We speak to A Word About Wind community member Chris Cayley, founding director at specialist legal recruiter Cayley Coughtrie, for his views on the legal and regulatory issues facing companies in the wind industry and the role that in-house lawyers can play.
How did you get into renewables?
I’m a geography graduate from Durham University and, even in the early 80s, people were talking about environmental issues and sustainability. The interest was born there.
I ended up joining a City firm to do my training on the basis that it had an environmental department. I did six months of my training contract in the environmental department but spent a lot of my time looking at waste management issues. Back then, major corporates were not coming at it from the angle I envisaged, so I didn’t continue with environmental law.
Then I got into legal recruitment in the mid-90s and, in 2003, I was involved in setting up a business called First Counsel doing quite a lot of work for law firms and companies in energy, infrastructure projects and project finance. But my interest in renewables really got sparked again when a climate change charity called 10:10 launched. They had a campaign to reduce your carbon footprint by 10% in 2010. First Counsel reduced its carbon footprint by around 30%. I ended up joining its board as a trustee and was there for four years.
Where does Cayley Coughtrie fit into this journey?
Cayley Coughtrie is a relatively new business. After I left First Counsel, I had a two-year foray back into the world of a big corporate recruitment business but I realised that I much prefer being my own boss, so I set up Cayley Coughtrie in 2016. We are a specialist legal recruitment business with three partners with combined legal recruitment experience of nearly 50 years.
We focus on senior-level recruitment and I feel we’ve got something to offer to companies in the renewables sector who may be looking to build or strengthen an internal legal capability.
What sorts of issues in particular?
Any company that gets to a certain point in its development is dealing with a whole raft of legal issues, from the regulatory environment they operate in to issues of raising finance, corporate structuring, employee issues, commercial arrangements and agreements, power purchase agreements. There are lots of issues that come up as a company grows, and they have to decide if they’re best serviced by a law firm or someone embedded in the business who gets to know the business and can provide legal, commercial and strategic advice.
How does this fit with the challenges facing firms in the sector?
At Financing Wind Europe, it was quite clear that maintaining profitability and cost control is right at the top of the agenda for the industry, and there’s no question that a good in-house lawyer or good in-house team can add an enormous amount of value.
Some of that value is financial as they will be controlling and reducing the external legal spend or making sure it’s spent well, but they can also add value in a range of other ways including being a different voice at the table, adding a different strategic insight, managing risk, and managing relationships with stakeholders in the business and external regulators.
And companies also face big reputational pressures too.
Absolutely. Sometimes there are bigger-ticket items like reputational litigation or business-critical transactions. Good processes and procedures can prevent the business from getting into litigation or commercial scrapes in the first place. Time and again I hear from people I’ve placed into a company as their first lawyer that, with the right approach, the number of issues passed onto them as counsel to the business increases. They can then be managed and dealt with effectively and efficiently by someone who is dedicated to the business.
An in-house counsel’s job is to be on top of what’s coming down the track, to anticipate the impact on the business and advise on how to mitigate risk or to adapt the business to meet new legislation that is pending. A good in-house lawyer will be networking, talking to regulators, talking to peers in the industry, and making sure they’re on top of their market.
Does increased focus on the climate crisis increase these pressures?
As well as the need to increase profitability, it seems to me that we’re at a tipping point in the climate debate politically and globally.
We had probably the most important COPs ever last year and this year. If governments are going to take the action they need to over the next 10-15 years then they’re going to need to deliver huge capacity. For companies to deliver these projects, there are going to be big challenges in raising finance, gaining backing for these projects, and then delivery. It’s a very exciting time for the sector and we are all facing big challenges at the moment.