Santa Marta: The First Step towards Responsibility

23 March 2026

By Robert C. Hinkley

For three decades the United Nations (UN) has held an annual conference (COP) to try to stop global warming, a goal it has failed to achieve.  Greenhouse gases (GHGs) continue to accumulate in the atmosphere.    Each year, weather becomes more unpredictable, storms become more intense, droughts become more severe and the global situation becomes more dire.  The Earth gets closer to the point where global warming triggers self-perpetuating and possibly irreversible changes to the climate system. 

In recognition of the COPs failure and the looming crisis, The First International Conference on the Just Transition Away from Fossil Fuels (the “Conference”) has been called to be held in Santa Marta, Colombia, next month. Its stated purpose is to accelerate the practical delivery of the United Nations’ Framework on Climate Change (UNFCC) “roadmap” towards alleviating the climate crisis.  The following is a suggestion for the first step to be taken on that road.  

Written by a corporate lawyer with 30 years’ experience advising large companies and financial institutions, it’s basic premise is that the climate crisis is a symptom of a much bigger systemic problem caused by a change made to the corporate law starting nearly 150 years ago.  

That change altered how  corporations make their decisions.  It amended the law so that some companies are now encouraged to be irresponsible with the environment and other elements of the public interest.  

The climate crisis makes it clear the change hasn’t withstood the test of time and needs to be reversed.   Substituted in its place, should be decision making criteria more suitable for today’s corporations which have much greater capacity to harm the environment and other elements of the public interest than the corporations of the late 1800s.

Trying to stop climate change one environmental law one country at a time has proven to be unachievable.  The solution offered here will require fossil fuel companies to phase out their GHG emissions and make sure that no company (fossil fuel or otherwise) ever again operates under the impression that it has an inherent right to inflict severe harm on the environment.

Failure of the COPs

The COP process started with the Earth Summit in Rio de Janeiro in 1992.  The COPs attempted to get every nation in the world to agree to reduce the emission of GHGs.  With the nearly unanimous adoption of the Paris Agreement as part of COP21, it looked like it just might work.  Ten years later it is now clear it will not.  

The Agreement contemplated that the delegates to the Paris COP would return to their home nations and sit down with the fossil fuel industry to work out a compromise that would protect the planet from overheating. A very similar strategy to stem another environmental crisis had been successfully implemented  by the UN in 1987.  That strategy led to the Montreal Protocol and the successful phase out of chloroflourocarbons (CFCs) which were creating a hole in the Earth’s ozone layer. 

In both cases, the UN relied on the science and public opinion to get every 

nation in the world to sign an agreement saying each would take steps, 

including passing new legislation, to phase out the cause of the problem. 

Attendees at the Conference in Santa Marta may find it helpful to understand 

why the strategy was successful for the Protocol, but not for the Agreement. 

The reason for the different results can be attributed to the reaction of the  managements of the companies involved:  the chemical industry and the fossil fuel industry.  Chemical industry executives went along with the gradual worldwide phase out of CFCs.  The managements of the fossil fuel companies decided instead to obstruct legislation designed to phase out GHG emissions.  

Passing legislation that will restrict corporate behaviour is relatively easy when the companies being restrained do not oppose it.  The managements of the chemical companies acted as responsible citizens should, when it is discovered their company is doing severe damage to the environment.  They looked for and found a way to make it stop even though it required they sacrifice profits—at least in the short-term.  

In fairness, the Protocol was a relatively minor inconvenience for them.  It affected only a small part of their overall business.  They were beginning to face litigation risk from the effects of CFCs.  They were already developing alternative products which wouldn’t harm the environment. 

In these circumstances, they didn’t object to the Protocol’s implementation. The biggest producers didn’t even ask their governments to provide financial assistance to make the transition.  

Stopping GHG emissions on the other hand, threatened the fossil fuel companies’ survival.  Not surprisingly, the industry vigorously opposed new legislation to make it stop.  

