Directors’ Duties Regarding Climate Change in Japan: 2025

Japanese corporate directors can no longer afford to overlook climate-related risks.

A report by the Commonwealth Climate and Law Initiative (CCLI) makes it clear: under Japanese law, directors who fail to identify and manage climate-related risks could be personally liable for breaching their legal duties.

This is no longer just a policy or ESG conversation, it’s a legal obligation and a business-critical issue. Japan faces potential climate-related financial losses of up to JPY 952 trillion by 2050. Key industries are already under pressure from extreme weather events and supply chain disruption.

At the same time, over 85% of institutional investors in Japan now use sustainability data to guide their investment decisions. Boards that ignore climate governance not only risk regulatory scrutiny, they risk losing investor confidence and capital.

Boards that act early will be better placed to reduce financial and reputational risk, maintain market trust, and strengthen long-term business value.

Addressing climate risk is not optional, it is a director’s duty.

Read the CCLI report to understand what this means for Japan’s boardrooms:

Directors’ Duties & Climate Change in Japan: 2025 – CCLI