How to Implement a Diversity Program in the Legal Department

Diversity and inclusion initiatives are about providing development and leadership opportunities to everyone – regardless of gender, race, or creed. Many corporations have formal diversity statements and programs to support these initiatives. Law departments are an area of increasing focus because it has been noted that they are generally more diverse than law firms within the legal industry.

According to the National Association for Law Placement, a disproportionate number of white men serve as equity partners in multi-tier law firms. As of 2016, only 5.8% of equity partners were racial or ethnic minorities; only 18.1% were women despite that more than 40% of law school graduates are women and have been for decades. Also, a recent Forbes article citing an MCCA/Vault study highlights that African-American and Asian-American representation in law firms actually decreased in 2014/2015 compared to 2007.

In a multicultural nation, the skills and talents of its diverse citizens should be valued.

There is an opportunity for leadership and buying power to reflect and to promote diversity. Over 100 corporations have signed ABA Resolution 113, which urges the industry “to expand and create opportunities at all levels of responsibility for diverse attorneys” and for clients to assist in this effort. Many more are implementing their own programs. Microsoft, Google, and HP are all putting in programs urging more diversity from their law firms. In some cases, companies may offer the incentive of more work. In other cases, they may hold back a percentage of the law firm’s bill until the firm provides more opportunity for diverse attorneys.

Clients have choice and leverage now, and technology helps make it possible. They can articulate their vision of what they would like to see in the law firms that represent them. They can elect to work with firms with diverse ownership. They can take their business to firms that provide the best service and match their values and culture.

For example, CounselLink® enterprise legal management solution allows clients to obtain information, which firms supply at the individual timekeeper level, regarding ethnicity, gender, or disabled veteran status. Reports can be generated based on work done for the department by those variables with tracking of hours and money by practice area, region, line of business, firm, or matter. While personal information cannot be required, it can be requested, and it is all stored on secure servers with strong data privacy procedures.

The first step is taking a stand and setting a goal.

Ask some important questions to understand where you are now. Many of my clients have chosen to gather information about their baseline now and frame their request to counsel accordingly. The initial request for information can be firm-level or timekeeper level information, and the first measurement is compliance with fulfilling the data request. Do not be surprised if you find low compliance in reporting initially – a quick look inside our system, with nearly $30 billion in law firm invoices, revealed that less than a quarter of the timekeepers reported either gender or ethnicity. To improve reporting compliance, rules can be added to the e-billing system, such as reductions in payment amount or rejection of invoices from firms not providing firm-level data.

Once this process is in place, and there is some compliance around the data request, clients move to framing specific diverse goals. This should be done concurrently with a review of corporate culture and goals and followed by communication of these goals internally and externally. This includes sharing the information with the law firms. Using a data-driven approach allows for far more productive conversations downstream as you make tough decisions about the firms you work with.

The entire process should be supported by a live, interactive dashboard, giving immediate visual insight into the program. This insight should include a chart showing compliance/non-compliance with data requests and breakdown of spending by gender and ethnicity (and/or other factors) – sliceable by role in the firm (partner, associate, paralegal, etc.) along with other variables. Key strategic stakeholders can interact with the data directly, comparing firms in real time and focusing on the complete picture for a more solid understanding of results. The holistic view can be shared with each firm as part of an ongoing relationship, letting them see where they fit in the program.

People and institutions play a role in changing perceptions and society.

Corporate law departments are in a unique position to ask for, support, and encourage diversity in the law firms they work with. Measurement of the current situation helps migrate to the desired situation – law firms and law departments hiring the best individual for the job, and clients hiring the best law firm for their work. Without measurement, we cannot manage to the results we seek.

Next week at the ACC 2017 Annual Meeting, I will be facilitating a panel discussion on How to Build a Diversity Initiative in Support of ABA Resolution 113. Sign up to schedule a meeting during the ACC 2017 Annual Meeting.

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