How to avoid the pitfalls of 'greenwashing' claims (First published in Managing for Success)
9th July 2024
First published in the Law Society Leadership and Management Section as 'Green Light’.
More and more clients are asking law firms about their environmental credentials, and looking for evidence that claims are more than just ‘greenwashing’. It is easy to put a logo on your website and to ask a copywriter to draft a page for a website about a commitment to sustainability, but do those commitments translate into measurable objectives, sustained action, and tangible results?
It has been 28 years since the first Conference of the Parties (COP) was held in Berlin in 1995, and environmental issues have been very slow to rise up the boardroom agenda in law firms. At the start of 2024, there were just 18 B Corp certified law firms in the UK and only 68 worldwide. (In contrast, there are 228 marketing B Corps in the UK and 719 worldwide).
‘From my own experience as a small business owner, I know that it is much harder to achieve environmental improvements than I had anticipated,’ says Sue Bramall a member of the Law Society Leadership and Management Section. Keen to learn from some law firms who have been leading the way in ESG (environmental, social and governance) strategies, Sue spoke to Martin Bunch, Managing Partner of Bates Wells and Natalie Cooksey, Data Privacy Counsel and member of the Risk and Compliance team at Travers Smith.
Bates Wells was the first UK law firm to achieve B Corp certification in 2015, and Travers Smith won the award for ‘ESG Initiative of the Year’ at the British Legal Awards in 2022.
What exactly is ‘greenwashing’?
The expression ‘greenwashing’ was coined back in the 1980s in reference to the suggestion to hotel guests that they might reuse their towels each day in order to save the planet; when in reality the policy was encouraged by hotel management because it was effective in reducing laundry costs. To see if a hotel is serious about the environment, just look at how many small plastic containers you can spot in the bathroom!
Nowadays greenwashing also covers false claims and symbolic gestures. For example, in 2020 Apple stopped including earphones and chargers with its iPhone 12, saying it was concerned about waste. Meanwhile, environmentalists point out that the whole mobile phone sector operates on a strategy of planned obsolescence whereby rare minerals (from conflict zones) can end up in landfill.
Recent guidance from the Law Society on greenwashing
The Law Society has published its guidance on the impact of climate change on solicitors (following on from its Climate Change Resolution in 2021) and it includes warnings on the perils of greenwashing.
In particular, marketing partners, committees and staff need to be aware of section 1.5 (Greenwashing) and 1.6 (Communicating your commitment):
1.5. Greenwashing
Marketing, pitch, and other materials that communicate your organisation’s approach to climate change should not mischaracterise or overstate your organisation’s targets, or progress made against them.
This has the potential to leave your organisation open to accusations of 'greenwashing' and may lead to breaches of the Competition and Markets Authority’s guidance on environmental claims (Green Claims Code) and/or the SRA’s Standards and Regulations.
For example, the term 'sustainable' is widely taken to mean “meeting the needs of the present without compromising the ability of future generations to meet their own needs” (EU Brundtland Report, 1987; as quoted in the Charity Commission’s definition of sustainable development).
If your law firm describes itself as sustainable, or providing sustainable legal services, or makes similar claims relating to its response to climate change, you need to consider whether those claims can stand up to external, objective scrutiny.
Setting standards by reference to accepted scientific methodologies and measuring impacts using those methodologies is an established way of demonstrating this.
The Green Claims Code provides guidance for businesses on existing obligations under consumer protection law when making environmental claims in the UK. See the relevant heading ‘Claims must be true and accurate’.
1.6. Communicating your commitment
As with any other public statements made by you and your organisation, you should be mindful that your communications are accurate and not misleading to ensure any such communications cannot give rise to claims of misrepresentation or greenwashing.
It is also important that you have consideration of the SRA’s regulatory requirements (see paragraph 1.4 of the SRA Code of Conduct for Firms and paragraph 8.8 of the SRA Code of Conduct for Solicitors).
‘Don’t promise what you cannot deliver’ is a fundamental principle of successful marketing and business development, so it is important to recognise potential greenwashing and ensure that any claims are backed up by facts and actions.
While law firms might seem to have a small environmental footprint compared to other business sectors, lawyers and support teams are big users of tech devices. Similarly, while firms may pat themselves on the back for no longer sending out printed paper newsletters, how does this compare to the invisible energy usage and global warming issues arising from the use of data centres for cloud computing?
Leading from the front
Martin, Managing Partner at Bates Wells emphasised that, ‘Nowadays it is easy to be found out if you are not authentic. Because we wear our environmental and social commitments on our sleeves, we attract people who understand the issues and want to see change. The flip side of this is that employees know what happens inside a firm, and you risk losing their trust if you are not delivering on your promises.’
