The Answer: Pay for it.
Recently I saw a marketing email from a company that sells its services to in-house legal departments. It was titled something like “Steps to Improve Diversity.” To be honest – I didn’t read it. However, this topic has been top-of-mind for me for some time now so it generated this post.
More and more clients are implementing Diversity and Inclusion (D&I) programs in order to get their firms to not only hire diverse lawyers, but also to make sure they are engaged on that client’s work. These programs range from rewards (e.g. bonuses) to very punitive ones (a.k.a. You’re Fired).
Of course this is a highly laudable goal, but it is proving to be quite challenging to implement and report on. There are limited standards in the market for what constitutes “diverse” and each client has some variation on what is included and not. As well, clients are asking for more and more complicated diversity reporting. For example, one client recently asked for a full report not just on the work being performed on its behalf but also on D&I at all levels of its outside firms. The result is that D&I teams at firms are spending a considerable amount of time responding to surveys, versus implementing D&I programs.
[A side, but relevant note to clients: Clients keep adding required work to the list that they want done for free by their firms. They should realize they are driving up costs for their partner firms.]
So you might think the moral of this story is that clients should give bonuses to their firms for meeting and exceeding D&I goals. It’s not. It’s actually something more useful and ultimately better for diverse lawyers. If clients truly value D&I they should pay full rates for the lawyers they qualify as diverse. I can tell you if they do that, not only will law firms respond actively, but they will be promoting and advancing the careers of these diverse lawyers.
Currently a lot of the clients pushing for diversity are also pushing for bigger discounts and lower rates. Given that diverse lawyers are a limited resource, by doing this they are driving an unintended consequence. This consequence means diverse lawyers are realizing lower effective rates for their work. And the result of that is diverse lawyers are actually having their careers negatively impact by these actions due to reduced economic performance.
With a growing number of clients requiring diversity in their work, law firms are running out of diverse lawyer resources to meet those demands. At a point, they will be driven to focus those resources on the clients that truly value them.
So … back to my main point. Clients – if you value diversity, pay for it. You will meet your goals and you will directly be promoting the hiring, retention and advancement of diverse lawyers across the spectrum.