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Student files lawsuit over government bonds

  • July 24 2020
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Invest

Student files lawsuit over government bonds

By Cameron Micallef
July 24 2020

A 23-year-old student has filed a lawsuit against the Australian government after alleging that it failed to disclose climate change-related risks to investors in the country’s sovereign bonds.

Student files lawsuit over government bonds

Student files lawsuit over government bonds

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  • July 24 2020
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A 23-year-old student has filed a lawsuit against the Australian government after alleging that it failed to disclose climate change-related risks to investors in the country’s sovereign bonds.

Student files lawsuit over government bonds

According to the litigation filed on Wednesday, Kathleen O’Donnell claims investors who buy Australian government bonds should be made aware of the risks the country faces due to climate change, which could put the repayment of the bond at risk.

The claim also alleges that the nation’s economy and reputation in international financial markets will be significantly affected by climate change and how the government responds.

This could lead to bonds facing material risk from climate change, meaning investors should have the information disclosed to them.

By failing to disclose climate change risks to investors, the lawsuit alleged that the Commonwealth of Australia has breached its duty of disclosure and could be misleading or deceiving investors. 

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The claim follows a summer where Australia had its most intense bushfires for four months, which killed 33 people and burnt through over 12.5 minion hectares. 

The claim seeks declaration that the Commonwealth breached the law, as well as an injunction from the Federal Court to prevent further promotion of bonds without informing investors about climate change risks. 

Ms O’Donnell owns government bonds that mature in 2050, by which time, should the government fail to enact effective policies, the impacts of climate change are expected to have taken hold.

Australia has more than $600 billion of sovereign bonds on issue, which have been rated as AAA by the three major ratings agencies. 

Student files lawsuit over government bonds
Student files lawsuit over government bonds
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About the author

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Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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