I had the pleasure of attending an amazing and informative session at the recent PSMG summit in London titled 'Embedding the E Of ESG'.  The session was run and hosted by Praveen Gopalan a sustainability and climate change expert who has recently joined the law space with HSF but who has the themes and research of the ESG movement coursing through his veins from his time studying, research roles and more recently, the BBC.  Not many hands went up in the room when he initially asked who considered themselves experts in the environment part of ESG and so he unpacked it in laypersons terms.  Here are a few key takeaways from a layman himself:

The environment as a topic has been pushed further up firms' agendas in recent years due to the following main reasons:

Internal Reasons: Employees are demanding more in the way of knowledge and education but are also pushing the agenda with firms.  This can impact retention and recruitment and can often lead to greater operational benefits.  Many firms have also latched onto the idea of potential new revenue and BD opportunities.

External Reasons: Disclosures are requested in annual reports.  Clients are asking for disclosure and often pushing for science-based targets such as reducing carbon footprints.  People, in general, are also driving change and holding firms accountable and firms are having to navigate the greenwashing trap.

Existential Reasons: There is a real moral reason and sense to drive change and this is reflected in the World Economic Forums Top Long-Term risks.  Environmental risks account for 5 of the top 10 as seen below.

Praveen suggested there were some reasonably quick wins in terms of how professional services firms can start addressing their own environmental impact.  In short:

• Look and check any renewable agreements.
• Set realistic goals and look at each area specifically.   A good example is the subject of travel whereby now zoom could technically replace a train ride or flight, leading to lower carbon emissions OR and software to filter travel by carbon emissions is available
• How are you educating your own business- can laptops and mobiles be given a second life in the community.
• Make sure internal and external communications are correct.
• With any targets or goals, make sure they are measurable.

He also encouraged everyone to look at their Scope Emissions as they might not be as straightforward as first thought.

Scope 1: Emissions being directly produced by operations that are owned or controlled by your firm

Scope 2: Indirect emissions from purchased heating, electricity, or cooling consumed by your firm

Scope 3: All indirect emissions that occur in your value/supply chain both upstream and downstream

Even more interestingly from this, Praveen pointed out that over 90% of the emissions can come from scope 3.  For many professional service firms, this means the first port of call is auditing and reviewing their current suppliers.  Time to make a change.