Data and diversity: law firms must adapt to survive
Legal Geek - 08/06/2021

They are among the most critical challenges facing every law firm – data and diversity. In addressing them, two existential questions arise: how can law firms master the enormous quantity of data at their disposal and make it integral to what they do; and how should they incorporate diversity into their culture so that it defines who they are.  

The answers are far from straightforward. To effect genuine cultural change is laborious: the bigger the organisation, the harder the task. But if they seek a starting point from which to build, law firms first need to learn to love data and diversity. And fast. In practice, that means fully embracing them and not simply producing worthy, but bland PR statements about innovation, or setting diversity recruitment targets several years hence.  

Law firms which fail to recognize data and diversity as genuine opportunities to meet their clients’ current and future expectations will be left behind, allowing their competitors to move ahead. It’s a matter of adapt to survive. 

Set against these self-evident truths is the inherent conservatism of most lawyers, which is regularly quoted by speakers at Legal Geek events. Law firms accept that they tend to follow where others lead, more often dealing with issues as they arise rather than anticipating them. 

Legal Geek North AmericaDigital innovation

But some are keen to shed their image as a lagging indicator of change. They know what is said about their use of data and its symbiotic twin, technology: that they look sideways rather than ahead. Although every law firm uses technology and stores data, pioneers do exist at the cutting edge, providing a strategically data-driven service to their clients that keeps them ahead of the pack.

 In exploiting data to gain competitive advantage, a growing number of law firms appreciate that their lawyers need to work closely with technology of the future. Allen & Overy’s Fuse innovation hub is perhaps the better-known example. Now four years old, it is well-established as a place where tech companies, A&O lawyers, technologists and their clients can collaborate. Barclays Eagle Labs has a similar objective, on a bigger scale, bringing together startups, investors and corporates, combining ‘hyper-collaboration’ with ‘keeping it simple.’

Now in its fifth cohort, Fuse is focused on FinTechs, giving them access to A&O lawyers’ knowledge and, in turn, enabling A&O ‘to develop a deeper understanding of FinTech and our clients’ financial services and digital transformation strategy.’

Professor Richard Susskind OBE

Ideally, every law firm should inculcate its lawyers with an informed world view that focuses on the future use of data and the technology that underpins it. Sit down with Professor Richard Susskind and he will tell you that the real challenge for the legal sector is how best to use technology in order to change the way it delivers services and do things that were not previously possible. Transformational technology does not support or enhance our current ways of working, he argues, it disrupts and displaces them. 

“I want to challenge lawyers to understand the potential of technology and use it,” says Susskind. “Not simply to preserve twentieth century legal practice, but to redefine the way that legal professionals can help their clients. By legal professionals, I don’t just mean traditional lawyers, I mean people who are legal technologists, legal process analysts and legal knowledge engineers.

 

Young lawyers need more training in tech

Beyond the development and adoption of technology that enables law firms to undertake processes faster and cheaper, the day-to-day reality of the individual lawyer advising their clients increasingly centres on data delivered by it. At a granular level, lawyers should ideally feel as confident analysing stats and quantifying risks as they do drafting contracts and preparing agreements created by assorted systems at their disposal, most of which come from third-party providers.

 Yet this ideal does not always appear to be not matched by reality. Although this is not something we have seen at Legal Geek events, findings from a 2019 survey by the Law Society of England & Wales led the Times to run a headline: Young lawyers can be most technophobic.

According to the survey, junior lawyers are oblivious to the increasing role of technology in legal services. Half of the 224 respondents said they did not know what LawTech was, let alone that it is a $20bn global industry. Notably, three-fifths of respondents reported that while studying to qualify as a lawyer, they received little or no information or training about LawTech, while just two percent felt they had received all the information and training they needed.

We don’t think this is reflective of the Legal Geek audience, but it is interesting nevertheless. It is only one survey, conducted two years ago. But the data speaks for itself: many young lawyers feel starved of the tech training they need to flourish. Without it, their data skills fall woefully short. 

The New York State Bar Association (NYBSA) certainly recognises their need to understand technology and how to use it. Last November, NYSBA designed and taught semester-long tech classes at CUNY Law School, Syracuse College of Law and Albany Law School, becoming the first US bar association to teach an entire law course on technology. Legal Geek also has an upcoming event that addresses future tech skills and career paths for students and junior lawyers.

Lawyers also need to feel comfortable with the data provided by their clients and in analysing independent data that helps them to give advice that is both commercially and legally useful. One example often spoken about might be the use of predictive analytics to provide a client with a percentage chance of success in a litigation matter. Here, whatever the data analytics might suggest, some recalibration may be needed: to distinguish between the commercial and legal risks, and to provide a judgment based on experience of previous comparable litigation. Interpretation of such data is critical.  

Ultimately, lawyers’ primary skills lie in the written word and that is likely to remain the case. But a well-developed facility to understand, use and interpret data for a client is also increasingly necessary. Their overall skillset may vary, but the O shaped lawyer – a well-rounded individual whose core competencies include being able to understand, analyse and interpret data – is what many clients now expect as a matter of course.  

