August 06, 2016

Fortune 500 general counsels: Diversity and inclusion make good business sense

Outgoing American Bar Association President Paulette Brown says about creating the ABA Diversity and Inclusion 360 Commission that patience is a virtue that she has spent years cultivating. “I have relied upon patience, combined with a healthy dose of persistence, through my career to overcome obstacles and create opportunities for myself and others. But when it comes to diversity and inclusion, I am no longer patient. The time is now to move from dialogue to action.”

And that is precisely the message the four panelists on the ABA CLE program “Fortune 500 General Counsel sharing the 3Cs of Diversity & Inclusion – Commitment, Candor and Collaboration” wanted to get across to the audience in attendance at the Aug. 6 program held during the ABA Annual Meeting in San Francisco.

Moderator Dennis W. Archer, past president of the ABA, lauded the panelists, who are all current or former general counsels and who he said they themselves or their companies have a long track record in supporting and promoting diversity and inclusion.

“I’m a little bit older than some of the people here in the room but when I was first introduced to diversity and inclusion it was first called civil rights,’’ said Mark Roellig, executive vice president and general counsel of Mass Mutual Life Insurance Company and a co-chair of the DI360 Commission. “At that time civil rights were thought to be ethically, legally, morally and religiously the right thing to do, and they still are. However, since that time, particularly in corporate, there is becoming a continuing and growing reality that it makes good business sense…to focus on diversity and inclusion.”

“There are many reasons for that and the first two are talent and customers are changing very quickly. By 2042, whites will be the minority in this country never to be reversed. So the demographics are changing,” Roellig said.

“In addition, through diversity and inclusion — you need both — you frankly make better decisions, you’re more creative, more innovative, more engaged and at the end of the day you are more productive,” Roellig noted, saying that diverse teams are critical to the success of corporate America.

Panelist Kim Rivera has been on the job for only eight months as chief legal officer and general counsel of HP Inc., but said the company has a long history of being transparent about its commitment to diversity and inclusion. She noted that in 2015, there were eight appointments of women to boards of directories of U.S. companies. “Half of them were to HP boards,” Rivera said. “Our current board is comprised of four women, two African-Americans, a Latina and a number of South Asians as well. We wanted to be explicit in demonstrating that it can be done with effort. And we apply that same effort inside to our executive team, to our management teams and down the line.”  

Panelist Karen Roberts is executive vice president and general counsel of Wal-Mart Stores, Inc. She said Wal-Mart legal team’s commitment to diversity and inclusion is an outgrowth of the company’s corporate culture and basic beliefs of respect, service, excellence and integrity.

At Wal-Mart, I lead one of the most diverse legal departments in corporate America,’’ Roberts said, rattling off the numbers. “We have over 200 women and minority lawyers who serve as relationship partners with the law firms that we work with and they get about $90 million worth of business. From fiscal year 2015 through fiscal year 2016, we spent $189 million with women and diverse attorneys. And we did that because we were very deliberate. You have to have tough conversations with firms.”

As general counsels and the head of the legal team, the panelists said you have to set the tone for the company in its hiring practices from the top to the bottom. They suggested developing a program that creates an environment that supports and rewards diversity and inclusion both internally and externally, develop a pipeline of diverse attorneys through networking and mentorship programs and hold people accountable if they don’t follow through.

Roberts relayed a situation at Wal-Mart in 2005 when the company asked the firms they were working with to share with Wal-Mart their relationship partners and to include on that slate and at least one woman and one person of color. “We wound up shifting $60 million in business over the course of a few weeks as well as turnover 40 relationship partners,” Roberts said. “I was the general counsel of the real estate division at the time and I actually fired a firm because they said I was trying to tell them how to run their business. I said that as a consumer of their services, these are my expectations and if you are not willing to meet them we’re not going to use you, so we parted ways. That was a $12 million book of business.”

The 360 Diversity and Inclusion Commission was charged with conducting a comprehensive review of where the legal profession stood in terms of diversity and inclusion and to develop a comprehensive and sustainable plan for the future. The commission, which began its work one year ago, developed policies, online tools, videos, surveys, and templates that collectively have the potential to make a difference in improving diversity and inclusion in the legal profession. The Commission’s work produced 10 deliverables, one of which was a survey that allows clients to gather uniform and consistent diversity data from law firms that can be used by firms to measure their progress and to measure themselves against the competition.

All of the panelists extolled the virtues of the survey and its potential impact on moving the needle in helping law firms become more diverse and inclusive. The survey is the focus of a proposed ABA resolution, 113, which is scheduled to be voted on during the House of Delegates session at the Annual Meeting. Resolution 113 reads: “Urges all providers of legal services, including law firms and corporations, to expand and create opportunities at all levels of responsibility for diverse attorneys and urges clients to assist in the facilitation of opportunities for diverse attorneys, and to direct a greater percentage of the legal services they purchase, both currently and in the future, to diverse attorneys.”

“With passage of this resolution, I hope that general counsels will use the model survey that we have prepared and I hope they would commit to the following three things: use the survey to see how they look as a company in terms of diversity and inclusion; use the survey for any new potential firms they may be looking to do business with and how they’re doing with diversity; and third, in terms of firms not making progress, terminate these firms based on their lack of diversity.”

Art Chong, retired executive vice president and general counsel and secretary of Broadcom Corporation, said of the survey is that it “initiates that inevitable race between race and greed. Fear on possibly losing business and falling behind because you don’t have diversity and inclusion and greed in terms of getting more business if you advance diversity. One of the things the law firms have been heretofore immune from the economic consequences of not being diverse. This resolution is a very significant first step in that direction.”

“Fortune 500 General Counsel sharing the 3Cs of Diversity & Inclusion – Commitment, Candor and Collaboration” was sponsored by the ABA President’s Diversity & Inclusion 360 Commission in conjunction with the Center for Racial & Ethnic Diversity, Coalition on Racial and Ethnic Justice, Commission on Hispanic Legal Rights & Responsibilities, Commission on Racial and Ethnic Justice in the Profession, Council for Racial and Ethnic Diversity in the Educational Pipeline and the Commission on Sexual Orientation and Gender Identity.