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September 11, 2014 Articles

The Business Case: Six Things Law Firms Can Do to Achieve Diversity

A new IILP report details whether diversity is reality or wishful thinking.

By the Hon. Karen Wells Roby

In diversity circles, you often hear this phrase: “the business case for diversity.”   

After this committee’s first newsletter, however, we discovered a report published in 2011 by the Institute for Inclusion in the Legal Profession on the case for business diversity. This report represents further hard data measuring the accuracy of this perspective and the extent of these experiences.

The study participants, in addition to corporations, included 391 law firms representing 65.8 percent of law firms with 501 or more lawyers and 39.8 percent of law firms with 251–500 lawyers on the National Law Journal’s list of 250 largest U.S. firms (subscription required). It also included 1,032 diverse partners. This article will focus on the law firm’s response to the business case for diversity. We will look at the corporation’s response in the forthcoming Fall newsletter.

The study focused its research on law firms located within the United States and did not include offices or lawyers in other countries. Interestingly, the study concluded that while a business case for diversity does exist, law firms as a group note that there is lack of measurable increases in the amount of business they receive in recognition of their diversity efforts. This has resulted in a relatively uniform approach to diversity: few firms find it worthwhile to step outside the parameters of acceptable diversity programs and activities.

The report notes that structurally law firms as a group are following an unremarkable strategy of diversity efforts with little reason to attempt to do anything that might be considered particularly dramatic or innovative, until one firm or another is able to demonstrate that a new approach might merit consideration.          

Diverse partners in the firms indicated that the business case for diversity has proven very disappointing.  While many of these partners receive business from corporate clients who have expressed a commitment to greater diversity, the number of actual clients that use their services and the amount of work they actually receive as a result has been lower than the publicity surrounding corporate diversity commitments.

In contrast, law firms reportedly have an inflated expectation about the amount of business that a diverse partner should be able to generate. This misperception by the diverse lawyer and their law firm creates an inaccurate perception about the value the diverse lawyer has or the business that the diverse lawyer should be able to develop. It may also provide an explanation for some of the attrition challenges of diverse partners from firms where they first became partners.

In light of the challenges firms face in achieving diversity, the report suggests that law firms and their partners should implement these six things to improve their business case for diversity:

1. Support its diverse lawyers’ membership in, attendance at, and sponsorship of national and local minority/women/diversity bar associations whose meetings they find beneficial in their business development efforts.

2. Engage diverse partners in firm management beyond diversity committees and hiring committees.

3. Track conversion rates of associates to partners and non-equity partners to equity partners for diversity categories and address those instances where conversion rates are less than desired.

4. Consider adopting internal policies wherein upper firm management shares direct responsibility for the firm’s diversity efforts.

5. Implement business development strategies that emphasize personal contact (one-on-one meetings, email, and telephone calls) rather than scattershot, mass-marketing approaches.

6. Include lawyers with ADA-recognized disabilities in efforts to promote diversity.

The study concluded that while there is a business case for diversity, it stops short of generating the significant amounts of business to enhance career sustainability, and success of meaningful numbers of diverse partners. While a corporate clients’ interest in diversity serves as an impetus for law firms to increase efforts to recruit, retain, and promote diverse lawyers to their partnership ranks, law firms still do not track the corresponding increase or decrease in business from clients committed to diversity.

As a result, diverse partners become disenchanted and their value is often misunderstood by well-meaning people. As firms begin to implement the six practices recommended by the report, maybe then the picture will become clearer regarding the diverse lawyers’ value as well as strengthening the firm's business reason for diversity.

For more information, see The Business Case for Diversity: Reality or Wishful Thinking?

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