How should solicitors take account of the climate crisis? The Law Society Guidance
In April the Law Society published much awaited guidance on the impact of climate change on solicitors. The guidance is supported by the Solicitors Regulation Authority.
According to the Law Society, solicitors should:
understand
their firm’s and clients’ climate impact, including scope 1, 2 and 3 emissions and ‘advised emissions’ associated with matters advised on
climate-related risks and opportunities relevant to their practice area
that a firm’s ability to attract and retain talent may be significantly influenced by its approach to climate change
that SRA Principles, such as the duty to act in a way that upholds public trust and confidence and the duty to act with integrity, may fall under closer scrutiny as climate change becomes more pronounced
that climate-related issues may be valid considerations in determining whether to act for a client and whether to accept instructions
be aware of
their firm's and clients' transition plans
their ability to decide to decline instructions (provided they give reasons and don't unlawfully discriminate)
the increasing scrutiny of advised emissions
other relevant professionals whose skills may be needed e.g. technical advisors
consider
setting science-based targets in line with the 1.5˚C Paris Agreement goal
whether it is consistent to accept instruction and advise on matters that are incompatible with their firm's climate change commitments
communicate
their approach to providing advice in the context of climate change to clients, prospective clients, and the public
all disclosures necessary to comply with applicable climate risk disclosure frameworks
to the client, reasons for deciding not to accept an instruction
provide advice on
climate legal risks, looking ‘beyond the narrow scope of an instruction by a client to consider whether and to what extent climate legal risks are relevant’
engage
appropriate educational support to enable them to provide competent advice on climate legal risks
obtain
informed consent from the client if their scope of work will exclude advice on relevant climate legal risks that are outside of their competence (noting that it is becoming less realistic to exclude consideration of such matters)
professional indemnity insurance that covers the advice they’re giving (and be prepared to demonstrate to insurers how they are equipping themselves to advise on climate legal risks)
look out for
sector-specific guidance from the Law Society on climate legal risks
other relevant professionals whose skills may be needed to provide advice on climate risks e.g. technical advisors
make sure they don't
engage in greenwashing by publishing information that mischaracterises or overstates their firm's targets or progress made against those targets.
Perhaps the knottiest issue addressed in the guidance is advised emissions. For most lawyers, their greatest contribution to global emissions is those that result from matters they advise on. These 'scope four' emissions don't fit within one of the three established scopes under the Greenhouse Gas Protocol.
Advised emissions are subject to increasing scrutiny, but the question of how firms can continue to act as a client-focused service while exercising appropriate influence hasn't been an easy one to answer.
In the Carbon Literacy training I facilitate (supported by the Carbon Literacy Project) we talk a lot about levers of influence, and we've had some engaging discussions about the positive influence lawyers can have while serving their clients.
The Law Society backs this up, saying 'firms that are committed to pursuing the 1.5°C Paris Agreement goal should also consider how they might be able to influence the reduction of advised emissions in line with their broader target setting'.
How might we do this? The guidance suggests brushing up on your firm and clients' transition plans, understanding climate-related risks and opportunities relevant to your practice area and advising your clients about the same, advising clients who are working to reduce their emissions, and 'considering whether it is consistent to accept instruction and to advise on certain matters that the firm decides are incompatible with its climate change commitments.'
The discussion about whether a law firm can, or should, reject instructions that aren't compatible with climate goals has bubbled away for years, with some lawyers of the view that it just can't or won't happen.
The Law Students for Climate Accountability (LSCA)'s Carbon Circle Report in May looked at the work lawyers do for fossil fuel companies and found that in the context of transactional work, 55 firms facilitated £1.48 trillion in fossil fuel projects between 2018 and 2022. The report totted up the fossil fuel advice of Magic Circle law firms and found the five firms facilitated over £285 billion in transactional fossil fuel work, so they were dubbed the Carbon Circle. The report criticises law firms' failure to align their advised emissions with their internal ESG goals.
The LSCA report also notes, as does the Law Society guidance, that firms are at risk of being unable to recruit the best talent if they don't align their advised emissions policy to their climate goals.
The suggestions of the LSCA include, among other things, law students asking firms about their advice record, and for associates: requesting to opt out of fossil fuel matters and seeking out renewable energy clients (if you're looking for a renewable energy team, I know a great one...). The LSCA says law firms should tackle advised emissions, avoid greenwashing, and allow lawyers to opt out of fossil fuel work.
Doubts have been expressed about the ability of law firms to effect the kind of change necessary to tackle advised emissions. The LSCA report makes the point that many firms took quick and decisive action to close offices in Russia and drop Russian oil clients following Russia's invasion of Ukraine, making it 'clear that, if they have the will to do so, firms are perfectly capable of deciding that servicing fossil fuel clients is not in keeping with their values.'
There will be nuance in the positions adopted. As Alasdair Cameron notes in this article, good lawyers are needed to support emitters in the transition to net zero. Issues such as responsible divestment and winding down of fossil fuel assets require legal support too.
The Law Society guidance suggests other ways to take account of the climate crisis and reduce advised emissions, like advising on climate legal risks. There are a host of organisations that can help with this.
The Chancery Lane Project provides tools to support lawyers in aligning their contracts with net zero.
Legal Voices for the Future encourages discourse and action on the climate and ecological crises.
The Net Zero Lawyers Alliance aims to mobilise commercial lawyers, law firms and the law to accelerate the transition to net zero.
The Carbon Literacy Project runs a programme that allows lawyers and others to be certified as Carbon Literate.
There are also initiatives specific to practice areas, such as the Greener Litigation Pledge.
Will we see law firms publishing their approach to reducing advised emissions? How will firms approach the thorny topic of deciding when to decline instructions? Will we see firm-wide policies supporting lawyers who opt out of work on matters that contribute to the climate crisis?
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