Jacquelyn F MacLennan
Brussels
jacquelyn@jmaclennan.com

At the IBA 2023 Annual Conference in Paris, the Pro Bono Committee hosted a panel on the role of pro bono legal services in the ‘S’ of ESG or the ‘social’ in environmental and social governance. The session was chaired by Odette Geldenhuys from Webber Wentzel and featured a number of experts covering different regions: Douglass Cassel, King & Spalding; Juliana Ramalho and Mattos Filho; Takeshi Nemoto, Nishimura & Asahi; and myself.

The discussion identified many points of agreement about the importance of pro bono work and the impact of ESG on law firms, but made it clear there are many ways to understand ESG, and many ways in which law firms organise their offering of pro bono services and their ESG.

Understanding ESG

ESG is, quite simply, the topic of our time. At the 2023 IBA Annual Conference, ESG was in the title of almost 30 sessions. Increasingly, ESG is being criticised as a smokescreen for inconsistent reporting, for greenwashing and blue washing, for misleading rankings, for being everything to everyone and as a result, a meaningless mélange of initials with no real value. In light of this, the panel began by defining what is meant by ESG and its relevance to law firms. In essence, the Panel took the view that ESG has real value as a framework for holding entities to account in areas of crucial importance for our future. Pro bono work can be an important element of an entity’s ESG strategy, but pro bono work should not be equated with ESG work.

The question for the panel was the role – if any – pro bono should have in the S of ESG. Compared to the ‘E’ and the ‘G’, the ‘S’ is much less understood. The ‘E’ for environment is fairly obvious, touching on the impact of an organisation on the environment and its contribution to climate change, resource use, pollution, waste management, etc. The ‘G’ for governance is also clear, if broad, touching on how an organisation is arranged, what oversight there is on its operations and its leadership, what are its internal controls, director obligations and shareholder rights. The ‘S’ for social is a concept which generally needs some unpacking as it covers the relationship of an organisation with the society around it, including its people, and covers employment and health and safety issues, diversity, inclusion and non-discrimination.

The ‘S’ covers relationships with wider communities affected by an organisation’s operations, and relationships with an organisation’s value chain. Although it may not be so evident, ‘S’ covers human rights, though this is a term which is also defined in different ways, and the ‘S’ goes wider, to include data privacy and Artificial Intelligence ethics. Finally, the ‘S’ is often considered to cover an organisation’s sustainability obligations, and progress in working for a sustainable future. In brief, the ‘S’ in ESG is extremely elastic, and mechanisms for measuring performance on the ‘S’ are emerging quickly.

Irrespective of the current debate on how ESG should be improved, or more radically, whether it should instead be encouraged to wither and die as a flawed and dangerous concept – the reality is that almost all large organisations these days, and many small entities, including law firms, have an ESG strategy, and are required to look at their own ESG profile. ESG has taken over from corporate citizenship or corporate social responsibility or corporate philanthropy. This is partly a reflection of the fact that ESG regulations and litigation are growing exponentially and cannot be ignored. It is also partly a reflection of the growing expectation coming from outside the confines of an organisation that it should be a good ESG citizen. This means that it should act responsibly and sustainably and provide leadership in matters of importance to society if it is going to attract investment, obtain customers or clients and attract and retain talented people.

Law firms and ESG

Law firms, as much as any other organisation, must comply with the ESG regulatory framework. Depending on where they operate, they may have to meet new corporate sustainability legislative reporting requirements and due diligence requirements, both because they are directly caught by the new rules or because they are part of the supply chain of their clients who will ask for information for their own reporting and due diligence obligations.^[1]

At the same time as law firms are tooling up with ESG specialist lawyers to be able to advise their clients on the ever-increasing number of ESG regulations, law firms are understanding that they are on their own ESG journeys and must engage in responding to client requirements and demands from staff regarding their own ESG footprint, in addition to their legal obligations. Law firm management is responding in different ways, but ESG strategies are evolving, formally and informally, throughout the profession. To date, most attention has been paid to E or environmental credentials and the adoption of green practices and technologies. Firms are also now concentrating on the ‘G’, or how they are governed, by looking at diversity and remuneration. Increasingly, the ‘S’ of their own practices and their supply chain is also in focus in terms of the approach to diversity generally, employment and remuneration practices, the avoidance of use of forced or child labour, etc.

