Meet our ESG team: Rachel Barrett, Raza Naeem and David Ballegeer

The Linklaters multidisciplinary ESG team has deep experience advising clients across a wide range of sectors and contexts on the full spectrum of environmental, social and governance issues. In this regular series, we hear from members of the team about their ESG experience, their career journey and their views on the evolving ESG landscape.

In an age of apparently ceaseless activism, one in which a globally agreed target of Net Zero carbon emissions by 2050 already looms uncomfortably near

and a majority of General Counsel around the world place Environmental, Societal and Governance (ESG) issues at the top of their priority list, it can come as a mild shock to realise how recent the rush to understand and implement ESG really is.

The concept of ESG was only given a name in the 2000s. By 2018, ESG investing was already estimated to account for over $20 trillion or around a quarter of all professionally managed assets around the world [Source: Forbes]. However, the global regulatory framework needed to persuade financial institutions and corporate entities that it would be not only morally right but commercially and legally imperative to integrate ESG at every level of their business did not yet exist. Some were still dragging their feet. Equally pertinently, few global law firms yet had the specific expertise needed to pilot their clients through such a complex series of requirements, even if elements of ESG had formed part of various streams of their work for a number of years.

One clear exception was Linklaters. 

Much of the credit for the firm’s competitive advantage in all-round ESG expertise can be attributed to Vanessa Havard-Williams, recently retired from the partnership at the firm, whose top-flight practice in environment law was the bedrock on which she built a personal reputation for expertise across the spectrum of ESG advice, which filtered through her practice team and across the firm as a whole.

“Vanessa’s influence, I sense, will never fully leave us,” Rachel Barrett says. 

Rachel, a long-time colleague and friend of Vanessa’s in Linklaters’ environment and climate change team, is also one of her successors as the head of the firm’s ESG group, which was formally established a number of years ago. “She was brave enough to get involved in a grey zone of law – ESG is still far from clear and can have a different emphasis depending on the country or sector you’re talking about – which is not always a comfortable place to be. Vanessa had the skills and courage to do that and she instilled these into many of us around the firm.”

The ‘E’ of ESG was an obvious starting point for the Linklaters focusthe trusted global advisor for ESG.

; climate change and the imminent requirement to transition to clean energy were major preoccupations for clients and stakeholders of all types in the commercial world. However, Linklaters’ ESG pre-eminence is based, among other things, on its knowledge of the relevant issues that affect all industries, practice areas and the regulatory direction of travel across jurisdictions. The integration of these various strands of expertise has been critical to the firm’s position as

In the area of sustainable finance, Linklaters’ ESG offering pre-dates most of its rivals.

“Asset managers were among the first to start taking ESG issues seriously but the approach tended to be something of a mish-mash,” observes Raza Naeem, who chairs the internal Linklaters’ global ESG working group and has a wide-ranging financial regulatory practice in which ESG plays a substantial part. “Back in 2019 we began to think about a discrete ESG-related financial regulatory practice and it has boomed in the years since then. As regulators and governments have come up with more and different rules, every company and financial institution has seen that it is in their commercial interests to be more compliant with them. Most take this extremely seriously and the sophistication of the advice that they seek from us has risen exponentially.”

Brussels-based capital markets partner David Ballegeer is a classic example of a Linklaters lawyer whose practice has taken on an ESG focus.

“Before 2020, I would say that around 20% of my workload involved green-related finance transactions,” he estimates. “The global pandemic was the trigger for something different. I had the time to think about how ESG was growing in importance and what that was likely to mean for my area of practice and for the firm as a whole. I could see that the ESG component had the potential to reach as high a proportion as 80% of my practice and in the years since 2020 that is exactly what has happened. If you want to be a top-notch lawyer today you have to embed at least the basics of ESG into your practice.”

Educating the widest possible cross-section of the firm in ESG and its meaning for each respective practice has been central to Linklaters’ approach.

“ESG is something we do as our day job, which makes us a rarity,” Rachel notes. “Some time ago, Vanessa and I, together with some clever people at Oxford University, designed an ESG accelerator programme that would allow our other lawyers to work out, in mixed teams, how to integrate ESG into their own day to day practice. It was over-subscribed by about double and the effect has been to enable us to plug ESG into so many different teams, just as ESG is morphing into hard law across the globe. The pandemic actually helped us to put things together and connect the ESG dots in a more concrete way than we had previously.”

The shift from commitment to action on ESG has quickened as impending reporting and due diligence requirements, notably in the EU and the rest of Europe, become mandatory over the next two or three years.

“It is commercially unwise not to be green in any case,” says Raza. “It will become obligatory; meanwhile clients have to beware of issues such as green-washing – you cannot present yourself as green when you’re not and much more litigation will undoubtedly be on the way as a result of ESG-related issues, particularly in climate and supply chain cases.”

Clients may have a much better idea than ever today about what is required of them but uncertainty in this field is a long way from being completely dispelled.

Linklaters’ ESG leaders are not unsympathetic: “It’s still the case that a sensible definition of what green actually means is not fool-proof and in any case differs from sector to sector and across jurisdictions,” says Raza. “This is a highly complex field,” David adds. “It’s tough to collate the three separate components of ESG into a single defined space and nearly impossible to reconcile issues such as child labour with CO2 reduction, for example. Clients need help with risk management and they want to know the likely future direction of travel.”

“No-one should make the mistake of treating ESG as a one-size-fits-all concept,” Rachel notes.

“There are different paces of development, different views and events change those views – look at geopolitical events in the last year if you doubt that. The general trend will continue to be forwards in ESG, however. Net Zero by 2050 can be an easy target to leave to the next generation and there is still a lot of scepticism about people’s commitment to it but these are existential issues for many stakeholders and clients.”

“We are past the point of being good citizens now,” David says. but that makes adopting ESG all the more important. Certainly in my area, if you don’t, mainstream finance will drop you so the imperative is not just a moral one. As we always tell our clients – they must master their data when disclosure obligations are so much greater.”

“In some ways, we are already too late for the intermediary milestones of 2030

It is reassuring to know that optimism is not in short supply at Linklaters, both in terms of the firm’s continuing strength in depth on ESG matters and on the progress of ESG across the commercial spectrum.

“For the firm, as long as we continue to upskill our people from the ESG perspective and can say we have that expertise everywhere, we shall be in good shape,” says Raza. “I’m definitely looking ahead with optimism,” Rachel concludes. “ESG is a multi-faceted approach to a low carbon future and behind the scenes we see genuine efforts to ensure the transition to greener energy, social responsibility and better governance. We’re not there on everything yet but it’s so much better than it used to be.”

This article was written for the Linklaters Alumni Newsletter by James Fairweather, Lexicon, June 2023.