Environmental issues have steadily climbed up law firms’ agendas. As corporates seek to capitalise on both consumers’ growing awareness of the need to save the planet, and government incentives on the environment, solicitors, as part of their clients’ supply chain, are responding by boosting their own green credentials.

Commitment to the environment, through sustainable practices, can also deliver cost savings, for example through eliminating unnecessary waste and maximising energy usage. Being ‘green’, many firms report, is also of growing importance in the recruitment and retention of staff.

Taking the lead from clients

‘Environment and climate change is much more important to our clients than it ever was,’ notes Caroline May, head of environment, safety and planning practice at global law firm Norton Rose in London. ‘It’s seen as a much more rational business issue now, rather than a nice bit of greenery for the corporate social responsibility brochure.’

Helen Garthwaite, UK head of construction and engineering at Taylor Wessing, concurs: ‘There has been a leap in awareness… Green issues were once just about the facilities manager trying to keep building operational costs down. Now they are a matter for the boardroom.’

This was confirmed by a report published at the start of the year by Taylor Wessing, entitled Hitting the Green Wall… and Beyond, a collaborative effort with the British Property Federation and UK consultancy Spada. Over 80% of respondents said that responsibility for green sustainability sat with senior management. The research surveyed over 7,000 individuals in the UK property sector.

‘To be able to give traditional legal advice in today’s business context, knowledge of environmental and sustainable legislation and practice is important,’ Garthwaite explains. ‘It’s something that’s becoming a fact of life for law firms.’

Driving the green agenda is the Climate Change Act 2008, which sets the UK’s legally binding targets to reduce greenhouse gas emissions by at least 34% by 2020 and by at least 80% by 2050, compared with 1990 levels. To assist with implementation, the government has introduced incentives such as the Feed-in Tariffs (FITs) scheme and the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme.

The CRC, introduced in April 2010, is a carbon-trading scheme that is compulsory for large, non-energy-intensive businesses, and public sector organisations operating in the UK. It requires participating organisations to report on their carbon and greenhouse gas emissions. The first CRC reporting deadline was 29 July, with substantial penalties for non-compliance. In October, for the first time, league tables will be published, ranking organisations for their performance on gas emissions and carbon footprint.

‘The CRC has increased the amount of instructions from clients who are asking about its impact on their business and what they need to do,’ says Garthwaite. These include commercial landlords and their tenants, as commercial property is estimated to contribute around a fifth of the UK’s carbon emissions.

The CRC has also contributed to a strong take-up of green agreements and ratings. Garthwaite explains: ‘There is an increase in the use of green ratings and green agreements and law firms need to know about these benchmarks that clients may wish to aspire to in their business dealings.’

Green agreements are typically green leases, building contracts, protocols and voluntary arrangements, such as memoranda of understanding between landlords and tenants, with provisions relating to energy efficiency measures and waste reduction management. According to the Hitting the Green Wall report, almost 60% of respondents had used some form of green agreement.

The report also highlights that, in response to legislative pressures to reduce carbon emissions, the property sector is making use of ‘a wealth of sustainable measurement tools’ – ratings or accreditations for high-performance green buildings such as BREEAM (Building Research Establishment Environmental Assessment Method) and its US equivalent, LEED (Leadership in Energy and Environmental Design (see first box, below)).

Renewable energy

An important element in law firms’ growing interest in green issues is the rapidly expanding renewable energy sector. This is driven by government incentives, such as the FITs scheme, which was introduced on 1 April 2010 to encourage smaller-scale electricity production from renewable technologies, such as anaerobic digestion (electricity generated from food waste), hydroelectricity, solar photovoltaic panels, and wind turbines.

Andrew Whitehead, who leads Martineau’s energy and climate change practice in Birmingham, says: ‘Many companies are installing solar and other renewables for their on-site demands. They are doing that because it is seen as a good thing from the corporate social responsibility point of view, but also because the Feed-in Tariffs are making it financially viable.’ Martineau recently acted for City-based fund manager Octopus Investments, advising on a number of solar photovoltaic projects across the UK which attracted FITs subsidies.

Simmons & Simmons is also seeing ‘substantial’ growth among clients faced with rising and volatile energy bills. ‘We are dealing with a number of large corporate clients who are becoming power companies and producing their own energy [for the first time],’ says Steven McNab, who leads the firm’s environmental and climate change practice.

The recession and the squeeze on costs have hit some green projects, McNab admits, but not where there has been a strong business case for them, such as in cutting costs on landfill and energy.

Norton Rose has also seen a surge in business linked to clients’ renewables projects, with the ‘green economy’ accounting for ‘a significant proportion’ of the firm’s business both in London and globally. ‘We’ve got instructions pouring from the sky,’ says May. ‘In the past five years we have seen a growing stimulus in the renewable energy sector, which has actually helped our firm through the recession,’ she adds.

These include large renewable energy projects, such as waste-to-energy and offshore wind. Norton Rose won a Stand Out award in the FT’s Innovative Lawyers survey in October 2010 for its work advising The Crown Estate on UK offshore wind farms – hailed as the world’s biggest renewable energy project, costing an estimated £100bn.

At Martineau, energy and climate change is an expanding sector, accounting for around 10% of the firm’s revenue. While there has been concern about government cuts to FITs subsidies for the larger solar farm projects (this change came into effect on 1 August), Whitehead does not believe this will hit overall investment levels, but that some funding will be redirected to other technologies, such as anaerobic digestion, where subsidies have actually increased.

Also, he notes that the government, in its Electricity Market Reform white paper, published on 12 July, is aiming to attract more than £110bn of investment into the UK over the next 10 years. The government wants to encourage growth of low-carbon energy and to meet the UK’s carbon emissions and renewable energy commitments. Furthermore, regardless of the economic situation, targets in the Climate Change Act still have to be met: ‘[Energy] is a relatively immune sector of the economy,’ he says.

As well as existing clients dipping their toes into renewables, potential new business for law firms is emerging among a raft of new start-ups which deliver ‘clean’ technologies, or ‘cleantech’. To service them, Simmons & Simmons has come up with an online toolkit with legal document templates and guides that is charged at a fixed cost. Launched in February, the Cleantech Curve package includes advice on employment contracts and incentives, intellectual property protection, customer and supplier contracts, and securing premises and leases.

‘Cleantech Curve is targeted at small companies which would not normally go to a big law firm. It is virtually everything young companies should need from lawyers in the first few years of their existence,’ McNab explains. Some of the technologies being developed by Cleantech Curve’s clients include a micro-wind turbine and a system for turning air into liquid nitrogen for cryogenic energy storage. Start-ups in this dynamic sector are clearly worth nurturing, McNab argues: ‘We regard them as very important clients of the future.’

Green building blocks

Cost and waste reduction are key drivers behind many law firms’ green activities. Consider Taylor Wessing’s building in London’s New Street Square. Built with sustainably sourced materials, it also boasts low-energy air conditioning, systems to cut the use of artificial light, and appliances and controls to reduce the amount of water consumed.

The building, the firm says, boasts a ‘very good’ BREEAM assessment, which sets the standard for environmental efficiency, including for energy and water use. With its landlord and fellow tenants, which include the Carbon Trust, Taylor Wessing has signed a green, non-binding memorandum of understanding (MOU) amending the main lease. Taylor Wessing’s environmental manager Keith Binks explains: ‘This is all of us working together to further minimise the environmental impact of this building.’

The MOU sets targets for reducing building emissions, increasing waste recycling and energy efficiency. Binks notes that in 2010/2011 these initiatives resulted in a 5% reduction in ‘building emissions’, the bulk of which related to electricity and gas consumption.

Reed Smith’s new London headquarters in Broadgate Tower in the City of London is BREEAM Excellent-rated, according to the law firm. It also has a ‘Silver’ LEED CI (Commercial Interiors) rating. Phil Page, the firm’s Europe and Middle East operations director, says: ‘Given that we operate globally, for our internal fit-out we have gone more towards LEED [rather than BREEAM], which is a more globally recognised standard.’ Reed Smith also has LEED accreditations for its buildings in Pittsburgh and San Francisco.