It formed trade associations and employed lobbyists.  Their tactics included spreading misinformation designed to make the transition away from fossil fuels a partisan issue. They funded politicians and political parties who could use their message to keep their base angry by treating with contempt those who advocated a transition to renewable energy.

In the face of this opposition, a compromise couldn’t be found. Some countries gave up.  Others elected new leaders who were uncooperative.   The United States withdrew from the Agreement twice.  Enacting new environmental laws that would force the phase out of emissions proved impossible.  We’re now watching the Agreement slowly disintegrate.

The managements in both industries were required by law to “act in their companies best interests.”  The chemical companies interpreted this directive in a way that caused them to behave responsibly and exit the CFC business.  

GHG emissions, however, are an unavoidable by-product of the fossil fuel business. Phasing out these emissions threatens the value of the industry’s oil, gas and coal reserves and a large part of its operations. Forcing it to significantly reduce emissions is more for them than a minor inconvenience.  It will force the industry to write-off billions it has invested. For many companies, it might result in bankruptcy or liquidation.  

The distinguishing factor between the two industry’s responses is money, the effect stopping would have on the company’s profits and finances. The chemical company directors were willing to take responsibility and alter their business to protect the environment from severe harm.  The fossil fuel company directors were not.

Yet, the directors in both industries were responsible to essentially the same duties imposed under very similar corporate laws. 

Modern Corporate Law

It will surprise many to learn that corporations were not always the free-wheeling, predatory, profit seeking machines they are today.  It wasn’t until the late 19^th century that the corporate law was changed to make them so.  Before that, governments kept companies on a short leash which, if they went beyond and caused severe harm to the public interest, could result in their charter being revoked or not renewed.  

This changed when the individual states in the United States began to amend their corporate laws to make them more attractive to investors.  The idea was to entice investors to organize in their state so it would gain the commerce, jobs and taxes companies would provide.  

This point in history is now referred to by corporate historians as the “Race to the Bottom.”  Each of the states relinquished previous restrictions on corporate behaviour, including unanimously letting go of the need for companies to protect the public from severe harm.  To compete for corporate formations themselves, all jurisdictions throughout the world followed the US example.  From then on, the only duty of corporate directors would be to act in the best interests of their company.  

This was the fork in the road, the defining change that would lead us to where we are today.  It changed the role of corporate directors and, with it, the character of the corporation.  The change told directors to shed their personal feelings, concerns and beliefs at the boardroom door.  Now, their only consideration was to be their company’s best interests. 

This was probably a much bigger change than most realized. It took away the encouragement the prior law provided for companies to be responsible citizens. After the change, the public had to rely solely on the government to step in and pass new laws to protect it.  

When the change first started to take effect, this probably didn’t matter much.  Companies were smaller.  They acted mostly locally.  The technology they used was relatively primitive. They didn’t have the capacity to inflict extensive harm even though, in theory, the change in the corporate law gave them permission.  

Since then, developments in technology and the ability to raise large amounts of capital have exponentially increased big companies’ capacity to cause severe harm.  When that capacity to severely harm is combined with the exposure created by the Race to the Bottom, a dangerous situation exists. If government can’t come to the public’s rescue with new laws to stop severe harm, the company or an industry can continue and the damage accumulate.

Over the last 50 years, corporations have become more successful at obstructing government’s efforts to pass laws to make corporate abuse of the public interest stop.  Various governments’ failure to stop GHG emissions is the quintessential example.

Faced with the prospect of proposed legislation which will make them stop, corporations have two choices:  take responsibility and acquiesce or claim they have no responsibility and obstruct.  Their decision is made under the corporate law which says they must act in their company’s best interests.  

Nothing can be done to change the financial considerations of the companies whose businesses now rely on the burning of fossil fuels.  They’re in too deep.  Instead, the law must be changed to make it clear that all companies discovered inflicting severe harm on the environment must stop and take responsibility regardless of the costs that some (e.g., the fossil fuel companies) will incur.  

