By GAIL Africa, Stories Evolved, Puxley ESG and Cambridge Institute for Sustainability Leadership (CISL)

This post summarises the discussions from a 26 June 2024 webinar hosted by GAIL Africa, the Cambridge Institute for Sustainability Leadership, Stories Evolved, and Puxley ESG.

The focus was on how African lawyers navigate the complex landscape of protecting client interests and achieving a just transition while managing evolving ESG and sustainability-related regulatory expectations from the Global North amidst growing environmental and social risks.

Overall Discussion Outcome

Law and lawyers have significant influence and the ability to shape the legal framework, which is a powerful social force essential for achieving a just transition.

Lawyers are at the forefront of navigating the complex interplay between business interests, global regulatory expectations, and sustainability. Their role is crucial in driving legal and business practices that are both sustainable and beneficial for Africa. Continued collaboration, proactive legal frameworks, substantive advice, effective legal training, and upskilling are essential for a just transition.

Key Discussion Insights

1. Leadership and Influence

Lawyers must lead in creating legal solutions that address client interests and achieve a just transition.

2. Embracing Complexity

● As trusted advisors, lawyers must integrate their legal knowledge with an understanding of broader business, economic, environmental, and social contexts to provide comprehensive, fit-for-purpose advice that mitigates risk and identifies opportunities.
● Lawyers are crucial in navigating legal grey areas and helping clients understand and meet diverse, developing and sometimes conflicting regulatory and reporting requirements.
● Compliance with international standards is often necessary for attracting investment despite the associated costs.

3. Broader skill set required

● Lawyers must have diverse skills and knowledge beyond traditional legal expertise to ensure their advice is not only legally correct but also enables clients to make responsible business decisions responsive to the requirements of investors, funders, workforce, clients, and broader society.
● It is essential to have a thorough knowledge of the client’s industry and business operations. They must integrate this business understanding with ethical and sustainability considerations to provide substantive advice that aligns with legal and ethical standards, avoiding superficial compliance, mitigating client risks and ensuring social license to operate within the relevant context. For example, addressing energy poverty and inequality while ensuring environmental protection is critical.
● Lawyers must understand the local market and international investor expectations to provide practical, tailored advice that balances compliance with global standards and local realities. This approach focuses on helping businesses remain legally compliant, competitive and attractive to foreign investment.

4. Proactivity

● Lawyers must be proactive enablers, not just legal advisors. This means anticipating clients’ needs and providing comprehensive legal advice that considers material social, ethical, and sustainability factors. By offering a fuller picture, lawyers help clients make informed commercial decisions that benefit the business’s long-term interests.
● Lawyers should facilitate the implementation of governance frameworks to manage evolving regulations and social expectations, mitigate greenwashing risks, and enable the business to compete and differentiate itself credibly.
● Lawyers play a crucial role in advising on new, often untested and evolving regulations, blending international precedent with local context to provide practical solutions to clients.

5. Advocacy

● Lawyers bridge the gap between commercial interests and government policies. They must engage with regulators to understand their objectives and the legal landscape, helping to implement practical, long-term solutions that balance regulator objectives with business interests and the need for access to capital to finance the just transition.
● Lawyers must amplify African voices in global discourse to help shape global and local regulations that promote sustainability and good governance without compromising access to critical markets or causing unintentional harm to African economies that have the effect of undermining the just transition.

6. Lawyers need support and training to execute their expanded mandate
   
7. Future conversations and engagement

● Collaboration and Knowledge Sharing, such as that enabled by this GAIL, CISL, Stories Evolved, and Puxley ESG event, are crucial to helping lawyers fulfil their changing mandates.
● There is a need for ongoing conversations about the evolving role of law and lawyers in sustainability to help lawyers and their clients address these challenges effectively.

Questions to Explore

1. Given the context and complexities of modern business and legal practice, what are a fit-for-purpose lawyer’s roles, responsibilities and duties?
2. How do lawyers balance their professional responsibilities with personal values, especially when advising on projects with negative environmental or social impacts?
3. What support do lawyers and the legal profession more broadly require to deliver on their changing role and expanded mandate? What role should educational institutions, law societies and law firms play in equipping lawyers with the necessary skills and knowledge to discharge their extended mandate?
4. What role should law societies play in clarifying lawyer’s professional obligations concerning ESG and sustainability?
5. How do lawyers enable clients to move beyond legal compliance to responsible business practices, integrate sustainability into core decision-making, and ensure a continued social license to operate?

Next steps

Engage in Leadership Workshops

Enhance your firm’s leadership capabilities through workshops focused on sustainability in the legal sector.

Join the Research Initiative:

Participate in the groundbreaking research by CISL, Stories Evolved, and Puxley ESG to understand the role of law and lawyers in achieving a just transition and overcoming barriers to fit-for-purpose legal advice.

