LawTalk pulls up a green seat next to three thought leaders and first-mover firms making a positivedifference in how the profession tackles climatechange issues in Aotearoa New Zealand.
LawTalk pulls up a green seat next to three thought leaders and first-mover firms making a positive difference in how the profession tackles climate change issues in Aotearoa New Zealand.
Kate Wilson Butler, Wellington-based Director – Climate, Sustainability and ESG for Chapman Tripp; Natasha Garvan, Auckland-based partner for Bell Gully, and convenor of the Law Society’s Climate Change law reform subcommittee; and Holly Hill, Wellington-based partner, and Sustainability Leader for MinterEllisonRuddWatts (MERW) share their principles and best practices on climate change and sustainability, and where the greatest opportunities lie for the profession to make a difference.
Our changing legal landscape
With climate change litigation on the rise, New Zealand is already following international trends of climate litigation, targeting private companies and not solely on governments. The February release of MERW’s Litigation Forecast 20231 brings this topic into sharp focus.
“Climate change litigation, greenwashing, and the regulators’ current focus on business’ social license to operate (rather than simply legal compliance),” form the entry point for the MERW report. Furthermore, the report notes how “activists are increasingly turning to the courts to hold to account those perceived as directly or indirectly contributing to climate change.”
Chapman Tripp’s Kate Wilson Butler says “the upcoming Supreme Court decision on the appeal of Smith v Fonterra Co-Operative Group Ltd  NZCA 552 will be a defining moment in our legal history and set the course for future climate litigation.”
This also suggests climate litigation as an instrument of change to punish or protect. Moving forward, we will see a greater focus on using climate law as a lever for prevention through protection instead of being a punitive measure after the fact.
As the most contractual element of climate change issues, climate litigation is just one part of a dynamic and multi-faceted approach to climate change that firms are employing.
Wilson Butler and her climate colleagues at Chapman Tripp describe the firm’s integrated view of climate change and sustainability as being one that demonstrates the creation of value for clients, communities, people, and the environment by implementing global best practices in a local context. For Chapman Tripp, this includes helping clients navigate this new landscape in a way that respects a Te Ao Māori worldview. Global partnerships and alliances such as the ‘Net Zero Lawyers Alliance’, of which Chapman Tripp is the sole New Zealand member, enable access to global networks and emerging thought leaders. Offering net zero-aligned legal services helps provide advice and guidance to clients and evolving businesses responding to climate and ESG2 developments and creating value in response to these emerging risks and trends.
Bell Gully partner and environmental and resource management law specialist Natasha Garvan agrees that a holistic approach is key to tackling climate issues. Garvan considers New Zealand to be well-positioned in its acceptance and implementation of this approach, given our integrated thinking and consideration for a Te Ao Māori worldview alongside a western worldview.
Considering climate clauses – a new normal
MERW partner and Sustainability Leader Holly Hill says “normalising ESG and sustainable practices are key to effecting positive change, and this is consciously woven into every thread of work we do.”
One of the goals in MERW’s ‘Sustainability Strategy 2021-2025’ is to be certified as net zero carbon by 2025. “Alongside this is a commitment to helping create more sustainable futures for our people, clients and communities that focus on protecting the planet. This includes promoting the eradication of modern slavery, promoting a living wage and respecting Te Ao Māori and the world view of other indigenous communities – something that is becoming increasingly relevant for lawyers following the recent decision in Ellis v R  NZSC 115.
Hill urges the profession to consider the difference that could be made if every contract that we drafted has ESG and sustainability principles at its core.
This is at the heart of a first mover project MERW engaged in, ‘The Chancery Lane Project’ – a global movement by lawyers promoting climate-conscious drafting. Hill says such initiatives “allows the contractual facilitator to become the initiator and, in doing so, adopt a proactive approach to climate change.”
Climate-conscious drafting as a practice can extend into all types of contracts and across a wide range of clauses: commercial incentives, governance provisions and dispute resolution, to name but a few.
Hill says “this proactive approach has been exceptionally well-received by clients of the firm and demonstrates detailed thinking behind this critical issue. Presenting such opportunities increases accessibility to climate-related solutions and helps clients get a ‘win’ in this space. The more you adopt and promote these things, the more yesterday’s novelty can become today’s norm.”
Chapman Tripp’s Wilson Butler has seen an acceleration of change in the climate space over the past two to three years. She notes that “the last few years have been tough for many sectors – from the pandemic, to labour shortages, supply chain disruption, inflation, and most recently the impacts of extreme weather events, it has been easy for sustainability to be seen as a ‘nice to have’. What we’ve seen is that organisations who have embedded sustainability into their core strategy and business planning have fared better through these crises. Internationally, we see many leading companies taking this approach, converting climate action and ESG from a cost centre to a driver of value in the business by integrating it into core strategy and business planning. In New Zealand, climate-related financial disclosures have catalysed a real shift in the way companies are talking about and acting on climate change risk, with many seeing the mandated reporting as an opportunity to transform their business rather than simply a compliance exercise.”