This is not as harsh an outcome for the fossil fuel companies as first it may appear.  Their directors have known for a long time that their companies’  day of reckoning would eventually arrive.  Their time to accept responsibility has now come.

A New Strategy

The fossil fuel companies aren’t going to stop on their own as the chemical companies did in response to the Montreal Protocol.  The only way to stop the severe harm they are inflicting is for the separate legislatures of the world to pass laws that will make them stop.  As the UN’s experience under the Agreement has shown, this is a difficult task.

The corporation is the engine of the world economy and protecting the economy has become the sacred cow of politics. Unfortunately, many generations ago mankind tied its future to the corporation and the profit motive.  This must be abandoned.  Changing the way companies make decisions can preserve the profit motive, but must eliminate the infliction of  severe harm as a means of achieving it.  

This is entirely possible.  The two concepts are not mutually exclusive.  

The source of the problem isn’t just the GHG emissions.  The nub of the problem is that there are times when governments can’t enact laws to protect the environment (and other elements of the public interest) from severe harm. 

A government which can’t stop large corporations from inflicting severe harm on the planet and its inhabitants, is a government unable to protect the common good for everyone. It’s unable to fulfill this basic function because institutions it was responsible for creating (i.e., corporations) are standing in its way. This is a systemic problem that’s more serious than even global warming. 

It’s not just a problem for the environment, but for other elements of the public interest—human rights, the public health and safety, the dignity of employees, the protection of children and the wellbeing of our communities—as well.  The potential for severe damage arising in these areas can be seen in the public’s recent concern over the emergence of social media and the development of artificial intelligence. Hundreds of billions are being invested while their unguided and unbounded development continues.  The public has good reason to be concerned.  

Using the experience gained from failing to implement the Paris Agreement, a new strategy must be found which will eliminate any inclination of corporations to severely harm our environment and other elements of the public interest.  Otherwise, rather than living in a world where corporations responsibly serve society as a whole, we will live in one where people are forced to serve corporate self-interest.  

A First Step

The failure of the Paris Agreement cannot be the last word.  Its objective was correct. The strategy employed to achieve it was lacking. 

The first step on the road to halting climate change has to be to find a way to make the fossil fuel companies respond to the climate crisis as the chemical companies did with respect to the developing hole in the ozone layer.  This isn’t as much about adding regulation to prohibit abusive behaviour, as it is changing the instructions directors are given regarding their role and how they make decisions.

A shift in strategy is needed.  Instead of prohibiting what the fossil fuel companies do--emit GHGs, the shift should address the role of directors and how they make their decisions--how corporations think. The Conference is the venue for this shift to be made.

Phasing out fossil fuels will require a return to first principles that (i) reverses the mistake made by the Race to the Bottom and (ii) alters the consequences directors face when they discover that their company is inflicting severe harm.  

To reverse the mistake means putting back into the corporate law duty of directors a duty to protect the environment and other elements of the public interest from severe harm.  For these purposes, let’s just focus on the environment.  It will mean changing the current law from merely acting in the company’s best interests to acting in the company’s best interests without causing severe damage to the environment.

The addition of these seven words to the corporate law all over the world, an abridged form of the Code for Corporate Citizenship (the “Code”), will change dramatically how boards of directors make their decisions.  

• First, it will take away the justification under current law that exonerates directors when they allow their company’s severely destructive behaviour to continue.  

• Secondly, it will cause them to vigilantly monitor their company’s operations for any severe harm that might be emerging so that they may avoid the risk of being forced to shut a business down when such harm is discovered.

• Thirdly, it will give non-board constituencies (e.g., employees, investors, activists, legislative committees and academics) more ability to bring the potential for severe harm arising to the board’s attention before their companies already have too much invested, and

• Finally, it will rid the world of the dangerous incorrect impression that the only thing that matters to people is the economy.  Everyone wants the economy to improve, but there are some things which are even more important and one of these is the environment.  A healthy environment  benefits us all, more or less equally.  Sacrificing it for economic benefits that are distributed unequally is a bad deal.

