Singapore law firms see rise in ESG advisory demand

More clients are seeking advice on carbon projects and international trade.
 

Singapore law firms are seeing a surge in client demand for sustainability-related advice as companies scramble to meet tighter environmental, social, and governance (ESG) rules.

Law firm Dentons Rodyk & Davidson LLP said more clients are seeking advice on carbon projects and international trade, where compliance with overseas rules is critical.

“Those impacted by commercial considerations, like businesses investing in carbon projects or involved in international trade… are the sectors most actively seeking sustainability legal assistance,” Jean Nie Ho, a partner at Dentons Rodyk and head of its ESG practice, told Singapore Business Review.

Singapore’s sustainability legal service market is expected to grow 10% annually to as much as $500 million by 2033 from 2023, according to a study by PricewaterhouseCoopers (PwC) Singapore.

The report cited key drivers such as Singapore’s Green Plan 2030, the 2050 net-zero target, and the Carbon Tax Act, along with the implementation of Article 6 of the Paris Agreement, all of which create new compliance requirements for businesses. These shifts have generated more work for law firms advising on carbon tax, emission projects, and regulatory alignment.

Despite the growth outlook, PwC highlighted hurdles for law firms. Gaps in technical expertise, strong competition from international players, and client pressure to keep fees low remain major challenges.

While most lawyers are familiar with sustainability concepts, the study found limited formal training in the technical knowledge needed to support complex ESG projects. PwC said clients increasingly demand advice that combines legal insight with commercial acumen to guide compliance and investment decisions, but their choice of counsel is still shaped by costs.

Dentons Rodyk said it has broadened its sustainability capabilities by tapping lawyers from its corporate, finance, projects, and dispute practices, in addition to drawing on the company’s global network.

The firm now handles tasks ranging from drafting agreements for emission reduction projects and advising on carbon tax clauses in contracts to representing the PNG Sustainable Development Program in litigation over state control in Papua New Guinea.

Dentons Rodyk’s approach reflects the multifaceted nature of sustainability legal services. “We review resource requirements based on matter load and persistence,” Ho said in an emailed reply to questions.

PwC identified the scopes of sustainability-related legal work, including financing, infrastructure, technology, carbon markets, disputes, and compliance reporting. 

The report noted that carbon markets involve structuring offset projects and procuring renewables. Reporting and compliance often include mandatory sustainability disclosures. 

Financing covers not just green bonds and loans but also the environmental risk management guidelines of the Monetary Authority of Singapore.

Disputes range from shareholder activism and greenwashing allegations to questions over directors’ duties and business obligations in a sustainability context.

PwC said law firms that invest in specialist expertise and collaborate with professional services partners will be better positioned to secure a bigger share of this fast-growing market.

By broadening capabilities and building track records, Singapore lawyers can move beyond traditional legal advisory work and take the lead in sustainability services, it added.