Environmentally conscious drafting – The Chancery Lane Project
On 26 February 2020, The Chancery Lane Project (“TCLP”) released the first edition of its Climate Contract Playbook (“the Playbook”). TCLP brings together legal professionals from across the country, including Acuity Law, who seek to facilitate change through environmentally conscious drafting. On their website, TCLP state:
“our mission is to create contracts and model laws to enable communities and businesses to fight climate change and achieve net-zero carbon emissions for a 1.5-degree world. We will achieve this through collaborative problem solving”.
The Playbook includes 16 precedent clauses that have been collectively drafted by over 120 lawyers and legal professionals.
TCLP have chosen to give the clauses names of children in a move to remind readers of the impact the inclusion of these clauses can have on future generations. We look at 3 of these precedent clauses below.
Agatha’s clause creates a contractual right to switch to a greener supplier without penalty for early termination if the existing supplier cannot match a greener offering. This clause aims to promote the importance of offering greener services and seeks to incentivise businesses to continuously improve their environmental performance.
Jessica’s clause seeks to impose carbon performance requirements into private agreements. The purpose of this clause is to provide remedies for breaches that cause damage to the climate. To safeguard against businesses using this type of clause for personal gain, best practice (in both a legal and climate-conscious sense) would be to ensure that any damages be recovered by way of mandatory donation to a not-for-profit organisation.
Darcy’s clause intends to inspire businesses to introduce an environmental statement into their board minutes. The goal is to encourage directors to take into consideration their environmental and social impact objectives, the company’s carbon footprint, and the climate change risks as a routine part of their decision-making.
Climate change finally appears to be at the top of the agenda in many boardrooms across the world, with businesses striving to do as much as possible to reduce the impact their business has on the environment. In recent weeks it emerged that Amazon’s Jeff Bezos intends to give approximately $10 billion to scientists, non-governmental organisations, and activists working on climate change. Whilst we note that not everyone has a spare $10 billion to channel into combatting climate change, a great place to start would be to make your commercial agreements more environmentally conscious. It is worth noting that due to the novelty of these clauses, their enforceability is yet to be challenged in the Courts, however, we are sure that they will soon become commonplace in commercial contracts.
If you would like some more information on how to incorporate environmentally conscious drafting into your key commercial documents, please contact our Commercial team.