Under existing law, the risk of severely damaging behaviour falls on the public.  Directors reason their company’s behaviour is legal and they should allow it to continue, even when it harms the public. Changing the law will shift the risk of the continuing harm from the public to the company.

It will put directors on notice that their business will need to be shut (or expensively altered) when the public learns what they now know—the company is already, or is soon to be, severely harming the environment.  The trigger to such risk won’t arise only after new legislation is proposed.  It will arise as soon as the potentially severe harm becomes known. 

Directors (and others, such as investors) will understand that this isn’t a risk worth taking and respond by looking for ways to avoid the damage. Further, competitors and other third parties will realize a market opportunity is opening up, as an old way of doing things is coming to an end and a new way is taking its place.  This should spur investment in new research and development to find solutions.

Severe harm

Amending the corporate law should not be seen as a substitute for business regulation generally.  The spectrum of corporate behaviour that harms the environment  and other elements of the public interest stretches from relatively minor harms to those that can be existential.  Some may question, “What constitutes severe harm? Where does the Code draw the line?”

First of all, severe harm doesn’t occur occasionally.  Business regulation, in the form of environmental laws, will still be needed to curtail behaviour that harms the planet less than severely or that occurs negligently and sporadically.  

Severe harm is extreme, widespread, long-term and cannot be reversed. It is also intentional (including, as the result of wilful blindness). It usually occurs when a harm, initially not recognized, builds up over time and, then when discovered, cannot be stopped.  

The developing hole in the ozone layer and global warming are two perfect examples.  It took advancements in science to discover both, years after the activity causing them first commenced.  By the time the climate crisis became fully apparent, hundreds of billions were invested in companies which were most responsible.

Protecting these investments caused the companies involved to keep using fossil fuels and to obstruct attempts by governments to enact laws which would make them stop.  Whether they recognized it or not, the decision to continue (i.e., not stop the severe harm) was made every time a fossil fuel company, or one of their largest customers, held a board meeting. 

In other words, the source of severe harm isn’t a one-off event.  It’s the corporate decision (or non-decision) which allows the severely harmful behaviour to continue and accumulate even after it has been discovered.  

Overcoming Objections Faced by the Agreement

You might think, based on the failure of the Paris Agreement, it would be impossible to change the law in this manner, but that’s not necessarily so.  The Agreement was a government-led initiative which hoped (in vain) that the fossil fuel industry and its largest customers would accept willingly.  

The Conference should adopt a strategy for implementing the change that will proceed differently.  Government representatives will return home with a plan to enact a specific uniform change and with a majority of the population already on their side.   

The issue won’t be decided in government subcommittee rooms based on how much of their emissions the fossil fuel companies are willing to concede.  It will be decided by the rallying of non-partisan, public support for the proposition that corporations should never be allowed to inflict severe harm on the environment under any circumstances.  

The constituencies who will help build that support have already identified themselves.  In 2024, a poll showed that, across 22 countries surveyed (including 17 of the 18 countries in the G20), 72% of people support making it a criminal offence for leaders of large businesses to permit actions which they know are likely to cause damage to nature and climate that is widespread, long term and cannot be reversed. 

The support of that many voters is not just important for politics. Those people are all customers of big companies as well. Fossil fuel companies, electricity generating companies and motor vehicle manufacturers all want to please their customers and enhance their brands.  This could temper the resistance to the Code of even these industries. 

In addition to being customers, large numbers are investors.  Thirty years ago, socially responsible investing was the product of only a few mutual funds.  The amount of funds under socially responsible management was hardly more than a few billion dollars.  Today, such funds boast that more than $30 trillion is under socially responsible management, showing how investors have become more receptive to the idea that profit and protecting the public interest need not be considered mutually exclusive objectives.

