The corporate world has been discussing sustainability for years, and it is an increasingly integral part of business operations. In the coming years sustainability will permeate the strategy, business practices and value chains of companies, which are required to increase their efforts to mitigate their adverse environmental and human rights impacts.
'The regulatory framework of corporate sustainability is taking shape at a rapid pace, and companies are continuously faced with new requirements. Emphasising sustainability in marketing is no longer enough – instead, companies need to take concrete action on a strategic level. With this in mind, we are expanding our offering in corporate sustainability in order to better serve our clients,' says Anna Kuusniemi-Laine, Partner and head of the new ESG & Corporate Sustainability service.
The focal points of this new service will be strategic sustainability advice, ESG due diligence (ESGDD) and ESG questions relating to transactions, private equity, financing and management liability. The service covers corporate sustainability matters related to marketing, corporate governance and compliance as well as contract projects and anti-corruption guidelines. Our experts help companies in competition law analyses of ESG-linked partnership arrangements and sustainable procurement projects. Together with our environmental and energy lawyers, the team can also offer a wide range of services for any renewable energy projects, and when strengthened with our experts in employment law and data protection, the team provides versatile solutions to support the equality and diversity work of work communities.
'The duty of care, included in the Corporate Sustainability Due Diligence Directive, and the new sustainability reporting requirements pose a real challenge to companies,' Anna says. 'The ESG & Corporate Sustainability service supports our clients in complying with ESG regulation and implementing their duty of care. Thanks to our full-service offering, clients have a one-stop access to all business law services relating to corporate sustainability.'
EXPERIENCED ESG EXPERT LIA HEASMAN TO DEVELOP THE NEW SERVICE
The ESG & Corporate Sustainability service will be further strengthened in mid-January as Lia Heasman joins Castrén & Snellman as Counsel. Lia has over ten years of experience in business-driven ESG work as well as in the development of human rights and responsible supply chains. Most recently, she was the Director of ESG Transaction Services of an international corporation.
'Lia's main focus will be on developing the ESG & Corporate Sustainability service. In client work she is the natural choice in ESG matters related to transactions, private equity and financing as well as ESGDD work,' says Anna.
SIGNIFICANCE OF ESGDD ON THE RISE
'Companies used to think of ESG as a reputational aspect, but these days it has become a mandatory part of business operations. EU regulation has increased in recent years, and the required minimum level for sustainability is set really high. Even this minimum level requires systematic work from companies, not to mention bringing corporate sustainability to a strategic level that surpasses it,' says Lia Heasman.
The new Corporate Sustainability Due Diligence Directive extends companies' liability to the negative impacts of their value chains. In addition, the efforts and results of companies in tackling the adverse environmental and human rights impacts of their operations are made visible by sustainability reporting under the Corporate Sustainability Reporting Directive. Companies are faced with calls for increasingly ambitious sustainability work from all directions, which means that company management will have to work hard and embrace change.
'The significance of ESGDD work will increase also in Europe in the coming years. The way in which a company plans its ESG work and minimises its adverse environmental and climate impacts can directly affect the company's value. In addition, investors and financiers are increasingly particular on who they work with. Soon conducting an ESGDD report will be as essential as reporting on finances and taxation,' Lia summarises.
SUSTAINABILITY WILL EXTEND TO ALL ASPECTS OF BUSINESS OPERATIONS IN THE COMING YEARS
The amount of regulation is on the rise, and transparent and systematic ESG work will increase a company's value. What do our experts see in the future of corporate sustainability?
'Sustainability used to be something to dabble in during prosperous times and economic upswings, but it has become such an integral part of business operations that companies promote it also in slower financial periods. Companies should keep an eye on regulatory development as it will keep advancing even during recession,' Lia states.
Our experts predict that sustainability, like digitalisation, will extend to all aspects of business operations. An increasing number of company executives, owners and experts will have to know how sustainability is reflected in their own work and what their role is in promoting sustainability goals. This, together with evolving ESG regulation, will bring European companies to a whole new level in sustainable business.
'It is paramount that company executives and owners have a deep understanding of what sustainability and the duty of care, among other things, mean to the company. Pain points must be faced head-on in order to be fixed. While no-one is perfect, the level of ambition should be higher than ever before,' Anna and Lia sum up.
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