Front and centre

This is the age of diversity, with firms increasingly working with diverse clients as they grow nationally, internationally and into emerging economies. In adapting and responding to the opportunities diversity represents, law firms, and their leaders, need to focus on two main things: first, attracting and then developing the growing number of female and minority lawyers; and second, ensuring that all partners, legal and non-legal staff have inclusive capabilities. By this, I mean the ability to understand and respond to the different needs of diverse clients and local communities (wherever in the world they are operating) in the way that they work and the work that they do.

Achieving change around inclusion and diversity is no different from implementing change in any other area of organisational life

In this article, I look at the importance of diversity in law firms, and the role of leadership in meeting its challenges, particularly those related to promoting diversity and inclusion in your staff and partner group.

Why diversity matters

The profile of people in the UK is changing. The ethnic minority population of England and Wales almost doubled in a decade, from 8.7% in 2001 to 14% in 2011. An increasing number of women are in work: there has been a net increase of 1.5 million since the last recession in the 1990s. More than 1 in 20 people in the workforce today are lesbian, gay or bisexual (LGB). Nearly a fifth of the working age population, and a third of people aged 50-64, have a disability, and a third of all employees are disabled or are close to a disabled person. These changes have a significant effect on both law firms’ client base and their current and potential workforce.

Your clients

One in 10 of London’s 250,000 businesses is Asian-owned, and Britain is estimated to have well over 5,000 Muslim millionaires, with liquid assets of more than £3.6bn. LGB consumer power is worth an estimated £70-81bn. Women own 48% of the nation’s personal wealth – expected to rise to 60% by 2026 – and make up 47% of the labour market.

Corporate clients are increasingly looking to ensure that their panel law firms match their values and commitment to equality and diversity. The Law Society’s procurement protocol has been signed by 36 large purchasers of legal services, including FTSE 100 firms such as Barclays, BP, BT, GlaxoSmithKline, HSBC, Land Securities and National Grid. It also includes a range of local authority, NHS and other public sector organisations. All signatories are committed to engaging with law firms which take active steps to follow good practice in embedding inclusion and diversity within their organisation. Law Society research in 2011 on the impact of the procurement protocol found that purchasers of legal services are increasingly moving towards selection (and de-selection) based on evidence (or lack of evidence) of sustained diversity improvements and initiatives within law firms.

Your people

A law firm’s biggest asset is its staff. Attracting, retaining and progressing the very best talent is essential. Research strongly suggests that diversity in the partnership group of a law firm matters, and has the potential to make a positive impact, not only in helping to avoid the risks of ‘group-think’, but also in improving bottom-line results. For two consecutive years (2011 and 2012), the Eversheds board report has shown that companies with more female directors perform better than those without. Research by Credit Suisse has found that companies with one or more women on the board delivered higher average returns on equity (Gender Diversity and Corporate Performance, Credit Suisse Research Institute, August 2012).

Many leaders are recognising the importance of diversity, too. In 2011, James Turley, chairman and CEO of Ernst & Young, highlighted the importance of developing leaders who are not only diverse themselves, but who also have the skills to ensure success in diverse emerging markets. And David Morely, chairman of Allen & Overy and a member of the 30% Club (a group of chairmen of UK businesses committed to increasing board diversity) states: “Mao Tse-Tung once said: ‘Women hold up half the sky’, an observation at odds with the reality of UK business, where the upper echelons – at board and partner level – still tend to be heavily dominated by men. It’s time to crack this nut. The 30% Club is designed to bring a better balance to boards and partnerships. Essential for any business that wants to remain competitive in the future, in my view.”

The 2012 annual review of the Law Society’s Diversity and Inclusion Charter shows that the diversity of legal talent among signatory firms is increasing, but that there is further work to be done to ensure that diverse talent is well represented in the partnership of law firms. While women made up almost two-thirds of all solicitors across the charter’s signatory firms, they represented less than one third of partners. And although 10% of solicitors are from a black, Asian or minority ethnic (BAME) background, they made up only 6% of partners. The report showed a rise in female partners among signatories, from 17% in 2011 to 23% in 2012, but only a small rise in the proportion of partners from BAME backgrounds: just 1.6% since 2011. Clearly progress is being made, but slowly.

The barriers to greater diversity in leadership have been cited time and again in many different studies. What those studies have in common – whether they are looking at race, gender, disability, sexual orientation, age or socio-economic background – is that barriers to recruiting and developing diverse talent are often rooted in behaviours within the workplace. It is often our natural tendency to recruit in our own image, to make assumptions about a woman’s career aspirations, to put a team together based on who we know rather than looking more widely for talent, to talk over someone who is less gregarious or outspoken. These are all often unconscious biases and actions, but they significantly contribute to building barriers to women and people from minority backgrounds gaining entry or progressing their careers in the legal sector.

Overcoming barriers to achieving greater diversity in the legal sector and developing inclusive capabilities will require many law firms to introduce change – to do things differently. This may affect how firms recruit, develop and promote staff, as well as how they bid for and undertake client work. The changes needed not only affect processes and procedures, but also have an impact on behaviours at work. And all of this needs to be championed from the very top of the firm, by its partners and other leaders.

Research has shown that leaders with inclusive capabilities are defined by three common characteristics (Inclusive Leadership – from Pioneer to Mainstream, Dr Gillian Shapiro, Helen Wells and Rachael Saunders, Opportunity Now in partnership with Shapiro Consulting Ltd, September 2011).

