“Distributive fiscal justice” as a new dimension of corporate legitimacy in climate governance: a conceptual insight and foresight

Purpose The purpose of this conceptual paper is to understand how corporate tax transparency shapes social equity in climate governance. Design/methodology/approach Through a qualitative, theory-building design, grounded in a systematic literature review, this study brings together environmental justice theory, legitimacy theory, institutional theory and political economy to develop an integrative conceptual framework that challenges existing assumptions, using a critical theorist standpoint. Findings The synthesis outcomes indicate that fiscal legitimacy is constituted across three interdependent dimensions – procedural, cognitive and distributive – and that prevailing environmental, social and governance (ESG) frameworks capture only the first. The study provides a normative standard for evaluating whether corporate tax practices contribute equitably to public revenues in climate-vulnerable jurisdictions. It theorises a structural fiscal-climatic injustice cycle through which corporate tax avoidance may constrain domestic adaptation finance in Global South countries, a synthesis outcome advanced as theoretically plausible rather than as an established causal claim. Research limitations/implications This study is conceptual and does not include primary empirical data, which limits the strength of causal claims. Future research should apply quantitative methodologies to test the fiscal-climatic injustice cycle and assess whether mandatory country-by-country reporting regimes demonstrably improve adaptation finance adequacy. Case study research in high-vulnerability, low-income country contexts – particularly in Sub-Saharan Africa and Small Island Developing States – is essential to operationalise distributive fiscal justice with country-specific baselines. The effective-tax-rate gap, revenue-profit alignment ratio and adaptation finance contribution gap indicators warrant testing in specific national and sectoral settings, particularly climate-vulnerable jurisdictions. Practical implications For companies, this study recommends conducting fiscal legitimacy audits and voluntarily publishing total tax contribution reports alongside sustainability disclosures. Board-level tax governance mechanisms should be established, with fiscal coherence indicators that explicitly link tax disclosures to climate policy outcomes. For ESG rating agencies and standard setters, the study provides a blueprint for integrating a distributive fiscal justice pillar into assessment architectures. For governments in developing countries, corporate fiscal responsibility should be recognised as a climate finance issue. United Nations Framework Convention on Climate Change negotiations should incorporate corporate tax transparency provisions into climate finance mechanisms. Social implications The study highlights structural harms that disproportionately affect communities in the Global South. It identifies this harm as a manifestation of distributive injustice and incorporates it into ESG governance discourse, thereby generating normative pressure for systemic reform. Repositioning corporate fiscal conduct as a social equity issue has the potential to shift the terms of climate finance advocacy, empowering affected communities and their governments to make legitimate claims about the fiscal contributions of companies operating within their borders. Originality/value The study proposes a construct dubbed “distributive fiscal justice”, a new sub-dimension of fiscal legitimacy that captures the equity implications of corporate tax behaviour and links individual company behaviour to collective climate vulnerability. It reveals areas where the prevailing ESG and corporate social responsibility disclosure frameworks fall short of equity demands. It positions tax transparency as a non-negotiable foundation for equitable climate governance. It offers five theoretical propositions that inform the empirical agenda and policy reform.