The people who support transition to renewables also include large numbers who are members, donors and staff to non-governmental organizations dedicated to preserving the environment and stopping climate change.  Indeed, there wouldn’t be a Conference if this weren’t true.  

Hopefully, these people will turn their activism in a direction which has a real chance of stopping climate change.  Instead of working separately, their organizations can coordinate to work together.  Initially, they can reach out to candidates for public office in ways that are non-partisan and non-offensive simply by asking candidates, “Do you support taking away the rights corporations now have to severely damage the environment?”  

There are other major organizations that will also support taking away this right.   No major religion or indigenous society teaches that despoiling the home God gave us is acceptable or expected.

One example that immediately comes to mind is the Catholic Church.  Both Pope Leo and his predecessor, Pope Francis, have been strong voices for protecting the environment as a moral issue and advocated for legislation to stop climate change.  

The Santa Marta Conference presents an excellent opportunity for all these groups to assemble and discuss how they are going to work together to bring an end to what is the common source of the corporately inflicted environmental ills they are all confronting.    

Another important point to note is that years ago the industry had economics on its side.   Back then solar, wind and other forms of alternative energy cost more than fossil fuels.  This made it easy for the industry propaganda machine to convince voters they didn’t want renewables. 

Eventually, the relative costs of fossil fuels and renewable energy sources changed.  Advances in technology made alternative energy more efficient and less expensive than fossil fuels.  The rapid development of  less expensive resources should make it much easier for consumers to support the transition now.

The oil, gas and coal companies, their lobbyists and their misguided political enablers haven’t yet stopped spreading lies and misinformation such as: 

• alternative energies rely on minerals which are in short supply and will soon run out, 

• future breakthroughs in nuclear or fusion technology will make transition to solar, wind and battery storage premature and a waste of money,

• batteries cause life threatening fires, and

• alternative energy sources are making electricity prices rise.

These lies have helped stall the transition to renewables, but, as experience in recent Australian elections has shown, voters aren’t falling for them. 

In addition to people supporting the change, the vast majority of businesses will as well.  For these companies, there is no question of them ever causing severe damage to the environment.  Most are small and haven’t the capacity.  Not many are in businesses which harm the environment in any way.

In the last thirty years there’s also been a huge increase in companies looking to take advantage of being known for being “green,” i.e., their social responsibility.  It helps them attract investors and employees as well as sell their products and services.  

Today, there are over 10,000 certified B corporations (https://www.bcorporation.net/en-us/)  globally, spanning more than 160 industries and 100 countries.  These companies are just the tip of a metaphorical iceberg that comprises the corporate social responsibility movement. 

Almost every major company now has an ESG department, standing for the environment protection, social responsibility and good governance.   ESG (https://www.youtube.com/watch?v=D3NkqJ6DEP8)  is taught in every business school alongside management, accounting, finance and marketing.  It attracts students who are becoming the next generation of corporate managers.

Far more companies have reason to support the transition to alternative energy than don’t.  Many of their executives can be expected to become powerful advocates for changing the duty of directors back to requiring the protection of the environment from severe harm.

The strategy underlying the Paris Agreement recognized that climate change was a global problem and would require all the world’s nations to stop it.  Its failure can be attributed to sending the delegates home to take on local companies by themselves.  

It left it up to the returning delegates to figure out how to negotiate local solutions.  The end result was that each nation was trying to solve a global problem on its own with little solidarity or accountability among its counterparts.  

The Santa Marta strategy to implement the seven word change should provide both.   Although minor wording changes may be necessary to fit into the wording of existing corporate law statutes, the essence of the change will be the same the world over because the existing duty of directors is essentially the same everywhere.  This should result in a strong solidarity among nations to get the legislation enacted. 

Further, because it is simple and does not seek the prior agreement  of the local fossil fuel companies, there will be no need for secret meetings with industry lobbyists and legislative staff members to “strike a deal.”  This should help make signatories to the Santa Marta agreement, protocol or treaty more accountable for carrying out their part.