There are now initiatives to rank law firms on their ESG scores, for example, the Law Firm Maturity Index^[2] or the rankings of the top 25 law firms by Impactvise.^[3] There are also an increasing number of consultants offering advice on law firm specific ESG strategies.

ESG and pro bono

Pro bono may not have the same buzz as ESG right now, but the panel emphasised that the importance of pro bono has not diminished in any way. Looking across the globe, the need for pro bono legal work does not decrease. Government funding for legal assistance is always a challenge, and the situation is worse in periods of economic downturn. Conflict, migration, natural disasters and socio-economic deprivation all give rise to legal needs and pro bono may be the only solution for many.

It is essential to keep reminding lawyers throughout their careers that pro bono work is a moral duty, a civic duty, a way to give back to communities and fight injustice and champion the rights of those who cannot on their own. In many parts of the world, law firms and in-house lawyers make time for carrying out pro bono matters, and a challenge is to amplify this for greater impact.

So how does or should pro bono fit with ESG? The Panel considered that law firms may consider their pro bono work to be a key element in their ESG strategies. Pro bono, as a category, could be said to fit into the wide category of ‘S’ of any law firm’s ESG profile, and some types of pro bono work might also fit into the ‘E’ or the ‘G’. Clients may be asking about a firm’s overall commitment to pro bono work already, but if they are not, they likely will. Some ‘big law’ firms have been reporting on their pro bono work for years, whether as a self-standing matter, or as part of their global citizenship or corporate social responsibility obligations. All law firms focusing on their ESG strategy should also focus on how to maximise their pro bono work as part of that strategy.

The panel discussed the view that while the focus on ESG in general has real benefits for pro bono legal work, there are risks in conflating pro bono with ESG.^[4] The two are not the same. Pro bono work is much wider than pure ESG-topic related work, and ESG work may not be pro bono. The concern arises from how law firms might organise their pro bono practice or pro bono work. If a pro bono practice is re-thought of or re-labelled as an ESG practice, or pro bono teams become ESG teams, or pro bono-dedicated lawyers become ESG lawyers, the type of pro bono work a firm does may shift, and the priority a firm gives to certain types of pro bono work may change.

In essence, the focus of the firm could move away from areas of crucial need: from access to justice matters, law clinics, litigation which may be resource intense and unpredictable and lengthy. The priority may instead become pro bono which fosters the ESG work done by a firm. That work may be entirely justifiable and pro bono, for example assisting in the setting up or running of non-governmental organisations (NGOs) working for environmental or societal ends or supporting these organisations or other international organisations with research on their projects. However, if the focus or indeed the only pro bono work done by a firm becomes matters which substantively could be valuable for the ESG practice (in bolstering their ESG submissions with additional ESG related matters and generally helping to bring in billable ESG clients), then the ethos of pro bono is fundamentally undermined and lawyers are not meeting their obligations to society to promote fairness and equality before the law. Furthermore, if lawyers in pro bono practices doing 100 per cent pro bono work are re-purposed as ESG lawyers and involved in billable ESG work in addition to their pro bono work, the risk to access to justice work is greater still.

The panel and the discussion from attendees focused on specific examples in jurisdictions across the globe of how firms are achieving impactful pro bono work and how some firms are already seeing this through an ESG lens as part of their ESG strategies, and how other firms tend to separate the two areas. There was agreement that the profession should guard against any unforeseen consequence of the current attention fixated on ESG and take care to prevent any shift in the centre of gravity of pro bono work, away from access to justice cases, where the essential need for law firms to contribute time and energy and expertise remains.

Conclusion

In conclusion, lawyers have been doing pro bono work for centuries. ESG has been around for a few decades. For those law firms beginning to concentrate on their own ESG strategies, pro bono work should be a key component of these strategies. As the focus on ESG progresses and matures, the legal profession must ensure that this is positive for pro bono work as a whole and does not detract from a lawyer’s fundamental obligation to work to achieve access to justice for all in need.

Click here to watch a recording of the session.