Reed Smith, adds Page, is part of the Broadgate Environmental Working Group, which brings together landlord Broadgate Estates, a wholly-owned subsidiary of British Land, and fellow tenants to work on initiatives to reduce carbon footprint and energy consumption. ‘The initiatives on reducing utility consumption have been very significant in terms of savings,’ says Page.

Broadgate Tower has heat recovery equipment, leak detection, and lighting controls, such as special light sensors that will switch off lights when not in use, or dim them when daylight increases. Reed Smith moved into the new building in April 2009. Good ongoing management and maintenance is just as important as the initial fit, adds Page. ‘There is a lot of brouhaha when these systems are first put in, but you have to ensure that they continue to operate and reflect the nature of your use.’

Despite being a global firm, Page notes that Reed Smith has also made ‘significant savings’ on air travel with ‘a huge investment in video conferencing’, from high-end facilities to access on single work stations. Martineau is trimming air travel, too.

Whitehead says: ‘Between our London and Birmingham offices we have got effective video conferencing, so we are not flying domestically unless we have to and are cutting down on international travel. We also have an internal offset scheme where we invest in local environmental projects as a way of partially offsetting the carbon associated with flying.’

Firms are also trying to tackle waste. Martineau has introduced ‘Follow me Printing’, which reduces the amount of uncollected print jobs that are either sent to the wrong printer or are sent when the printer is temporarily offline, resulting in multiple copies.

Wragge & Co is trying to reduce the amount of paper it uses – 24 million sheets in 2009/2010. Having failed to hit its 5% per-employee consumption reduction target, it is now tackling the problem by raising awareness, but above all, with automated double-sided printing. Director of facilities Penny March says: ‘There is no opt out, you actually have to reset your default and people would much rather let it run.’ The firm is now on course to achieve its target, says March.

Tenders and pitches

The greening process among law firms is being influenced by clients in other ways. ‘Increasingly, corporates that have environmental sustainability strategies want to know that their supply chain, including their lawyers, buy into their vision and goals,’ Garthwaite notes.

May explains: ‘When we are doing pitches and tenders with government departments we are asked about our environmental performance.’ Questions can vary from tender to tender, but may include whether or not a law firm participates in the CRC, and, in the near future, will extend to a firm’s league table position, she adds.

Phil Page, Europe and Middle East operations director at Reed Smith, agrees that clients are seeking information about a law firm’s own green initiatives. ‘Clients want to establish the green credentials of their supply chain. It’s a trend that has increased over the last couple of years and not just from the public sector but from the private sector too.’

Among clients’ expectations are law firms’ compliance with standards such as ISO 14001, a globally recognised certification setting out how organisations can put in place an effective environmental management system: ‘Certainly in the public sector you don’t get past the first tender stage without ISO 14001,’ says Taylor Wessing’s environmental manager Keith Binks. The firm obtained an ISO 14001 for its Environmental Management System (EMS) in 2009.

So, to be credible with increasingly green-savvy clients, law firms must demonstrate their environmental commitment.

May adds: ‘We try to walk the walk as well as to talk the talk. We operate in the low-carbon and renewable energy sector and if we are burning all the lights and dashing about in planes around the world I think it kind of undermines our credibility.’ May, for example, avoids flying when video conferencing will do.

Norton Rose recently joined the Legal Sector Alliance (LSA), a ‘movement’ of law firms working together to take action on climate change by reducing their carbon footprint and adopting environmentally sustainable practices.

The LSA, supported by the Prince of Wales’ Business in the Community charity and the Law Society, was launched in December 2008. It currently has 215 members, representing over 30% of solicitors in private practice in England and Wales, including 19 of the top 20 law firms.