Bell Gully’s Natasha Garvan says “elevated levels of awareness and commitment to environmental issues are being seen from clients. This is seen in annual reports of major companies where environmental reporting is a given for annual reporting and accorded equal effort to other areas of reporting.”
Data – the new tool in the climate toolbox
MERW’s Holly Hill says data insights are gaining in value as a sharp tool in the climate toolbox for litigation, financial reporting and project business cases. International trends show us that data analysis around ESG captures the pace of change, providing quantifiable evidence to the climate issues we are dealing with and a measurement tool for our greenhouse gas emissions obligations.”
Bell Gully’s Natasha Garvan explains that employing expert measurement agencies, such as Toitū, enables them to engage in a meaningful way with clients and the market. “We have a focus on improving and adapting to reduce our carbon footprint through our own efforts and our engagement with others through the supply chain.”
‘Walking the talk’
All three firms have taken a leadership position from within that brings together community, internal practices and external influence with clients. It is testament to this commitment that each firm has a senior partner or director charged with steering the firm’s sustainability initiatives and future direction.
Chapman Tripp says “sustainability, is a key aspect of Chapman Tripp’s community strategy, which forms a core part of the firm’s strategic plan. In particular, Chapman Tripp’s community strategy focusses on the firm, as a citizen of Aotearoa, making a difference in the communities and environment that it lives and works in. This includes giving back by contributing to our community, through pro bono work, being mindful of our environmental impact through working sustainably and being a responsible employer. The development, monitoring, co-ordination and execution of that strategy is spearheaded by Community Director Greer Fredricson and ensures that the firm is ‘walking the talk’.”
Wilson Butler says, “Chapman Tripp focusses on both our ‘handprint’, or impact we can create through clients – for example, through the Net Zero Lawyers Alliance we’ve committed to offering net-zero aligned legal services – as well as working on our own sustainability journey, including by reducing our own emissions.” Chapman Tripp’s main focus is on reducing, mitigating and managing emissions, however, an offsetting programme is commencing this year to offset unavoidable emissions.
Sustainability is a key strategic focus of the Chapman Tripp board. Furthermore, the firm’s operational priorities and progress on the sustainability strategy reported to the board by the Chief Executive Partner and Chief Operating Officer. This includes deliberately investing in the firm’s capacity and commitment to climate, sustainability and ESG in a way that (as the firm put it when Wilson Butler was appointed in late 2022) is “responding to market and client demands by increasing our capability to support our clients in ways that challenge the perceptions of a traditional law firm.”
MERW has laid the foundation for its sustainability effort with three key pillars:
Kia toitū te taiao (having a positive impact on the environment)
Kia toitū te tāngata (caring for people)
Kia toitū te tikanga (leading the normalisation of sustainability in business)
Hill explains that these pillars underpin and articulate the firm’s sustainability strategy for its people and clients. “Putting a robust sustainability strategy in place early has enabled MERW to front foot sustainability issues and the significant challenges that climate change offers in an area of rapid change.”
For Bell Gully, a sustainability committee ensures that green issues are reported on, considered and prioritised at a board level. Internally, Garvan points to a series of simple, sustainable practices as being the operating norm for the firm. This also includes a strong community focus. An example of this was the firm’s recent office move in Wellington, where chairs were refurbished, and surplus office furniture was recycled or donated in collaboration with Wellington City Council and other community organisations. Bell Gully also looks to its supplier contracts to build long-term partnerships with suppliers who demonstrate sound environmental values and practices. “An example is our technology leasing through specialist supplier, Quadrent, with an initiative to reduce e-waste entering landfills and provide refurbished digital technology to communities around New Zealand.”
The role of law reform
Garvan, who is also the convenor of the Law Society’s law reform environmental subcommittee for climate change says, “reform can either hamper or speed up the process around critical issues such as managed retreat. To accommodate the inevitabilities of climate change such as relocation of threatened communities we need a legal framework to enable this to happen in an orderly and staged manner.” Garvan sees ‘managed retreat’ as a real likelihood and says “as we have seen, New Zealand is in no way immune to the threats that will drive us towards managed retreat.” Looking to coastal inundation and flood risk areas, there will be a requirement for systemic change that accommodates realistic transition for at-risk communities. “Adaptation in this space is required at an individual and societal level.”
Garvan says it is imperative that we can apply climate levers that “create dynamic, adaptive pathways with trigger points to accommodate the varying stages that may or may not end with relocation but will have a well-thought-out plan in place before we get to a state of emergency. This may include tools such as climate leases.
