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Alumni matters: A LAW FIRM’S ROLE IN ADVANCING ESG

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Herbert Smith Freehills chief Justin D'Agostino sets out how a leading law firm can drive the ESG agenda forwards.

Our CEO Justin D'Agostino delivered this speech at a panel hosted by the IBA's Section on Public and Professional Interest. Titled "Bridging the gap – the UN Sustainable Development Goals (SDGs) and Environmental, Social, and Governance (ESG) issues for the global legal profession" was designed to highlight the growing importance, and convergence, of the UN SDGs and the private sector concepts embodied in ESG, and the implications of both for the global legal profession.

Outside our firm commitments, our greatest impact can come from assisting our clients with their own programmes for ESG and responsible business conduct.

By acting as advocates, architects and guides, we can spread understanding at the very highest levels of boards. And legal counsel are central to ESG advancement.

Earlier this year, we formed a new ESG team within Herbert Smith Freehills. It brought together lawyers with existing expertise to lead these issues across our practices and client base.

To mark this development, we issued a report – entitled Responsibility Incorporated – based on interviews with 20 general counsel at major international companies.

What was striking to me was that ESG was at the very top of the agenda of these general counsel, and considered strategically critical to their organisation. And these GCs were increasingly likely to have been given significant responsibility for oversight and leadership on ESG issues.

The interviews confirmed that lawyers were already playing a leading role in implementing ESG strategies and resolving challenges faced in their business.

I speak regularly with our clients’ senior counsel and executives. In the past 18 months, ESG has been raised as an issue in every conversation. But for many clients, ESG is no longer solely about new governance frameworks, strategies or risk assessments.

We are increasingly working with clients that are seeking to utterly transform their businesses in pursuit of net zero targets or social impact goals.

And from my base in Asia, I see this drive in both the oldest and newest companies, from the global titans that are Japan and South Korea’s trading houses and chaebol, to the newest unicorns emerging from Southeast Asia and China.

This shift is hugely encouraging and very necessary. Achieving the SDGs and net zero goals in the aftermath of the pandemic will require huge amounts of investment and innovation.

It will also require a positive outlook; a desire to create transformative and equitable opportunities from the challenges we face.

Lawyers have long played a critical role in these shifts – in government, in institutions, in law firms and in companies.

I believe that in the coming months we will only see that role expand, and quickly