Diversity Matters     

Stephanie Boyce, President, The Law Society

 Equally, the drive for diversity has been given fresh impetus by last year’s tragic events in Minneapolis. “What the death of George Floyd and the subsequent Black Lives Matter movement has done is to bring to the fore the systemic inequalities that exist,” says Stephanie Boyce, the first Black woman to become President of the Law Society of England and Wales in its 196-year history.

“It’s made us take a look within our own homes, our metaphoric homes, as to what is going on,’ she says. “Some of us have had to ask ourselves some really soul-searching questions about some of the systemic inequalities that exist within all aspects of our society. Sadly, the legal profession is no exception to that. Racism in the workplace is often subtle, it results in unconscious or implicit bias in the culture, policies, or processes.”

 Boyce suggests that the legal profession “needs to use this time to investigate, to listen and to identify the actions we need to take to build a more inclusive profession. This must be a profession, where regardless of your background, your gender, your sexuality, your colour, your race, your age – any of those characteristics – the determinant must be: ability, aptitude, and nothing else. It must be a profession that welcomes everyone, and really, truly provides for equality of opportunity.” 

Clients demand change

Louise Pentland, Chief Business Affairs & Legal Officer at PayPal

As law firm clients lead the drive to become more diverse, inclusive organizations, they are pushing their outside counsel to do the same: they want to be advised by diverse teams of lawyers who reflect their employee profile and the markets in which they operate

Louise Pentland, Chief Business Affairs & Legal Officer at PayPal in San Jose, is one such client. “There’s a responsibility to drive change because that change isn’t going to be homegrown in these big law firms – they’ve been at it, quite pathetically, for years,” she says. “I still hear from these firms who parade diversity numbers of 20% or 25%, telling me all the reasons why it’s hard, instead of focusing on striving for 50%.”

She develops the point: “I have great diversity in my team – men, women, ethnic backgrounds. We were culturally raised differently. We come at things differently, we look at problems differently, we look at solutions differently, and that’s the real mix that you need for really great decision making.”

Pentland concludes: “One thing I’m very focused on at PayPal is picking law firms that really emulate our company’s values – diversity and inclusion. We really seek to drive change in law firms that haven’t woken up to what’s needed and what their clients want, which is much, much, greater diversity. It’s not about just having statistics: diversity brings better results. End of discussion. Why wouldn’t you want that? I’ve met a lot of firms – some are trying and some are telling me they’re trying. Big law firms have an incredible way to go.”

 

Big Law delivers

Some have certainly made big strides. Last September, Freshfields Bruckhaus Deringer appointed Georgia Dawson as its next senior partner – the first Magic Circle firm to appoint a woman in this role. Next month, Aedamar Comiskey will become the second as the new senior partner of Linklaters. 

One firm among several where diversity appears to be a genuine priority is Bryan Cave Leighton Paisner (BCLP). “What I really hope comes across here is that BCLP’s commitment to inclusion and diversity is authentic, extensive and supported at the very highest levels in our firm,” says Justine Thompson, the firm’s Head of Inclusion & Diversity, EMEA & Asia.

Evidence of that commitment can be seen in the firm’s management team: in 2018, Lisa Mayhew and Therese Pritchard were appointed as co-chairs – making BCLP the first City law firm to be jointly headed by two women – while Segun Osuntokun became London managing partner: the first Black man or woman to be appointed to such a role in a big City law firm.  

Thompson explains the BCLP culture. “We strive every day to create an inclusive workplace where every individual feels celebrated for their difference, can be themselves and can contribute meaningfully to BCLP’s success.  Our Inclusivity and Diversity mission is: to unleash and nurture the power of inclusion, belonging and diversity as a habit, not an initiative and to create an environment where all in the firm feel valued, respected, celebrated and able to reach their full potential.”

Striving to achieve a diverse and inclusive workforce is of course the right thing to do, she adds, but it is also a strategic, business priority for our firm.  “A number of studies show not only that the business case for diversity remains robust, but that the relationship between diversity on executive teams and financial outperformance has strengthened over time,” says Thompson. “We believe that diversity enriches the quality and fabric of our culture and makes us a stronger, better firm.” 

Although these sentiments have now finally gained widespread traction, the data confirming their commercial value was reported in a Mckinsey study as far back as 2015.

The diversity drive will persist until every law firm office becomes indistinguishable from the world outside by including people of disparate cultures and backgrounds within them. Clients provide a key intersection between the two: they expect their lawyers to be confident with data and comfortable with diversity. Fall short on either count and they will move their business elsewhere.

 Ultimately, the commitment to data and diversity is driven by recognising the fundamental need to embrace change. Although the Origin of the Species is among the most quoted texts at Legal Geek conferences, it is with good reason. Darwin’s central message remains valid: ‘It is not the most intellectual of the species that survives; it is not the strongest that survives; but the species that survives is the one that is able to adapt to and to adjust best to the changing environment in which it finds itself.’ That every law firm needs to adapt and adjust in order to survive is beyond question.   

Written by Dominic Carman

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