The Taylor Root team recently sponsored and attended the Corporate Counsel & Compliance Exchange and experienced a great panel discussion on ‘A practical look at ESG – the contractual nuts and bolts’.
Claire Roberts – General Counsel, Hitachi Energy
Anita Adam – General Counsel, Molson Coors Beverage Company
Anders Meex Hvashovd – Chief Compliance Officer, Seadrill
Tania A. – Director of Commercial Contracts, Curtiss-Wright Corporation
The key takeaways:
- One-size doesn’t necessarily fit all. Consider what is the subject matter in the contract that you want covered by ESG
- Think about fact-based questions you can ask suppliers to determine if they meet your ESG requirements, as opposed to asking them outright if they are in breach of certain regulations / standards
- Consider what is expected from your suppliers and how can they meet those expectations? At what stage do you conclude that you’ve reached that provision? Is it via KPIs or ‘best endevours’? Clarify these elements before contracts are signed
- There is still no universal measure of ESG metrics or standards so create a ‘Recipe Book’ to reference and measure ESG improvement
- A great (free!) resource for in-house lawyers is The [Chancery Lane] Project which provides ESG clauses and playbooks for drafting contracts; https://lnkd.in/eRmqEHhp
- ESG isn’t just a legal issue. Involve the business – from HR to supply chain – to get buy-in and support. For example encourage Supply Chain to do the ESG audit
If you would like to discuss the topics from the discussion, the legal, risk and compliance market or your hiring needs, please do not hesitate to contact Sarah Ingwersen or a member of the team.