The legal profession makes only a small contribution to UK plc’s overall carbon footprint. However, for Whitehead, whose firm is a founding member of the LSA, there are compelling business reasons to get involved in the LSA: ‘If you are advising on carbon efficiency and climate change laws and policies then you need to be able to demonstrate that you have brought those policies alive in your own business before you can purport to advise other businesses.’ He adds: ‘As a LSA member, you have to demonstrate that you are working to comply with the principles that we have established.’

Calculating law firms’ carbon footprint and taking positive steps to reduce it is the LSA’s most important principle. First, a system to measure members’ carbon footprint, the so-called LSA carbon footprint protocol, was developed collaboratively by LSA members. Having established a baseline, in August LSA’s 20 executive members, including Simmons & Simmons, Norton Rose and Martineau, agreed to encourage all members to set their own targets which ‘are intended to deliver a meaningful and progressive reduction in firms’ emissions’.

The two most significant contributors to law firms’ footprints are energy use in buildings and business travel.

Even before this public show of commitment there has been real progress. The LSA’s Carbon Footprint Protocol Report, published in March this year, showed that executive members cut their carbon emissions by an average of over 12% over the three years 2007/8 to 2009/10.

Another important principle of the alliance is that members should develop green-friendly procurement policies for key suppliers, such as cleaning, catering, stationery and recycling contractors. ‘We want our members to engage and share knowledge with their supply chain to ensure law firms are increasingly procuring in a sustainable way,’ says the LSA’s project manager Micael Johnstone.

For Norton Rose’s May, LSA also means sharing good practice on the environment within the profession. ‘We see it as joining up with our peers and colleagues to share what we are doing. I think so often law firms are so bound up in themselves, in their competitiveness, and I think people think more of us when we work collectively.’

Green and sustainable initiatives are a potentially important tool in recruiting and retaining talent. ‘Young-generation lawyers see a firm’s commitment to the environment as a key recruitment issue,’ Garthwaite says.

Simmons & Simmons, which says it was the first international law firm to achieve carbon neutral status across all its offices worldwide, in 2006, offers its lawyers the opportunity to get involved in pro bono initiatives tackling climate change. It does this through its support of the Legal Response Initiative launched in 2009 by lawyers from Oxfam and WWF-UK, and Carbon Leapfrog.

McNab concludes: ‘There are people who will look at those sorts of softer issues [corporate social responsibility and environmental responsibility] as indicators of the kind of firm you are.’

He adds: ‘That’s less relevant in the current market but when the economy is a bit more on track, it will become substantially more relevant.’

Beating carbon

Carbon Leapfrog, launched in September 2009, is a charity that provides free legal and other professional advice for UK and international carbon reduction projects.

Newly appointed chief executive officer, Giles Bristow, a former Slaughter & May environmental law specialist, says the organisation focuses uniquely on carbon reducing initiatives – a departure for lawyers who have traditionally done pro bono work on issues such as access to justice and human rights.

The charity is also different in that it is multi-sector. Bristow says: ‘It is not just lawyers, but also includes accountants, architects, financiers, environmental engineers. It’s about trying to galvanise cross-sector support for projects to make them succeed.’

Simmons & Simmons’ Steven McNab, founder and trustee of Carbon Leapfrog, describes it as ‘a dating agency that puts very carefully selected projects together with volunteers such as people like me and you who might want to do something green but only have a limited amount of time’. He adds: ‘It is designed to make it very easy for an individual to give their time and be really effective with it.’

Carbon Leapfrog has several projects on the go in the UK and overseas and, says Bristow, over the next 12 months the charity plans to get involved in work in some of London's poorest areas.

One example is Ham Hydro, which aims to install hydro power turbines on the River Thames at Teddington Weir. The project, supported by Norton Rose, will not only generate green electricity to power 900 households in the area, but will also, it is hoped, generate income to promote and develop other community projects in Ham and surrounding areas.

Carbon Leapfrog won Simmons & Simmons a Stand Out ranking in the FT’s Innovative Lawyers survey in October 2010, and contributed to the firm winning the Law Firm of the Year category at the BusinessGreen Leaders Awards 2011.

Marialuisa Taddia is a freelance journalist