First, they are adaptable. Inclusive leaders are highly aware of diversity among the people they work with and manage. They are comfortable with using different and flexible approaches to work organisation to get the best results and the most from their team. They are skilled at adapting their style to complement others, shifting cultural perspective in authentic ways.

Second, they are skilled in building a diverse talent pipeline. Inclusive leaders understand their own role and responsibilities in seeking out and supporting the development of the best talent from a range of backgrounds, and they play an active part in this process. They are key to ensuring that the business has the range of diverse talent it needs.

Finally, they are innovative. Inclusive leaders are skilled at creating a working environment that fosters innovation – where all employees feel safe, valued and empowered to innovate.

Why size doesn’t matter

Smaller law firms may be put off working to make change in this area because they don’t feel they have sufficient resources. However, the Law Society’s Diversity and Inclusion Charter 2012 annual review clearly shows that size doesn’t matter when seeking to make improvements to create a more diverse and inclusive law firm: both small and large firms are achieving levels of success in different areas of the charter.

‘Employment and staff development’ – that is, building greater diversity and inclusion into the way in which staff are recruited, developed and promoted, and work is organised – is an area that all signatory firms need to focus on more. But small firms are leading the way. Almost half of small firm signatories are demonstrating best practice in this area, compared to only 19% of large firms.

For example, flexible working is often thought to be difficult to achieve in the legal sector, where responding to client needs is paramount. However, Sharon Langridge Employment Lawyers is showing how building a culture of trust and collaboration enables people to manage work with outside-work responsibilities, and build a strong team that can respond to client needs. The team totals five people, one being a new recruit and another having joined the firm in 2012. The firm has a strong ethos of collaborative working, with a ‘flat’ structure rather than a hierarchy. This ethos encourages openness and flexibility that goes beyond statutory rights. A pregnant solicitor’s request to return after the birth of her child for two days a week to support the other solicitors has been agreed, with an arrangement to build up her hours in the coming months. This suggestion was instigated by the principal of the firm. A new solicitor works flexible hours, with a great deal of home working and control over where he works. The firm has enabled support staff to enhance their roles by allowing them to develop more independence, and crafting the jobs to fit their strengths.

Both small and large firms are also taking action to ensure that they provide inclusive and responsive services which meet the needs of diverse clients. Over half of the small firms (57%) and a third of large firms (33%) in the charter cohort have achieved best practice standards in this area.

Pinsent Masons ensures that its website is accessible to the widest possible audience, and usable by people of all abilities. All pages of the website conform to level AA of the Web Content Accessibility Guidelines 2.0 (WCAG2.0) and where appropriate, some level AAA checkpoints. The firm’s website can be viewed on a range of different screen sizes, and the size of text can be changed to suit different people. A search facility and a sitemap is included to help people find information more easily.

Morgan Denton Jones provides training materials in font sizes suitable for those with visual impairments, and its people have met disabled clients at locations to suit them, rather than expecting them to come to the firm’s offices. They have also made special arrangements with employment tribunals to accommodate the needs of disabled witnesses, including the need to adjourn more frequently than normal for rest breaks. They provide refreshments for those with special dietary requirements.

Virgo Solicitors offers its client care letters and other correspondence to visually impaired clients in Braille format, and it offers to translate its correspondences into Turkish for its predominantly Turkish client base. (These procedures will be devised only where it is permitted by the relevant anti-discrimination legislation.)

What you can do

Achieving change around inclusion and diversity is no different from implementing change in any other area of organisational life. It requires a rationale for the change, clear objectives, an implementation plan, performance indicators so that progress can be tracked, appropriate resources in place, and strong leadership at every level. Joining the Law Society’s Diversity and Inclusion Charter will provide you with all the tools you need to manage these elements and champion diversity in your firm (see box opposite).

One area where we have found that many charter firms still struggle is building diversity and inclusion into employment and staff development practices. Changes in the diversity of client and talent profiles mean that the legal sector must address this weakness in order to sustain competitiveness and growth in the future. Below are four things every manager or leader in every law firm can personally do to help develop a diverse and inclusive work environment. There are also four actions every law firm – large or small – can take to ensure it gets on track with the changes needed to respond to the challenge and opportunity of diversity.

Your next steps

1. Take time to build relationships with your team, colleagues and clients, and to understand those who may be different from yourself.
2. Consider the extent to which your team reflects diverse backgrounds and how you leverage this to avoid ‘group-think’.
3. Build awareness of any unconscious bias you have and what you can do to minimise its impact.
4. Mentor or sponsor someone with high potential from a group under-represented in your firm’s leadership.

Your firm’s next steps

1. Make sure that, as a leadership team, you are clear about how diversity and inclusion can help your business, and that you communicate its role and importance to everyone in your firm. Don’t make this a ‘nice to have’ issue but a ‘must have’ one, which underpins business success and becomes part of business as usual.
2. Be clear about the diversity and inclusion improvements you want to achieve as a firm, and create an action plan to achieve them and a set of performance indicators to help you track progress. Make this part of your core business planning and reviewing process.
3. Identify and develop the capabilities you need in your firm to create a diverse and inclusive work environment.
4. Make diversity and inclusion everyone’s responsibility, not just that of those who are involved with HR. Only recruit and promote people who demonstrate the values and behaviours you need to achieve the diversity and inclusion improvements you are seeking.