Bates Wells drives its environmental strategy via its Climate Board which it established in 2019 to formally recognise the climate and biodiversity emergency. As well as addressing our internal environmental impact, the group works with internal stakeholders to have a positive impact on the legal profession generally and the advice we give clients. It reports directly to both the Management Board and internal stakeholders. ‘Our belief that we urgently need change in the sector, both from within and in using our experience to guide our clients, is a fundamental part of everyone’s role in the firm’, says Martin.
At Travers Smith, factoring environmental and diversity considerations into strategic decision-making has long been a feature of how the business is run. The firm's Environment Committee, whose members include a diverse spread of people within the firm across a range of different departments, keeps under constant review the aspects of the firm's activities that are having the greatest negative impact on the environment.
Influencing suppliers
Natalie explained that, ‘Whilst such internal initiatives are beneficial, as the imperative for change becomes more urgent it is also necessary for firms to consider how they can influence others in their value chain. From an upstream perspective, Travers Smith has taken a number of steps to seek to influence the behaviour of its suppliers. In 2020, we launched a Supplier Code of Conduct, detailing our expectations in terms of how suppliers should conduct themselves as regards ESG issues. Last year, we began the process of asking our key suppliers to complete an EcoVadis sustainability assessment, which will enable us to gain a better insight into how sustainable our supply chain really is.’
Martin explains that at Bates Wells, ‘The role of supply chain in our business is critical. We have always favoured B Corps and Social Enterprises in our supply chain and since 2019 we have actively screened our suppliers on their social and environmental impacts. We have a framework of purpose-driven suppliers that work across all areas of our business. We have also taken the time to speak to others about how they might achieve B Corp certification both within the sector and more broadly within the business community.’
He adds ‘We look at B Corp as a fantastic shorthand for business that wants to be better. We know that by using like-minded business throughout our own supply chain, we are continuing our drive to put people and planet first. Having a third-party certification for this also ensures that we’re not encouraging greenwashing ourselves. We trust the process.’
Considering clients
In 2023, Bates Wells launched its Sustainability & Responsibility Pledge. ‘This is our commitment to working with our existing clients to guide them towards better ways of getting to the same answer, considering the ESG implications of the work that we are doing with them and looking for innovative ways to mitigate any potential negative impacts. It also steers us in regard to the new clients that we will take on. The Pledge is backed up with our internal Reputational Risk Group, which is convened to discuss taking on a client that falls below our own standards and values. We will turn away clients that do not fit with how we want to do business,’ adds Martin.
‘As a responsible business, it is increasingly important to us that our clients are taking appropriate steps to measure and mitigate their ESG impacts,’ continued Natalie. ‘In 2022 the firm introduced a new client take on process, which involves carrying out early screening on potential new clients to identify any potential ESG concerns. This initiative was led by senior management, who were keen that we should be able to make informed decisions as to which clients and projects the firm should take on, having reflected appropriately on the outcome of the screening.’
‘Taking into account our own stated values on ESG, the firm acknowledges that there will be times when it is appropriate to turn down instructions on ESG-related grounds. In circumstances where we do accept instructions, we are clear that our clients expect us to be able to engage with them on ESG topics.’
With this in mind, Travers Smith has also devised and delivered, in collaboration with faculty members from the Oxford Saïd Business School, an internal ESG and Sustainable Finance Academy, with the aim of embedding a deeper understanding across the firm of how ESG and sustainability issues affect clients' businesses.
Acknowledging the difficulties
‘I found that my own quest to lower my environmental footprint encountered several obstacles and issues that have proven tricky to deal with,’ said Sue. ‘Comparing notes with law firm partners, I know these issues are not uncommon and it is hard to find an easy scientific answer in some cases.’ For example:
Property upgrades – easier said than done.
In 2018, I purchased a small upstairs office in a Georgian building and, as it needed gutting, I was very keen (and excited even) about the opportunity to ensure it was environmentally friendly. I secured a grant, and a consultant came and advised on how to improve the energy efficiency of the offices. But achieving a significant improvement in the EPC rating was more difficult because:
- some issues were entirely outside my control and the responsibility of the freeholder – such as the roofing area (which was insulated, but not to the required standard) and the underfloor cavity which wasn’t insulated at all; and
- some things couldn’t be done because the building is in a heritage conservation zone, such as double glazing – and the windows which were approved by the heritage officer were so expensive that they didn’t leave any budget for secondary glazing at the time.
Does battery consumption outweigh the benefit of TRVs?
A new boiler was installed with zone controls to allow us to ensure rooms were only heated when they were being used but, while this works well, the thermostatic radiator valve (TRV) controls consume an astonishing number of batteries.
Is my increased lithium use doing more harm than good? Does the energy I am saving by controlling the radiators more precisely outweigh the environmental harms caused by the increased use of batteries?
Are data centres melting glaciers?
One of the issues that I would really like to have better information on is the impact of our use of the internet. According to the International Energy Association data centres are responsible for nearly 1 per cent of energy-related global greenhouse gas emissions annually – with cooling accounting for 40 per cent of the electricity usage.
Most law firms now work ‘in the cloud’ and most marketing is now digital. When sending emails and sharing posts on social media, we may not see it or feel it, but we are using energy in these data centres that are far away, out of sight and out of mind.
But that doesn’t mean they do not have an environmental impact. My son and my niece both work in the ski industry which means that we tend to get regular information about snowfall (or lack of it) and the shrinkage of glaciers. Neither the warming caused by data centres, or the reduction in glaciers, are front of mind, but we shouldn’t ignore the connection if we are making environmental claims.
Tree planting – how many? What type?
I love gardening and live in the countryside so I thought this might be an easier win. I tried to look at how much carbon the business used, and how many trees to plant to offset this, but it was all incredibly complicated as different trees are more or less effective at carbon capture depending on whether or not they are evergreen or deciduous, fast or slow growing. In the end, I just decided to get on with planting more trees and hedging, and put the shredded paper in the compost heap, and hope it all contributes.
I soon concluded that I was lacking the scientific skills to make meaningful calculations of my impact, and as a very small business I was not in a position to invest in specialist consultants for every calculation.
Call on experts
In contrast, Bates Wells has invested in expert advice to help them with calculations and benchmarking. Each year they publish their Impact Report with key performance indicators, such as carbon emissions (reduced by 80 per cent between 2012 and 2022); waste to landfill (zero in 2022, as everything is recycled); paper consumption (89 per cent less than in 2016).
Open to ideas from all corners of the firm, Martin finds the facilities management team to be particularly helpful in coming forward with pragmatic suggestions.
Asked what advice Martin would offer to other law firm leaders, he stressed the need to avoid gimmicks, ‘We evaluate the ideas carefully, working with charities and partners who understand the science. Not every idea is agreed to, and the need to measure (and publish) the impact helps to keep you focused and honest.
Avoiding greenwashing or ‘greenhushing’
Asking Natalie how Travers Smith avoids the perils of greenwashing, she explained, ‘Whilst keen to share our ESG successes externally, we are conscious that progress needs to be measured and evidenced correctly, through solid data, to avoid the risk of greenwashing. Our Sustainability Manager has been meticulous in ensuring that primary sources of data are used in our reporting wherever possible (and, where this is not possible, that this is explained). Like many firms, our processes for collecting relevant data have evolved at pace as we continually improve, and we recognise that not all of these processes are fully mature. However, we ensure that we only use data that we are confident in and which originates from a reputable source. We also favour the supplier-specific calculation method for calculating emissions over the use of an annual spend-based method, on the basis that this latter method involves secondary data.’
Natalie emphasises that, ‘To avoid greenwashing, firms need to be transparent and honest in terms of how they present data and should clearly detail any limitations in the way that information has been collected. This is particularly important for scope 3 emissions, whereby the reporting requirements are not prescriptive. Travers Smith has just begun the process of working with suppliers to collect better data on scope 3 emissions; we acknowledge that it will be a number of years before we are able to present a full picture.’
‘Although it is not always possible to have a perfect story, our view is that as long as firms set a baseline and, from there, present the factual details of any improvements they may have achieved, the risk of facing a greenwashing claim can be effectively mitigated. In addition, having accurate primary data and a sound methodology for quantifying scope 3 emissions can help to avoid "greenhushing" and ensures that firms who have made genuine progress feel confident in sharing their successes.’
Martin sums it up by saying, ‘At the end of the day, if we can stand up and see that we have reduced our emissions, we have incentivised our people to be better, and had a positive social and environmental impact on the sector, then we can feel proud that what we’re doing is having a positive impact. We’re very happy to discuss this externally, and clients ask us how they can do similar things. This should be the simplest test for any law firm.’
‘If your ESG or CSR initiatives are being run to make you look better, that is a problem. I answer to all of the employees of Bates Wells and I can promise you that all hell would break lose if they felt we were not legitimate in what we say and what we do.’
Spare a thought for the marketing team
It is a cliché to say that ‘it is a journey’ but the science is complex, and best practice is emerging slowly. A strategy of continuous learning and improvement, solid facts and data, and regular updates will go a long way to avoiding the risk of an accusation of greenwashing.
So, spare a thought for the members of your marketing team - don’t just ask them to draft a web page or a section of a pitch document about your environmental credentials without any data or support.
See the full report from the Law Society:
https://www.lawsociety.org.uk/topics/climate-change/impact-of-climate-change-on-solicitors
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