Law Firm ESG: Five Key Observations

What We’ve Learnt About Law Firm ESG by Working on Legal 500 Green Guide Submissions

In recent months we’ve been collaborating with our sister company, Kidd Aitken Legal Marketing, to support several clients with their submissions to the Legal 500’s excellent Green Guide. We’ve been helping firms to communicate their current performance, as well as identifying improvement areas concerning their internal initiatives. The Green Guide is the first legal directory focused on a comprehensive assessment of law firms’ contributions to the green transition. It considers not just client work but also a firm’s own internal policies and initiatives. If you’re looking for a way to gain free third-party recognition for your firm’s ESG positioning, it’s a great option – albeit an increasingly competitive one.

So, what have we learnt that could help you with your own firm’s sustainability journey?

  1. Impacts need to be measured and then monitored. There is still a tendency to either implement policies based on anecdotal data or to measure once without then monitoring the impact of the policy. Why is this important? Continual improvement is key to reducing sustainability impacts, and it is widely agreed that a cyclical approach of ‘Assess, Plan, Implement, Evaluate’ is most effective. The whole process should begin with a materiality assessment, which allows you to both engage with stakeholders and allocate resources based on priority areas.  

  1. Firms with a dedicated ESG or Sustainability Manager tend to have more advanced internal policies and communications. ESG might lie, for example, with the managing partner or head of the firm’s ESG compliance practice; or it might lie with a sustainability committee or steering group. All of these can be effective options, provided there is clear communication between—and engagement of—firm management (i.e. the decision makers), anyone developing the policies and the wider firm. What we observed, however, was that firms with a full-time ESG Manager who operated at management level tended to have better developed positions. These individuals have more time to focus on driving the agenda and are able to communicate up and down the hierarchy; practising lawyers are always going to have competing priorities.

  1. Where there’s data, it too often goes unreported. It is not uncommon for firms to have measured aspects of their environmental performance and not to have reported those findings. Whether or not this is intentional greenhushing, it is a missed opportunity to demonstrate to clients and potential talent that you are aware of your impacts and that you are addressing them. A generic sustainability statement is not going to be enough for many: What targets have you set? What are those targets based on? How are you managing progress towards them? Don’t be afraid to open yourself up to scrutiny – some great ideas could come from it.

  1. Pro bono work is largely focused on the S and not the E of ESG. This is somewhat understandable given the long history of pro bono work and the role of social responsibility in recent decades. Nevertheless, pro bono programmes represent a great opportunity to tailor a response to both the environmental and social issues that arise in client work. Rather than having pro bono as a siloed function providing ad hoc support, why not weave it into the firm’s wider sustainability strategy and establish official partnerships with relevant organisations? With a growing focus on advised emissions and advised sustainability impacts, pro bono represents a way to address some of the inevitable issues that arise as society (and your clients) transition towards greater sustainability.

  1. An engaging narrative is important. For a successful ESG/sustainability strategy, you need to bring people along with you. People need to be motivated by your ambitions and kept up to date on progress and what they can do to contribute. They need to buy into the vision and understand the reasoning. One of the highlights we identified was firms addressing their history. For example, a firm with a long-established shipping practice had, through a mix of partnership agreements, pro bono and targeted client work, begun supporting the industry’s decarbonisation efforts. That story of collaborative mitigation is compelling, and one that is sure to engage purpose-driven lawyers as well as clients.