Both as a simple question of morality and as a business benefit in an era of globalization, the importance of having diversity in law firms as well as in legal departments is beyond argument from my perspective. Women, minorities, and lawyers from other cultures should be given an equal chance to be hired and promoted—and should be given “stretch” assignments just as frequently as all other lawyers so they are able to show how far they can advance. In making decisions about whether to retain firms, General Counsel and inside lawyers can, at a minimum, ask the outside counsel firm for the diversity profile of the firm (associates, partners, leaders) and the trends in that profile.
Law departments can also ask for the diversity profile on the corporation’s matters in general and on particular matters or a particular block’s business. They can also ask for data on pay differentials and for firm policies and implementation practices relating to diversity. They can ask further about how diverse candidates fare in promotion to partnership and firm leadership. Just asking for this information to see if the law firm keeps it in a systemic way can have some benefit. This is information they should be keeping, and it should not be viewed as burdensome “paperwork.” Beyond simply making the inquiry, corporate law departments can state as a guideline that this information will be relevant to a decision to hire the firm and can be decisive, “all other things being equal” (more or less). It may be neither feasible nor desirable for major corporations to set goals for major law firms on this range of diversity issues, but asking for information, and being serious about the relevance of that information to hiring decisions, can be a powerful tool nonetheless. But if this information is accumulated but ignored in the legal department’s retention decisions, then it sends a terrible message to the law firms and to diverse lawyers for which the General Counsel and his senior lawyers are responsible.
Legal departments could also issue an annual report praising those firms with strong efforts in diversity that the firms could use in their marketing efforts. Obviously, this kind of inquiry, and its use in decisions, is even more credible when the legal department itself has strong policies, creative implementation practices, and a good record.
Law departments should consider going beyond these steps and having them advance to leadership positions. For example, under highly regarded GC Brad Smith, Microsoft pays its law firms an annual bonus (2 to 3 percent) on their total fees if they meet one of several different predefined diversity goals both in the firm generally and in firm leadership positions. Microsoft and other leading corporations helped found the Leadership Council on Legal Diversity, which brings together the managing partners and General Counsels of about 220 major institutions across the country. It focuses on the professional development of diverse lawyers, starting with internships for diverse law students, assisting entry-level hiring, and extending to lawyers in the mid-career stage.
So, too, General Counsel can ask that firms provide information about the scope and trends of their pro bono programs, especially how they are giving young lawyers experience, responsibility, and accountability that might not occur until later in their careers on paying firm matters. As with diversity, law departments can choose to use this information in deciding whether to retain firms. They can use the tremendous example of some firms with discrete pro bono departments and partner-level pro bono leaders to ratchet up the effort of other firms. The Association of General Counsel can seek to work with the Association of Pro Bono Counsel, which is an umbrella organization for pro bono activities in major law firms.
Moreover, there are numerous opportunities for law departments and law firms to work together in jointly providing pro bono services. The Pro Bono Partnership, which GE and other corporations founded in 1997 for corporate lawyers to work on pro bono matters, now also draws on lawyers from firms to serve community organizations. It has become a joint law department–law firm entity. The Intel example of law department–law firm integration described earlier includes joint planning and cooperation on pro bono services.
Also, as previously noted, major law firms and large corporations, working with local bar associations and local public defender and legal aid groups, should consider a systematic legal needs assessment for their local communities followed by a more comprehensive action plan—with real resource allocation—to close the gap. Although precise numbers are hard to come by, the total annual resources used by law departments and law firms on pro bono services as a percentage of total inside and outside annual spend is likely to be but a fraction of 1 percent. This number should be a source of embarrassment, not pride, for law departments and law firms.
Reprinted with permission from The Inside Counsel Revolution: Resolving the Partner-Guardian Tension by Ben W. Heineman Jr. ©2016 by the American Bar Association. All rights reserved.