The Law Society has recently released unprecedented guidance aimed to help solicitors navigate their practice in the highly topical context of climate change, titled: “The impact of climate change on solicitors” (the “guidance”). Whilst the SRA is supportive of this guidance, it is important to note this should not be considered their regulatory position on the issue.
Under part A of the guidance, organisations are advised to understand and measure the greenhouse gas emissions connected with their business in order to help identify their greatest source of emissions. Whilst some causes of emissions may be obvious, such as business travel, other contributors, such as emissions related to cleaning products, are less so.
Part A also focuses on “science-based targets” and “climate risk disclosure frameworks”. Organisations may wish to commit themselves to targets to reduce their emissions and consider setting up a reporting framework to keep them on track. Notably, organisations such as LLPs may be already required to comply with requirements, such as the UK’s Streamlined Energy and Carbon Reporting regime.
Greenwashing, which is the concept of making false or misleading claims about positive impacts on the environment, is also addressed. Whilst it is important to communicate an organisation’s commitment, law firms should ensure they are careful not to overstate the sustainable nature of their business and to adhere to the rules of the SRA and/or other regulators.
Part B of the guidance discusses the risks for solicitors and organisations connected to climate change. The physical risks of climate change, such as flooding and fires are clear to see. However, solicitors also need to be aware of the legal risks associated with such physical risks. For example, the guidance notes how commercial and corporate transactions may be affected by issues such as ‘insurability’ and ‘value’.
A large portion of Part B focusses on ‘the impact of climate change legal risks on solicitors’ professional duties’. The guidance states that solicitors have a duty to disclose to their clients all information material to the client’s matter of which the solicitor has actual knowledge. For example, if a solicitor became aware that legal risks linked to climate change may affect the client’s interests, these risks should be disclosed to the client ‘in a clear and understandable way’.
The guidance also considers the SRA principles and suggests that duties (and the way which they relate to the climate crisis) could come under greater scrutiny in the coming years as the crisis is likely to worsen. This is especially important in relation to SRA principle ‘2’, whereby solicitors’ have a duty to maintain public trust and confidence in the profession. Therefore, law firms may need to consider ‘developing expertise in relation to climate change’ in order to ensure their solicitors’ are able to adhere to this duty.
Additionally, the impact of climate change on the solicitor-client relationship is contemplated in Part B, particularly with regard to whether a solicitor should advise a client. In this case, a solicitor may wish to consider whether they are competent to advise the client, and whether they have the relevant expertise to advise on a climate related issue. Decisions not to act should be taken in accordance with the firm’s policies and regulatory obligations and ultimately communicated in writing to the potential client.
One of the final subjects considered in the guidance is whether the terms of a retainer can be limited to exclude matters related to climate issues, thus reducing a solicitor’s duties. However, this is not always reasonable or practical and due consideration should always be given.
Solicitors are advised to check that their current and future professional indemnity insurance covers them for advising on climate related issues.
Overall, it is clear that climate change is now unavoidable in any aspect of our lives, and this includes our professional lives.
Our key take-aways from this guidance are as follows:
- Organisations should become aware of their own impact on the climate and should consider setting up frameworks and reporting structures to manage this. This will help to avoid claims of greenwashing and uphold the public trust and confidence in the solicitors’ profession.
- Solicitors should remain vigilant to climate related risks which may arise during a client’s matter and should disclose the same if they arise. This will maintain compliance with regulatory duties.
- Solicitors should always consider whether they have the required knowledge to advise a client on climate related issues. Without appropriate consideration, inaccurate advice may be given. Nonetheless, solicitors should not be hasty in turning a client away simply because their matter involves climate related issues, meaning a balanced and considered decision-making process should be followed at all times.