Talks with TLS: Climate Change and Legal Practices

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Danielle Giannecchini, Regional Director at TransPerfect Legal Solutions (TLS), recently had a virtual meet-up with Wendy Miles, a Barrister at Twenty Essex with over 25 years of experience in multiple sectors. Wendy has advised on international law matters and conducted arbitrations under all the major institutions. She has also served as global coordinating counsel to major corporates in relation to climate change law, transition, disclosure, reporting, compliance and investment.

You have a wealth of experience in arbitration and a keen interest in how corporates and law firms can tackle the climate change crisis. What are some key differences lawyers need to consider when involved with climate change cases versus standard commercial disputes?

Wendy: If we focus just on commercial disputes, you might recall from the ICC Climate Change Related Disputes and ADR report that we identified three categories of contracts that could give rise to climate change-related disputes:

  1. Disputes arising out of contracts that facilitate transition to net zero (mitigation contracts) or contracts for adaptation to deal with climate change effects (adaptation contracts);
  2. Disputes arising out of existing non-climate change related agreements, where the dispute results from climate change related mitigation or adaptation action by a party, and;
  3. Disputes arising out of express submission agreements, where parties agree to refer a more bespoke ‘climate change related dispute’ to arbitration after it has arisen (e.g., where an affected population has a climate-related claim against a government or corporate party).

What makes a dispute climate change-related is that its resolution engages issues that affect or may affect the implementation of climate change mitigation or adaptation measures. Sometimes, these will be easy to identify. The recent solar power claims against the Spanish government (in contract and under treaty) for changes to its regulations governing feed-in tariffs for new solar operations are disputes arising out of climate change-related agreements.

Other situations will be more nuanced. For example: where a government was to amend an environmental permit to cover a reduction in Greenhouse Gas emissions, requiring major adjustment to a facility (e.g., establishment of a CCS sub-facility) not specifically provided for in the underlying agreement, but necessary in order for the contracting state to meet its own Paris Agreement commitments.

From your private practice experience, how are law firms being asked to prove their sustainability credentials when bidding for panel work?

Wendy: London law firms are really starting to take initiative in reducing their emissions, and there are several ‘green’ arbitration and litigation protocols in the offing. This is an important start, and every little bit helps. But the place for lawyers to implement real change and materially move the needle toward net zero is in looking for ways to work with clients across all practice areas to embed climate change transition into the legal instruments that facilitate their business transactions.

UK and EU corporates are increasingly strengthening their own net zero targets, and commitments across their businesses and groups are doing the same in many industries. As lawyers, we have the tools, expertise and power to innovate and ensure that those pledges and targets find their way into those parties’ private international law instruments, in order to best ensure that transition succeeds.

Outside of the policies and initiatives corporates are promoting internally and expecting of their suppliers, what else can be done by way of third-party consulting on sustainability, and why would a company choose to go down that route?

Wendy: Lawyers are the quintessential third-party consultants; our consulting speciality is the law. But transition to net zero requires systemic change across global energy, infrastructure, industrial and land use, and that does not happen through one sector or one profession. Systemic change calls for systemic cooperation and a greater awareness of the effect of each part on the whole. As lawyers, our inclination (and strength) is in our analytics; we can drill into a problem and analyse it until there is nothing left to analyse. We are less skilled at stepping back and looking at the bigger picture of our deal, case or task and how it fits into and impacts broader considerations in the corporation, industry, country, sector or even the planet.

The Lawyer published an article earlier this year shining a light on companies with a polluting track record including some of the largest clients of city law firms. Do you have experience working with a traditional “polluter” client, and how do you see these companies shifting the narrative and genuinely promoting change from within? How did that cross over with any legal work you were involved in?

Wendy: If “polluter” means anyone who emits CO2 then we are all polluters – we do it every time we exhale. We do it a lot more when we drive our cars, fly in planes, catch diesel trains, hop in a taxi or turn on the air conditioning. Systemic change requires each and every one of us to make changes to how we live and work.

The villains and heroes narrative does not really get us to net zero. We are past that; enough people now accept and understand what needs to be done. The real challenge is not looking for someone to blame, but figuring out how we implement systemic transition. We need to turn an almost entirely carbon-based society into a decarbonised one in a few short decades. The energy, aviation and cement companies all play a huge part in that transition. If we work with one another and not against one another, then we have a prospect of success.

Do you believe The Green Pledge (Campaign for Greener Arbitrations) has made a material impact on the industry thus far? How was COVID-19 accelerated some aspects of The Pledge?

Wendy: I think these pledges are really important because they demonstrate understanding and commitment to what is required by everyone in reaching net zero. Lawyers don’t have a massive carbon footprint, so green arbitration will not materially move the needle on the 1.5 degree C target. But, as I mentioned earlier, we work on a daily basis with those who do, and we make the real difference by properly understanding what our clients are trying to achieve and marshalling our best skills in helping to memorialise that into their legal instruments.

From my conversations “on the ground”, many junior lawyers are eager to get involved in this space. What advice you would give them?

Wendy: Study science, and learn everything you can about climate change and the science of GHG emissions and reduction. Read the IPCC Special Report 1.5 (the 1.5 degree report from October 2018). Work with groups that promote climate objectives. Press your senior partners to implement carbon reduction targets in the office; it does not move the needle a lot, but it focuses minds. If you are working in-house, start building a requirement for climate transition commitment into panel guidelines.

And finally, what have you found to be the most positive change you’ve had in your life (professional or otherwise) in the past 12 months?

Wendy: Six months into lockdown in the UK, the most positive change for me has been the gift of time and space out of the busyness of the office, London and international travel to reflect on what matters to me and where I want to dedicate my time and effort going forward.

Professionally, I’m excited about the new skills we’ve acquired and how effectively we’ve adapted to virtual dispute resolution in a resolutely international field. It suits us, and we would do well to retain much of what we’ve developed even after a vaccine.

Personally, I have had six months to spend daily time with my husband and our sons before they head off to university, and I think that has had a deeply positive and hopefully lasting impact on us all. As a busy working mother, I think over the last 18 years I lost sight of how little of me was left at the end of each day – and week – for our family. Sometimes, we just need to stop and breathe and appreciate what we have.

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