“Without the luxury of time to address climate change issues, it is critical to have strong, bi-partisan political leadership. Climate change should not be the domain of one party, nor should it be a political football, as it affects everyone. My view is the nation has largely focused on using the law (the RMA) to enable or stop developments rather than using the law to incentivise outcomes that improve the status quo both economically and environmentally.”
Chapman Tripp’s Wilson Butler says “the legal profession operates within complex systems that are changing in response to climate change and broader ESG issues. Every actor has a role in managing the risk and realising the opportunities that arise from the transition, including lawyers.”
Capitalising the ‘S’ in ESG
MERW’s Holly Hill points to a concerted effort to elevate the ‘S’ in ESG, sagely posing the question, “What’s the point of saving the planet if there is no one is left to enjoy it?” This is demonstrated through the firm’s community investment programme which, sitting within the firm’s Sustainability Strategy, aligns with the United Nation’s Sustainable Development Goals (for example, reducing inequality, climate action and rule of law).
People and Culture
Through this, staff are empowered to discuss sustainability ideas through a staff-led committee. In doing so, a collective benefit is reaped by “harnessing the energy of the staff through responsibility and respect.”
It would be impossible to talk about a firm’s commitment to ESG without mentioning the words ‘Pro Bono.’ This aspect of work is one with the ability to make a positive impact by supporting climate causes. Firms each take different approaches to managing and implementing climate-related pro bono work. This ranges from positive, significant funding as a billable hours figure to allocated hours per senior lawyer or partner toward climate-related issues. Firms generally verify and assign climate-related pro bono work through a pro bono committee.
For MERW, the structure of this work includes pro bono and broader community investment work for key community partners, including championing climate-related clauses through The Chancery Lane Project, and supporting Community Law Centres and the Who Did You Help Today? Trust and its programmes designed to overcome the negative effects of poverty by creating positive pathways.
Bell Gully demonstrates their commitment to making a meaningful contribution to initiatives that support communities’ wellbeing through their pro bono and community programmes, which were formally established in 2009. The programme’s scope is unlimited in terms of the range of charitable sectors the firm supports, and includes providing secondees to three local community law centres and providing pro bono advice on conservation and environmental matters. Garvan cites examples of work with the Environmental Defence Society (EDS), New Zealand Coastal Trust and Project Crimson.
Bell Gully supported the NZ Coastal Trust (who worked with local stakeholders, mana whenua and the EDS) to facilitate the high-profile sale of New Chums Beach in Wainuioto Bay that brought the land into public ownership for the enjoyment of all New Zealanders. Work continues in this space toward applying a protective covenant for this land. Bell Gully had previously advised a ‘Givealittle’ crowdfunding campaign on the public purchase of Awaroa Beach in 2016.
Garvan counts Bell Gully’s current work with Project Crimson as having a direct relationship to climate change issues. Initially established to re-generate areas of New Zealand’s coastline with pōhutukwa, the Project Crimson Trust has grown to work with a broader collective to strengthen ecosystems and contribute to healthy and sustainable ecosystems throughout the country. Bell Gully is proud to be involved in Project Crimson’s flagship project, ‘Trees That Count,’ which developed a community marketplace that calculates carbon sequestration levels and provides a platform that enables corporate and private funders to invest in native tree plantings. Over time, this offsets the carbon emissions they are creating today.
Bell Gully’s work included designing a structure and investment vehicle for the development of a biodiversity benefit instrument for investment in the planting of native forests and the creation of new biodiversity in sensitive land areas.
“Contracting and advisory work in this area supports specific afforestation projects and contributes to organisations meeting with corporate social responsibility and ESG goals,” concludes Garvan.
For Chapman Tripp, pro bono legal work is part of the firm’s DNA and it has seen its pro bono practice in relation to climate and sustainability grow in recent years. The firm has been a long-standing partner of The Aotearoa Circle, and supports Toitū Tahua: the Centre for Sustainable Finance. In addition to supporting smaller, local environmentally focussed projects, the firm’s pro bono work has included legal opinions regarding directors’ duties in relation to climate-related risk, and an Investment Stewardship Code, launched in 2022. The firm is currently working on a new legal opinion for The Aotearoa Circle on directors’ duties in relation to nature-related financial risk, an emerging area globally.
Where to next?
Bell Gully’s Natasha Garvan “expects New Zealand to follow global trends of an increase in climate litigation and a greater range of claims. In addition to further claims by advocacy groups placing pressure on the government and industry, in the coming years, we expect to see investigations by regulators relating to corporate greenwashing and climate-related disclosures. The FMA3, which now has a mandate for the monitoring and enforcement of climate-related financial disclosures, has suggested that its focus in the preliminary stages of the new disclosures’ regime will be on failures to produce climate statements or where those statements are false or misleading.”
MinterEllisonRuddWatts Litigation Forecast. 09 February 2023