industry at an even higher risk of fraud.
Coal
Growing concern about coal’s climate impacts and competition from renewable energy have put pressure on the industry to prove that it can remain a major player long-term. When companies face financial strain, the potential for fraudulent behavior is particularly acute.
Timber
The long-term global demand for timber products continues to increase. As much as 23% to 30% of hardwood lumber and plywood traded globally could be from illegal logging activities. As the illegal timber trade grows, so does illegal logging, a major driver of the deforestation devastating forest-dependent communities and worsening climate change. Other opportunities for fraud in connection with timber harvesting as well as in the wood products supply chain.
Who are the “Professional Enablers”?
Despite the imperative to prepare for a low-carbon economy, fossil fuel and timber companies have continued to incentivize growth and spend billions. Professionals who work with the fossil fuel and timber industries may enable tax and white-collar crimes. Some of the key sectors affected include:
Securities. These companies have been able to operate and expand in part by issuing securities, which allow them to raise capital.
Banks provide loans as well as underwriting services that allow companies to issue new stocks and obtain debt financing through corporate bonds.
Investors depend on the Big Four accounting and auditing services firms to provide independent evaluations and examinations of financial statements. However, evidence suggests that these services might not be as reliable as the firms claim.
The fight for justice and for change to protect the environment is not easy. While there is widespread condemnation of polluters and lawbreakers, they must be held accountable to prevent recurrences. One of the most effective methods to ensure this accountability is for those with intricate knowledge to come forward — and to reward them for their truth and bravery. This is the essence of whistleblower law.
SEC Climate Disclosure Rules and the NWC Climate Corruption Campaign
Climate change poses an enormous threat to our economy and quality of life, and readily available solutions are not being implemented fast enough to head off the worst damage.
In March 2024, the Securities and Exchange Commission (SEC) adopted rules to enhance and standardize climate-related disclosures by public companies and in public offerings. The final rules reflect the Commission’s efforts to respond to investors’ demand for more consistent, comparable, and reliable information about the financial effects of climate-related risks on a registrant’s operations and how it manages those risks while balancing concerns about mitigating the associated costs of the rules.
The SEC’s rules reflect, by some measure, the details of the NWC’s Climate Corruption Campaign launched in January 2020. The Campaign focuses on the fossil fuel and timber industries as well as their professional enablers, including the securities and banking industries.
The campaign’s securities work is focused on one central concept: major corporations and large financial institutions are significantly exposed to climate risks, and these institutions are not moving toward net-zero financing at the pace or scale necessary to avoid destabilizing the climate or the economy.
Resources for Whistleblowers
NWC provides perspectives on environmental whistleblower laws that can have international impact. These laws include:
- The Act to Prevent Pollution from Ships (APPS). One of the most important and effective tools to uncover and prevent marine pollution APPS is a U.S. law that includes a key provision permitting federal courts to grant rewards of up to 50% of the total fines to whistleblowers whose disclosures regarding pollution on the high seas result in a successful prosecution.
- Oil & Gas. While there is not a whistleblower law specific to the oil and gas industry, there is a large framework of U.S. laws that can be used to address fraud in the oil and gas industry. This includes the federal False Claims Act, the Dodd-Frank Act and the Foreign Corrupt Practices Act allows whistleblowers to report bribery or corruption.
- Many environmental laws also have special provisions related to corporate whistleblowers. These include the Clean Air, Toxic Substances, Clean Water, Solid Waste, Safe Drinking Water, and Superfund Acts.
As Whistleblower Network News recently noted, whistleblower provisions in other environmental laws, like the Lacey Act and the Endangered Species Act, must be improved.
For their potential to be fully realized, these laws need to be enforced more effectively, encouraging more people to come forward. Though environmental laws can offer protection and monetary rewards, the decision to come forward is not one to be taken lightly, nor should selecting a whistleblower lawyer. NWC provides resources that can connect you with the right legal professional.
Support NWC
The NWC is a 501(c)(3) non-profit and our awareness-building work is made possible with the support of our generous donors. Please consider donating $100 today to help us continue our important advocacy for whistleblowing and whistleblowers around the world. Donors of $100 or more will receive a copy of Rules for Whistleblowers: A Handbook for Doing What’s Right, written by NWC Chairman Stephen M. Kohn, Esq.
This story was written by Justin Smulison, a professional writer, podcaster, and event host based in New York.
