Santos Case – What We Have Understood Thus Far
On 17 February 2026, the Federal Court of Australia handed down its decision in Australasian Centre for Corporate Responsibility v Santos Limited [2026] FCA 96 — a closely watched case. Santos succeeded in defending all claims brought against it to date.
The decision offers some useful guidance for Australian companies making climate-related statements. It is also worth noting that ACCR filed an appeal on 19 March 2026, so the matter is not yet finalised.
What Happened
The Australasian Centre for Corporate Responsibility (ACCR), a not-for-profit shareholder advocacy organisation and Santos shareholder, commenced proceedings in the Federal Court in 2021. The allegations related to three documents — Santos’ 2020 Investor Day Presentation, 2020 Annual Report and 2021 Climate Change Report — in which Santos described natural gas as a “clean fuel” providing “clean energy”, referred to “clean” and “zero emissions” hydrogen, and outlined a Net Zero Roadmap with 2030 and 2040 targets.
ACCR argued these representations constituted misleading or deceptive conduct under the Corporations Act 2001 and the Australian Consumer Law. After a trial in late 2024, Justice Markovic dismissed all claims and ordered ACCR to pay Santos’ costs.
The Court’s Reasoning
Justice Markovic found that terms like “clean energy” and “zero emissions hydrogen” did not carry an absolute or literal meaning in the Australian energy industry at the time the statements were made. Assessed from the perspective of a reasonable investor — a large, diverse group with an interest in climate change but without scientific training — these terms were understood as comparative descriptors rather than guarantees of zero emissions.
The Court also found that Santos’ net zero targets were representations about future matters, and that Santos had reasonable grounds for making them. Santos was able to point to emissions modelling, strategic sustainability plans and board deliberations that substantiated its disclosures.
As UNSW climate litigation expert Dr Riona Moodley noted, the ruling turned on the evidence Santos was able to produce: “The central point is that Santos was able to convince the Court it had reasonable foundations for its claims. It doesn’t mean other companies can make aspirational targets without doing that work.”
Our View
Australian companies have become considerably more aware of their climate disclosures over the past four years — and that’s a positive development. What this case illustrates is that Santos had substantiated claims backed by documented evidence. The language used, however, attracted a formal legal challenge that took several years to resolve.
What we keep seeing with clients is the genuine difficulty of expressing climate ambitions clearly alongside what has actually been achieved so far. In practice, disclosure tends to develop gradually — deepening in scope as companies make progress on emissions reduction and build confidence in how their reports are being received. In that environment, the words chosen in climate disclosures are worth careful consideration.
This decision is not a green light for unrestricted climate claims — it is a useful reminder that well-substantiated disclosures, supported by sound governance and clear documentation, are more likely to withstand scrutiny.
Language Worth Reviewing
The Santos proceedings centred on a small number of terms that appear commonly in ESG disclosures. These are entirely legitimate and widely used — the consideration is whether they are accompanied by sufficient substantiation, context and qualification. Terms that may be worth reviewing in your own public-facing statements include:
- Clean — as in “clean energy”, “clean fuel”, “clean operations”
- Green — as in “green strategy”, “green company”, “greener future”
- Zero emissions — worth clarifying which scopes are covered and over what timeframe
- Carbon neutral — consider specifying the role of offsets relative to actual reductions
- Sustainable / Sustainability — ASIC has noted this term can mean different things to different audiences
- Natural — often used to imply environmental benefit; worth defining in context
- Optimal / Best practice — comparative superlatives benefit from supporting evidence
- Responsible — as in “responsible energy”, “responsible operations”
- Ethical — ASIC has noted “ethical investing” requires careful explanation of what it means in practice
- Net zero — future targets are strengthened by a credible, documented pathway
- Transition fuel — a term subject to varying interpretation across stakeholder groups
- Carbon offset / Carbon positive — methodology and scope are worth disclosing clearly
- Aligned with Paris — a specific, verifiable basis for this claim is advisable
None of these terms should be avoided outright — they are part of the standard vocabulary of climate reporting. The question is whether each one is properly explained and supported in the specific context in which it is used.
A Note on Greenhushing
One response to greenwashing risk is to disclose less — a phenomenon ASIC Chair Joe Longo has described as “greenhushing.” ASIC’s view is that this approach is not the answer. Declining to disclose genuine sustainability efforts in order to avoid scrutiny is, in ASIC’s words, simply another form of the same problem — an attempt to benefit from a perception of environmental responsibility without transparency about the underlying activities.
The goal is not less disclosure. It is clearer, better-substantiated disclosure.
A Good Place to Start
If your organisation does not yet have assurance over its climate disclosures, it may be worth bringing your sustainability and legal teams together to review your current public-facing climate statements — including your annual report, website, investor materials and marketing. The focus would be on identifying any language that could benefit from additional context, qualification or supporting evidence.
Companies working hard to understand and reduce their climate impact deserve to have that work reflected clearly in their disclosures — and a careful review of language is a practical step toward that.
Sources
- Australasian Centre for Corporate Responsibility v Santos Limited [2026] FCA 96, Federal Court of Australia, 17 February 2026
- White & Case, Federal Court of Australia Dismisses Santos Greenwashing Case, 27 February 2026
- Clifford Chance, Australian Court Dismisses Santos Greenwashing Case: Key Takeaways, 25 February 2026
- Allens, ACCR v Santos: Lessons for Mandatory Climate Reporting and Future ESG Litigation, 16 March 2026
- Kennedys Law, How Will This End? Lessons (So Far) from the ACCR v Santos Greenwashing Case, 1 April 2026
- GT Law, Greenwashing Decision: What the ACCR v Santos Case Means for Your Climate Disclosures, 25 February 2026
- UNSW Newsroom, Santos Case Ruling is ‘Not a Green Light for Greenwashing’, 25 February 2026 — Dr Riona Moodley, UNSW Institute for Climate Risk & Response
- ASIC, How to Avoid Greenwashing When Offering or Promoting Sustainability-Related Products (INFO 271), updated March 2026
- ASIC, Greenwashing: A View from the Regulator, Chair Joe Longo speech, May 2024
- Ashurst, Climate Litigation in Australia: Key Developments in 2025 and What’s Ahead for 2026, 19 February 2026
- Norton Rose Fulbright, How to Avoid Greenwashing: New Sustainability Disclosure Guidance, 2026
- University of Melbourne Climate Change Law database, ACCR v Santos case summary
Anabranch ESG Advisory provides independent advice on ESG strategy, climate disclosure, and sustainability reporting. The information in this article is general in nature and does not constitute legal or financial advice.
