Gen­er­al Coun­sel can help dri­ve ESG – but only with the right sup­port from the business

We are see­ing more and more about the role of Gen­er­al Coun­sel and in-house coun­sel when it comes to envi­ron­men­tal, social and gov­er­nance (ESG) issues. 

The Finan­cial Times recent­ly report­ed on the role the legal depart­ment is able to play in shap­ing and influ­enc­ing their com­pa­nies when it comes to branch­ing out into ESG. 

At a recent Law Soci­ety Con­fer­ence, there was a pow­er­ful call to action by Lawyers for Net Zero, stat­ing that legal teams are unique­ly placed to influ­ence their business’s response to the cli­mate crisis. 

In terms of longer papers, Ernst and Young have released a study on how legal depart­ments are key to unlock­ing the sus­tain­abil­i­ty strate­gies for their organisations. 

The pres­sure is on. 

And it’s true that Gen­er­al Coun­sel are well posi­tioned to help dri­ve ESG ini­tia­tives. They have a broad overview of every­thing that is going on in the busi­ness. They are seen as sen­si­ble arbiters of fair­ness and as trust­ed advis­ers to the busi­ness. They can influ­ence change at the high­est lev­els not only with­in their own organ­i­sa­tions, but also through their law firm panels. 

As for­mer Gen­er­al Coun­sels our­selves at Lex­So­lu­tions, we talked about some ways Gen­er­al Coun­sel can play a crit­i­cal role in dri­ving ESG ini­tia­tives for­ward and become ESG champions. 

Edu­cat­ing the busi­ness on ESG issues

What are the ESG issues for your com­pa­ny, why do they mat­ter and how can you, as Gen­er­al Coun­sel help inform and edu­cate stake­hold­ers? Gen­er­al Coun­sel and legal teams can all play a role in build­ing a shared under­stand­ing of the impor­tance of ESG, their rel­e­vance to and oppor­tu­ni­ty for their busi­ness­es and cre­at­ing buy-in across the busi­ness for initiatives. 

Being the ESG go-to

As com­pa­nies face increas­ing scruti­ny on their ESG prac­tices, Gen­er­al Coun­sel can play a role as a go-to for infor­ma­tion when it comes to the legal issues relat­ed to ESG mat­ters, from help­ing to design soci­etal­ly impact­ful poli­cies and ini­tia­tives to com­pli­ance with reg­u­la­tions and han­dling inves­ti­ga­tions and enforce­ment. It is increas­ing­ly becom­ing the role of Gen­er­al Coun­sel to help com­pa­nies nav­i­gate the ever-chang­ing land­scape of ESG-relat­ed laws, reg­u­la­tions and opportunities. 

Engag­ing with investors on ESG issues 

This may involve pro­vid­ing input on ESG-relat­ed dis­clo­sure, respond­ing to investor enquiries, and tak­ing part in investor meet­ings and calls. We are see­ing this increas­ing with many of the scale-up clients we work with who are going through fund­ing rounds. Gen­er­al Coun­sel can also help draft share­hold­er res­o­lu­tions on ESG topics. 

Devel­op­ing and imple­ment­ing ESG poli­cies and programs 

Gen­er­al Coun­sel can help devel­op and imple­ment poli­cies and pro­grams relat­ed to ESG. This could be input on cor­po­rate sus­tain­abil­i­ty goals, draft­ing inter­nal poli­cies and pro­ce­dures, and coor­di­nat­ing with oth­er depart­ments to ensure com­pli­ance with ESG-relat­ed laws and reg­u­la­tions. They can also help respond to requests for pro­pos­al (RFPs) that include ESG cri­te­ria and assist with report­ing on ESG met­rics. In line with this, Gen­er­al Coun­sel can ensure they ask same of their law firm pan­el when going out to ten­der to dri­ve best prac­tice ESG through the sup­ply chain. 

Com­mu­ni­cat­ing with the Board

Work­ing at the most senior lev­el with­in a busi­ness, Gen­er­al Coun­sel can keep the Board informed when it comes to ESG and how the com­pa­ny is meet­ing its ESG goals, pro­vid­ing guid­ance and sug­ges­tions on how to inte­grate ESG con­sid­er­a­tions into the company’s strategy. 

But – let’s address the ele­phant in the room. 

This is a lot of work for Gen­er­al Coun­sel, on top of an already chal­leng­ing and grow­ing remit. 

It requires Gen­er­al Coun­sel to stay up-to-date on ESG devel­op­ments includ­ing new laws and reg­u­la­tions, indus­try trends and best practices. 

It comes with a new pres­sure to be not only the legal role mod­el, but an ESG role mod­el, set­ting the tone for the company’s approach and lead­ing by example. 

Where to start? 

Help­ing Gen­er­al Coun­sel with their approach to ESG

At Lex­So­lu­tions we have been work­ing with Gen­er­al Coun­sel to help them map out their legal team’s approach to ESG. 

We do this via our Legal Dis­cov­ery Work­shops to ensure Gen­er­al Coun­sels have an ESG roadmap for the future. It’s some­thing the whole legal team can take part in, ensur­ing own­er­ship and alignment. 

We also pro­vide Gen­er­al Coun­sel with access to our DNA Diag­nos­tic (which we have devel­oped along­side The Matu­ri­ty Insti­tute) to get a true mea­sure of their pan­el law firms. Our DNA Diag­nos­tic inte­grates The Matu­ri­ty Insti­tute​’s OMIN­DEX® Work­force mea­sures. It unpacks the key causal fac­tors across a law fir­m’s whole sys­tem help­ing law firms build roadmaps for ESG, D&I and Matu­ri­ty improve­ment. By col­lab­o­rat­ing with their law firm pan­els on this, Gen­er­al Coun­sel are sup­port­ing them to reveal the data they need to close gaps, ele­vate their cul­ture and dri­ve mean­ing­ful impact. It helps dri­ves com­mit­ment to ESG through the entire sup­ply chain. 

We have a role to play in in-house legal when it comes to mak­ing sure ESG is top of the agen­da – our chal­lenge is ensur­ing the busi­ness­es sup­ports us to do this crit­i­cal aspect to our jobs as Gen­er­al Coun­sel and senior in-house lawyers. That’s why we have devel­oped two tools at Lex­So­lu­tions to make it eas­i­er for you to start on this journey. 

If you would like to find out about a Legal Dis­cov­ery Work­shop to map your legal team’s approach to ESG, get in touch with one of the Lex team.

If you would like to find out about the DNA Diag­nos­tic and how this could work for you and your team and your law firm pan­el, get in touch with one of the Lex­So­lu­tions team. 

19 Jul