At Santa Marta, the nations of the world must agree to act together as they did in Paris, but this time follow a plan (i.e., roadmap) which is specific and clear.  The Conference must not only agree to bring a large percentage of GHG emissions to a halt, it must be clear on the steps each nation will take to achieve this result.  

One of these steps must be to eliminate the flaw in the corporate law which is now responsible for the continuation of all corporate behaviour that severely harms the environment as discussed above.  Additional changes to the law (e.g., the elimination of fossil fuel subsidies and provisions incentivizing a rapid transfer to renewables) can be included, but changing the duty of directors is crucial.

Going forward, protection of the environment from severe harm must always take precedence over any individual company’s profits and even its continued existence.  The duty of directors must be changed so that they act in their companies best interests without causing severe harm to the environment.  

Conclusion

Today, the freedom of all liberal democracies affords companies the right to engage in behaviour that causes severe harm until a law is passed requiring them to stop.  Since the late 19^th century, directors who’ve discovered their company is inflicting such harm haven’t been required to do anything to stop it. The Race to the Bottom created a loophole which now must be plugged.

Mankind was able to get away with corporations working without boundaries for a long time.  The climate crisis has now made it clear, however, that this system of governing corporations is no longer tenable.  After more than 30 years of talking and climate negotiations, the environment is still being sacrificed simply to allow fossil fuel companies and their largest customers to make money.  Tangible action must be taken before it is too late.

If corporations can obstruct government to keep it from passing laws to make them stop inflicting severe harm, then some element of self-restraint must be re-introduced into the duty of directors.

If the law is left the way it is, it is now clear that millions (and maybe billions) of human beings won’t survive.  To stop global warming, the people of the world are going to have to give up their allegiance to the pursuit of unbounded corporate self-interest.    

When directors discover their company is severely harming the environment, it should be their legal obligation to make it stop. The corporate law duty of directors should be changed to require them to act in the best interests of their company without causing severe damage to the environment.

This simple universal amendment will force a change to corporate decision making everywhere.  Directors will no longer have the excuse that their business isn’t violating any law and making it stop isn’t in their company’s best interests.  

Further, the prospect of having to shut down or alter a business later will make directors more cautious when making decisions to invest or invest more heavily.  It will cause them to more closely monitor their business to make sure regularly that any such threat is not emerging.  

When a new investment is being considered, it won’t simply be a matter of asking the company’s lawyer, “Does the business we’re considering investing in, comply with the environmental laws?”  The directors will have to conduct much broader due diligence to determine,  “Is there a chance the business in which we’re making this investment is, or will be discovered later to be, severely harming the environment?”  

It’s time to recognize that way more harm than good is coming from blindly following powerful institutions dedicated to the pursuit of their own selfish interests.  The cost of the detrimental side effects of that pursuit has become too much to bear. Clear boundaries must now be established before the severe harm it causes does more damage.  

Protection of the environment from severe harm must be made a priority, regardless of any adverse impact it may have on the finances of individual companies.  The place for this is in the duty of directors in the corporate law.

If government can’t pass laws to protect its citizens from corporately inflicted severe harm, then corporate law must be changed to remove the encouragement to cause such harm in the first place. But even more than protecting us from existential harm, boundaries should be imposed that will lead us towards taking better care of each other and the planet we inhabit.   

United, mankind can stand against the fossil fuel industry and its largest customers.  Divided it will fall.  Co-ordinated action that attacks the common source of global warming and the climate crisis is the solution.  

Instead of the people relying on government to negotiate a deal with the industry to stop emissions, voters must take the lead and demand their government enacts legislation that will phase out GHG emissions as soon as safely possible.  

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Robert C. Hinkley is a former US corporate lawyer who is now retired and lives in Berry, NSW Australia.  He’d like to thank Mik Aidt, Paula Downey, Chris Pash and Alan Smith for their review and input of this article.