By Isabel Parker
Whilst the business world has been investing substantial energy on issues such as ESG, purpose and culture, law firms, in the main, have not.
Most large law firms have developed an advisory proposition around ESG – but that’s telling others how to do it, rather than doing it yourself. I am not talking about taking actions like reducing the firm’s carbon footprint or donating money for reforestation (all good initiatives, so far as they go). I mean devoting serious time and energy to reframing the law firm’s purpose to serve stakeholders beyond the firm’s partners, i.e. associates, non-legal professionals, clients, suppliers, law students, society at large.
(There are exceptions; Mishcon de Reya recently became the third law firm in the UK to achieve B Corp certification – a truly impressive achievement).
The question is, why should law firms bother?
Most large firms have profited through the pandemic and continue to thrive economically. Salaries are increasing, the lateral hire war continues, PPP is on the up. As 2022 approaches and we emerge into what we hope will be a brighter future, law firms might argue that there is little need for introspection. Could continued economic success be an indicator that law firm cultures are healthy – and quite purposeful enough, thank you?
Maybe. But consider the recent revelations in the legal press that leading UK law firms have been using photographs of black and ethnic minority lawyers in pitches to sell the firms’ diversity credentials, only for those lawyers to be passed over when it comes to delivering the work.
Or consider the high incidence of burnout, mental ill-health, low levels of autonomy and low levels of psychological safety amongst legal professionals, as reported in the LawCare Report Life in the Law 2020/21.
Both these situations – using racial identity for profit and fostering a burn-out culture that damages employees’ mental health – are blatantly wrong. Are they also indicative of a wholesale degradation of culture in some law firms? Possibly – but (acknowledging that as a white, middle-class, cisgender woman it’s not my call to make) I think it unlikely. Rather, these examples demonstrate that culture in some law firms has lost its way. A conscious and deliberate focus on purpose is needed to redress this issue.
The New York Federal Reserve recently released a podcast series as part of its initiative to drive cultural change in financial services. Called ‘Banking Culture Reform: Norms, Mindsets and Decision Making’, the series features interviews with diverse individuals, including a neuroscientist, an organisational psychologist, and the Chief Flight Director at NASA. The series demonstrates the financial services sector’s willingness to learn from other organisations, by studying how they define purpose, how they build culture and how that culture affects decision making.
The parallels with legal services are striking. Granted, lawyers are not generally gamblers and risk takers. The profession tends not to produce highly charismatic individuals (‘rogue traders’) who lead others into unethical excesses. However, as Mark Mortensen, Associate Professor of Organisational Behaviour at INSEAD explains in the podcast, cultural degradation doesn’t happen in organisations just because of a few bad people doing really bad things.
Even in organisations made up of professionals who consider themselves to be highly moral and ethical, exogenous pressures (to be made a partner, to make the firm successful, to win a pitch, to poach a lateral) can cause those same professionals to act in ways that they would abhor outside of the workplace.
In the podcast, Taya Cohen, associate professor of organisational behaviour and theory at Cargenie Mellon’s Tepper School of Business, defines corporate purpose as a shared sense of responsibility towards a broad set of stakeholders (not just those that profit financially from the organisation’s actions), combined with a long-term view of value creation.
She observes that in financial services (as in any high-performing context where the stakes and the salaries are high) absent a sense of purpose, the workplace can become divorced from reality. Instead, work takes on the qualities of a game, with its own localised rules, that don’t apply in the real world.
Cohen calls this ‘gameframing’. Gameframing is dangerous because it gives otherwise ethical people licence to behave in ways that are unethical when they are at work. If we reflect on: (i) the often adversarial nature of the client work lawyers are engaged in, in which winning and losing are critical; (ii) the widely reported challenges that many in the legal services sector face in bringing their full selves to work; and (iii) the homogeneity of human culture that defines large corporate law firms in particular, the concept of gameframing starts to resonate.
How to address this? There is a tendency in some law firms to default to making rules, rather than investing in nurturing genuine cultural change. It’s easy to see why: lawyers like rules, and are generally pretty good at sticking to them. But organisational rules cannot in themselves create a culture, and you can’t rely on rules to drive ethical behaviour. Rules are static, but culture (‘how people behave when no one is looking’) is organic, it evolves to meet changing circumstances – it is intrinsically nimble.
To demonstrate what I mean, let’s apply the rules versus culture analysis to the two examples of unacceptable behaviour I referenced above. The rule for inclusivity in pitches might be: ‘We shall satisfy our clients’ demands for greater diversity by always seeking to include an ethnic minority lawyer in the pitch document.’ Well-intentioned perhaps, but ultimately meaningless. The corresponding purpose or cultural change would be: ‘Redress inequalities in access to the legal profession by recruiting, retaining and nurturing diverse talent and providing opportunities for it to flourish.’
In respect of burn-out culture, the rule might be: ‘Only those that work 1,900 billable hours per year shall receive a bonus. There shall be no minimum hours target.’ The objective, presumably, is to ensure no one is disadvantaged by having to work unreasonable hours. However, from a cultural perspective, this rule does not serve its purpose. The corresponding purpose or cultural change would be: ‘Reward people for working to achieve client outcomes in the most efficient way, always respecting the wellbeing of other team members.’
These are just two small examples of a much larger issue. Culture is nuanced, and complex, and genuine change takes time and deliberate effort. Lawyers tend towards verticals: we have created ‘legal tech’; ‘legal innovation’; ‘legal transformation’; ‘legal ops’.
It’s time to think more expansively. Law firms should follow the example of the New York Fed. As purpose becomes an ever more pressing imperative, they should seize the opportunity to shrug off the wig and gown of lawyer exceptionalism and learn from others.
About the Author:
Isabel Parker is Executive Director at the Digital Legal Exchange and has a focus on helping corporate legal teams accelerate digital transformation. She is the author of ‘Successful Digital Transformation in Law Firms: A Question of Culture’, and was previously Chief Legal Innovation Officer at Freshfields.