“Our practice has changed tremendously in the last five years,” said Justin Savage, the co-head of the environmental and automotive and mobility groups at Sidley Austin LLP, on this week’s Drinks With The Deal podcast. “Environmental issues — the E in ESG — have skyrocketed in visibility.”
That change requires senior management teams and boards pay much greater attention to environmental issues — and that lawyers communicate with them at the right level of detail, Savage said. Not only do companies have to manage environmental risks, Savage said; they also have opportunities stemming from climate and ESG issues thanks to the economic possibilities created by such technologies as carbon capture storage and electric vehicles.
Savage draws upon his experience as a lawyer in the Environmental Enforcement Section of the Department of Justice between 2004 and 2007 to help companies navigate these issues. In 2007, he helped the DOJ secure a then-record settlement with American Electric Power Co. (AEP), which agreed to an annual reduction of 813,000 tons of air pollutants emissions at an estimated cost of more than $4.6 billion.
“Working on a case like AEP, you quickly understand that the federal government and the states have different considerations when they’re working toward a settlement than companies do,” Savage said. His challenge in advising companies is “how to translate from the commercial dealmaking context to the government’s dealmaking criteria and to try to find the bridge between them. It’s almost like people are speaking two different languages.”
That skill will continue to be critical given the attention that the federal government, state regulators and foreign governments are giving to environmental issues. “This is not going away,” Savage said.
Here’s the podcast with Justin Savage: