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Climate crisis: Law firms can have major impact through client work
As the latest UN climate change report issues another stark warning to all industries to limit global emissions, some in the legal profession are attempting to lead the way.
In 2020, Clifford Chance Senior Partner Jeroen Ouwehand caused a stir when he told delegates at the Green Horizon Summit that law firms did ‘not have to be neutral professional service providers.’ Two years on, he tells Global Insight why the escalating climate crisis has made those words truer than ever. ‘The IPCC reports have stated that we need to all come together to battle climate change,’ he says. ‘We've got our own net zero targets, but that is not the huge impact. Where we can have a big impact is in the work that we do with our clients.’
Ouwehand says law firm advice should consider the impact of their work, not only on their immediate clients, but also their wider stakeholders. ‘That can be part of our service and acting responsibly, by its very nature, sometimes means you can't be neutral,’ he says.
It was this realisation, he says, that prompted the firm to quietly roll out a policy last year that will see it increasingly ‘assess climate change impacts in its matter acceptance process’. The policy is still evolving but Robin Abraham, Clifford Chance’s Executive Partner and General Counsel, believes it has already marked a key step-change for the firm. ‘We're reliant on the information we're able to find from the internet and what the clients tell us,’ he says. ‘But it maybe just involves a bit more thinking through the impact of what we're doing and who's actually taking part in the transaction and asking ourselves “Are they responsible actors?”’
Ouwehand hopes it will empower the firm’s lawyers to rise to the challenge of reversing climate change. ‘Where it is obvious that there's going to be a very negative climate impact, there are no mitigating factors and there are no intentions to try and do the best within the frameworks and rules that exist, then we might say no [to a client],’ he says. ‘That's what the climate policy is about and that's quite novel. I don't think any other firm, as far as I know, has done that.’
These suspicions were confirmed in a recent survey by legal thinktank RSGI, which found that Clifford Chance’s ‘responsible client selection’ policy was unique among the top 100 law firms worldwide by revenue.
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Where we can have a big impact is in the work we do with our clients
Jeroen Ouwehand
Senior Partner, Clifford Chance
The research also confirmed strong discrepancies in law firms’ commitment to sustainability. While 26 per cent of those surveyed had made ‘a significant investment in pro bono efforts to tackle the climate crisis’, only seven per cent had publicly committed themselves to a deadline to reach net zero carbon emissions. What’s more, only six per cent included a ‘stakeholder engagement process’ in their overall environmental, social and governance (ESG) strategy.
Vanessa Havard-Williams is global head of environment and climate change at Linklaters. She says that, while the firm doesn’t have a specific policy on client selection, the partnership is increasingly mindful of the ‘alignment and values’ it shares with clients as well as its own role in ‘acting as a responsible business for clients.’
The International Bar Association, the Law Society of England and Wales and the American Bar Association are just some of the organisations calling on lawyers to adopt a more ‘climate conscious’ approach to legal practice.
Havard-Williams believes all lawyers should be equipped with a sound understanding of how ESG issues intersect with their practice areas. ‘It means you're not just a small team of subject matter experts, you're much more than that and it's embedded into how you're engaging and advising,’ she says. ‘We're in the early phase of an industrial revolution, which is going to be pretty enormous and challenging. I don't think you can sidestep that as a professional adviser. You have to integrate the context in which you are advising into your advice because it affects the advice.’
Matthew Sparkes, Linklaters’ global head of sustainability, says firms and clients must work together to enable the energy transition. ‘Whether it's us or our clients, we're all faced with the same expectations and challenges,’ he says. ‘We have a responsibility on our own account and on behalf of our clients to help with the transition, which is something that we're all faced with.’
Maria Vizeu-Pinheiro, Environmental and Sustainability Policy Officer on the IBA Environment, Health and Safety Law Committee, agrees that law firms must invest in sustainability initiatives. ‘Law firms, like any other private enterprise, are required to shift the actual paradigm in order to achieve global sustainability and reach carbon neutrality,’ she says. ‘Due to their position, I believe law firms are a good ally in pushing this cause. Surely, much more should be done in the field, both internally by strengthening ESG policies and externally by providing high-quality legal advice and case selection.’
Both Havard-Williams and Ouwehand acknowledge that large, well-resourced law firms are in a strong position to make wholesale changes like this. But Sparkes says smaller firms can gain traction in this area while practices introduced during the pandemic – such as remote working and reduced travel – persist. ‘There’s a window of opportunity to make the most of [these behaviours] before things go back to the way they were,’ he says. ‘Firms can bed in some of that learning and habits and actually make quite a lot further forward than perhaps many of us were when we began.’
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