Climate risk is professional risk – new tools for commercial lawyers

👉Download the Climate Risk Toolkits below, share them with your colleagues and clients, and start putting them into practice.

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Climate risk at the heart of legal advice

Inspired by our recent research¹ into the legal sector’s role in climate action, The Chancery Lane Project (TCLP) has created a new series of climate risk toolkits.

There is now a growing consensus that climate risk is no longer a side issue or a specialist niche. It is central to commercial legal practice. Lawyers have a duty to act in their clients’ best interests and to maintain up-to-date knowledge. That means recognising that climate change is reshaping markets, contracts and professional standards.

In recent years, The Law Society of England and Wales’ guidance and leading legal opinions have made clear that failing to advise on foreseeable climate-related risks could expose practitioners to negligence claims. Clients, regulators and insurers already treat climate risk as a material financial, operational and reputational factor.

At TCLP, our research set out to explore how climate risk connects to lawyers’ existing professional and legal obligations. The conclusion: climate literacy is not a new duty, but part and parcel of what it means to be a competent, diligent adviser today.

From duty of care to professional obligations

Our work began with a pressing question: do lawyers already have a duty to consider climate risk when advising their clients? The finding was clear: in contexts such as real estate, finance, corporate and commercial transactions, lawyers who fail to raise foreseeable climate risks may well fall short of their duties to act in the client’s best interests and to provide competent advice.

But rather than framing this as a “new duty,” we realised the most effective approach was to show that climate considerations already fit within professional obligations: competence, diligence and client service. This reframing avoids polarisation and positions climate literacy where it belongs: at the core of everyday practice.

Born out of collaboration

To move from theory to practice, we tested these insights with practitioners. During London Climate Action Week 2025, TCLP convened over 55 lawyers across practice areas in a hackathon. Together they mapped how climate risk is materialising in supply chains, mergers and acquisitions (M&A), financial services, energy, technology and construction.

These outputs were rigorously peer-reviewed by practitioners with over twenty years’ experience. The result is a new series of practical resources that combine fresh thinking with the credibility of lived professional practice.

Three kinds of risk lawyers must understand

Through our research and user testing, three kinds of climate risk emerged as most material for lawyers to understand:

• Physical risks: direct impacts such as floods, heatwaves, wildfires and droughts. These disrupt supply chains, damage assets and increase insurance costs.
• Transition risks: impacts of the shift to net zero, including new regulation, investor pressure, carbon pricing and reputational scrutiny.
• Liability (legal) risks: potential liabilities arising from physical or transition risks, including litigation, enforcement, negligence claims, and regulatory or contractual consequences such as penalties, redesign requirements, or cost burdens.

All three categories are foreseeable climate harms, reasonably foreseeable under English law, or otherwise foreseeable in civil law jurisdictions. They are commercially material and carry legal consequences ranging from stranded assets to litigation, enforcement action and board-level accountability.

Acknowledging the significance of legal risks, this blog focuses deliberately on physical and transition risks – to build awareness of their growing relevance to everyday legal practice.

What lawyers can do

Lawyers are uniquely placed to help clients manage these risks. They can:

• Identify exposures early through pre-contract enquiries and due diligence.
• Draft contracts that allocate responsibility fairly, incentivise resilience and allow adaptation to evolving regulation.
• Advise boards on governance duties, disclosure obligations and transition planning.

Many clients now expect their lawyers not only to mitigate risk but also to anticipate climate-related developments that could create both risks and opportunities.

In each case, the lawyer’s role is not just to shift liability, but to design frameworks that enable resilience, long-term value and credible climate action.

Our new Climate Risk Toolkits

The outcome of this project is a set of Climate Risk Toolkits. They are concise, sector-specific toolkits to help lawyers:

• Spot how climate risk shows up in practice.
• Understand why it matters commercially and legally.
• Take practical steps to respond.

They are written to be read digitally, shared with colleagues or clients, and used as conversation starters. They are not standalone checklists but frameworks to integrate physical and transition risks into deals and legal strategy from the outset.

👉 Download the toolkits here:

Why this matters now

Climate risk is already reshaping the legal and commercial landscape in which clients operate. By framing it in terms of competence, diligence and best interests, we can ensure lawyers are not only managing foreseeable exposures but also contributing to a more resilient and sustainable economy.

These tools are a first step. We will continue to expand and refine them as climate risks evolve and as the legal community builds experience in this space.

Download the Climate Risk Toolkits above, share them with colleagues and clients, and start using them in your practice.

We’d also love your input. Please leave your name and email via our feedback form so we can follow up with you. Your experience will help us improve these resources and shape the next generation of toolkits.

Want to go further?

Take the next step with our free CPD-accredited training programme Climate Contracting in Action. Gain practical skills to integrate climate considerations into contracts and advice, with tools you can put into practice straight away.

👉 Find out more and start the course here

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Method and references

1. Method and provenance
   This article builds on TCLP’s multi-phase research into climate risk and professional obligations. The analysis draws on:
   1. Legal guidance and opinions (including The Law Society’s 2023 climate change guidance and leading King’s Counsel opinions on foreseeability).
   2. Practitioner insights generated at TCLP’s Climate Risk Hackathon during London Climate Action Week 2025, involving over 55 lawyers across practice areas.
   3. Peer review by senior practitioners with over 20 years’ commercial experience.
   4. Interviews and roundtable conversations with a wide range of practitioners.
   
   Selected references and acknowledgements
   1. Professor Sarah de Gay, Obligation, Self-Regulation, Lawyers and Climate Change – Exploring the Scope of Duties to Advise (2022).
   2. Stephen Tromans KC, Advice in the matter of Conveyancers’ Duty of Care to Advise Clients about Climate Risk and How to Discharge Such Duty (2022).
   3. The Law Society, Climate Change Guidance for Solicitors (2023).
   4. The Law Society, Climate Change and Property Practice Note (2025). 
   5. TCLP, Climate Risk Hackathon (London Climate Action Week 2025). ↩︎