Before joining the sustainable finance space, Climate Asset Management's Varnika Chawla had already experienced some career highlights that don't often come at such an early stage of one's career.

As a tax and constitutional law clerk at the Supreme Court of India, she helped write some of the key judicial decisions of recent years, including those that made privacy a fundamental human right in India and the decriminalisation of homosexuality.

It was working on these human rights cases that she took an interest in sustainability, and the human effects of climate change – something which is particularly visible in her home country, as well as the broader Global South.

After spending a few years with the international tax practice in Kirkland & Ellis' London office, it was in 2021 that she was able to move to its newly launched ESG and Impact practice to "get into the meaty substance of what it means to be sustainable".

"The law guiding ESG practices was still in a nascent stage and evolving rapidly, and so it was a really good time to be able to set up those legal structures, within which market players can actually operate and make a difference," she tells Environmental Finance. Chawla says it was in this role that she "started to feel extremely fulfilled in my career because I could see the law as a tool to give back to the community".

After overseeing the establishment of some top sustainable investment funds in Europe and a number of major sustainable investment transactions, Chawla was offered the role of legal manager at Climate Asset Management – a role created specifically for her. The role includes supporting fundraising and investment negotiations and ensuring project implementation meets global regulations.

Climate Asset Management – a joint venture between HSBC and Pollination – invests exclusively in natural capital, predominantly regenerative and sustainable forestry within its natural capital strategy. Its nature-based carbon strategy targets landscape conservation and carbon credit generation.

The global nature of the portfolio means Chawla often has to be aware of legal requirements spanning jurisdictions in Europe, Asia, Latin America, Africa, Australia/New Zealand and North America. She admits this was "overwhelming but exciting" when she first started the role, as unexpected downstream legislation can often significantly impact portfolios.

To better track these developments, Varnika set up CAM's regulatory working group which has become a leading hub and actively contributes thought leadership on regulatory interpretation.

Chawla has supported what she calls "unique transactions", including a deal investing in US land-based assets that had been destroyed by wildfires, restoring the land and carrying out integrated forest management activities. Dealing with three jurisdictions – the US, Luxembourg and the Netherlands – meant this was a major trans-boundary legal process.

While creating a legal transaction from scratch can be difficult, it is these experiences that Chawla values the most in her role and considers a real opportunity to make a mark in this space.

She is currently attempting to develop a securitisation structure within Article 6 transactions – global carbon markets to meet the goals of the Paris Agreement – whereby investor money is better secured in the advent of legal changes.

Climate Asset Management is also looking at how to ensure the land rights of the communities or project developers are protected within such transactions. She says: "Not much has been done on this. But that's why it's exciting, because I get to work at the cutting edge of the market, structuring those transactions in a way which we think would work best".

Chawla says this is where her experience of having trained in India really comes to use, because "it directly translates to the needs of the countries in the context of carbon market transactions."

Growing interest in nature investments means that this is a particularly busy and challenging time to be involved, but she says she is optimistic about the potential to affect change.