For more information and to get involved in these initiatives, please contact:
Aimée Girdwood: aimee.girdwood@storiesevolved.com
Victoria Puxley: victoria@puxleyesg.com

Acknowledgements

We thank the Global Alliance of Impact Lawyers (GAIL), GAIL Africa and each panellist for their participation, candour and insights. These contributions are invaluable to developing insights into the evolving role of lawyers in facilitating the just transition.

Panellists:

NanaAma Botchway: Managing Partner – N. Dowuona and Company
Stefanie Busch: Senior Associate – ENS
Christina Nduba-Banja: Partner – Bowmans
Victoria Puxley: Founder – Puxley ESG
Jesse Zigmund: General Counsel – M-KOPA

The event hosted by the Global Alliance of Impact Lawyers (GAIL) and focused on the critical role of African impact lawyers in navigating business interests, global regulations, and climate challenges.

The Role of Lawyers in Leadership

Professor Richard Calland highlighted the role of the professional trusted advisor as a leader, someone who can influence change through their professional expertise and their approach. He suggested that the role of lawyers has been somewhat underplayed so far, particularly as management consultants.

Current Moment in History

CISL convened a global summit on leadership in February titled “Leadership in the Age of Turbulence.” They concluded that the core challenge explored was the preservation of human civilisation. This is the leadership challenge of our times. Addressing this scale and complexity of challenge will take everything, everywhere, all at once. Progress will be messy and unsatisfactory, and leaders need to grow comfortable with this fact. This requires intellectual honesty, integrity, and humility to recognise that the world is complex and that progress will not be easy, but this is no excuse for inaction.

Africa’s Crossroads

Africa stands at a crossroads with an extraordinary opportunity in the energy transition, specifically regarding critical minerals, carbon sinks, green hydrogen, and green industrialisation. The United Nations Economic Commission for Africa (UNECA) released a report in March on just and sustainable transition finance, emphasising the need for innovative approaches to mobilise massive amounts of public and private resources.

Dr. Gary Kendall, one of our fellows, puts it simply: we need to transition from an extractive, exploitative, exclusive, and excessive economic model to one that is regenerative, reciprocal, representative, and restrained.

This webinar navigates the tensions lawyers face in balancing business interests with the evolving regulatory demands of the global North and the impacts of climate change and biodiversity loss with social issues in Africa. 

Panel Discussion

1. Jesse Zigmund (M-Kopa):

   – Discussed innovative business models addressing social problems, such as off-grid solar products and fintech solutions.

   – Highlighted the legal team’s role in navigating regulatory grey areas responsibly.

2. Victoria Puxley (Puxley ESG):

   – Addressed the impact of EU regulations (CSRD, EUD, CS3D) on Kenyan businesses.

   – Emphasised the need for African lawyers to protect business interests and advocate for local voices in global regulatory discussions.

3. Christina Nduba-Banja (Bowmans):

   – Described the efforts of African countries to align regulations with global standards.

   – Mentioned challenges in implementing modern regulations due to sudden transitions and local context mismatches.

4. Stefanie Busch (ENS Namibia)

   – Described the dilemma Namibia faces as one of the most unequal societies. 

   – Discussed the contradiction that exists in Namibia due to it being recognised as a top green hydrogen producer in 2020 and then in 2022, significant oil finds being announced.

5. NanaAma Botchway (n. dowuona & company):

   – Shared her perspective on the role of professional lawyers in the green transition discussing the challenges that arise in the lack of clarity of the regulations and local content regulation.

   – Discussed the importance of finding solutions that benefit both the client and Africa.

Key Points Discussed

• Enhanced Due Diligence and Compliance: Businesses are proactively aligning with international standards to mitigate legal risks.
• Integration of ESG Criteria: ESG considerations are becoming central to business strategies, driven by regulatory requirements and investor expectations.
• Investment in Green Technologies: Businesses are investing in sustainable practices and technologies to reduce their carbon footprint and open new growth opportunities.
• Focus on Social License to Operate: Engaging with local communities and stakeholders is crucial for maintaining a responsible business image.
• Risk Management and Scenario Planning: Companies are adopting comprehensive risk management strategies to anticipate and address climate and regulatory changes.
• Collaborative Approaches and Partnerships: Forming partnerships across sectors is essential to address complex sustainability challenges.
• Educating and Empowering Internal Stakeholders: Building internal capacity through training and creating dedicated sustainability roles is key for embedding ESG in corporate culture.

Audience Interaction and Further Discussion

• Highlighted the need for legal education to incorporate ESG topics from university to ongoing professional development.
• Emphasised practical experiences like internships and mentorship programs to provide real-world insights into ESG issues.
• Discussed strategies to persuade sceptical clients about the importance of ESG by demonstrating tangible benefits and regulatory trends.
• Stressed the importance of storytelling in making a compelling case for sustainable practices.

Conclusion

• Final advice for lawyers: start integrating ESG into decision-making processes, stay informed, embrace collaboration, and focus on building client relationships.
• Recognised the significant yet underappreciated role of lawyers in promoting sustainability and shaping global regulations.
• Called for continued collaboration among impact lawyers to leverage their influence in driving sustainable business practices.