Addressing advised emissions is increasingly being seen as a key means by which law firms can have a significant impact in their efforts to tackle the climate crisis. These are the indirect emissions associated with a company’s value chain, including those generated by using its products and/or services. For law firms and other professional services companies, these emissions arise from the advice provided to clients.

‘A professional services organisation’s significant impact is not its Scope 1, 2 and 3 [its direct, indirect and value chain emissions respectively], it’s what happens at the end of its value chain,’ says Amanda Carpenter, Chief Executive Officer of Achill Legal, ‘the business it does, the services it provides.’ According to the Law Society of England and Wales, ‘advised emissions are coming under increased scrutiny from some clients and stakeholders across a variety of sectors in the context of organisations’ climate commitments.’ As such, law firms need to understand how to address them. 

Carpenter is co-founder of the Legal Charter 1.5, which aims to bring together ambitious law firms to develop a methodology for measuring advised emissions. The work is being conducted in partnership with academic institutions with the goal of producing a quantitative framework, similar to that developed by the Greenhouse Gas Protocol for scope 1–3 emissions. 

‘The work that we’re doing is about raising this as a conversation with law firms and encouraging them to understand’ the climate impact of their advice, says Carpenter. She believes that finding a way to measure advised emissions is the first step towards addressing them because it’ll give law firm leaders the confidence they need to act.

In April, the Legal Charter 1.5 launched a toolkit to help firms with classification by providing metrics that assist in determining whether a matter is aligned with the goals of the Paris Agreement. In this toolkit, the Legal Charter 1.5 outline a number of reasons why classification is helpful, including as a means to increase engagement with stakeholders, to enable firms to report against regulations such as the EU’s Corporate Sustainability Reporting Directive and to understand growing and changing areas of their portfolios and therefore identify opportunities. 

Other organisations have also offered advice to firms on how to monitor their advised emissions. Oxford Net Zero, an interdisciplinary research initiative based at the University of Oxford, has produced a report – Catalysing climate action: The role of professional service providers in realizing a net-zero future – that highlights the need to address advised or serviced emissions. The report offers practical guidance on the steps firms can take to do so, which it refers to as a ‘serviced emissions continuous improvement cycle’.

The UN Race to Zero has also produced draft guiding principles for serviced emissions. These aim to develop consensus among professional services providers, including lawyers, on how to measure advised emissions.

Law firm leaders may feel anxious that addressing advised emissions means dropping certain clients. However, this doesn’t have to be the case. Carpenter says the Legal Charter 1.5 firmly states that developing an approach to advised emissions is not an agenda for divestment or for choosing not to work with certain sectors or clients. 

‘It’s at the matter level that these decisions should be assessed’, says Pamela Cone, Founder and Chief Executive Officer at consultancy Amity Advisory. For example, if a law firm is helping a fossil fuel company move to greener energy, that work would be assisting the transition to a net zero economy. Cone says that when lawyers are assessing the matters they take on, they should consider whether the work is part of a solution or instead is maintaining the status quo. 

Carpenter says understanding advised emissions helps firms to measure and be accountable for their emissions footprint and to take mitigating actions, and to work harder to drive down emissions elsewhere in their supply chain. 

A cultural change may still be needed for law firms to meet the challenge of advised emissions. ‘The business model of a law firm does not fit with real hard commitments’, says Robert van Beemen, Chair of the ESG Subcommittee of the IBA Law Firm Management Committee.

Fundamentally, law firm leaders should view addressing advised emissions as a strategic priority that’ll mitigate the risk of greenwashing – where false or misleading claims about the green or sustainable credentials of a product are made – by ensuring the organisation’s work reflects its net zero ambitions. Managing greenwashing risk is another reason given by the Legal Charter 1.5 as to why classification is important.

Viewing advised emissions strategically in this way should empower law firm leaders to approach the issue from a practical standpoint that’s concerned with the long-term success of the business. 

‘For law firms, it’s a two-pronged problem. One is about doing what you’re saying you’re going to do, and the other part is about futureproofing your business’, says Alasdair Cameron, a policy adviser on climate change, planning and environmental law at the Law Society of England and Wales. ‘The firms which take leadership on the position and engage with it will shape the debate and therefore they will receive the rewards.’

The author thanks the IBA’s Legal Policy & Research Unit for their assistance with this article.
 

Image credit: Deemerwha/Adobe stock.