As corporations launch new legal diversity programs for their external counsel, will it spark more corporate law departments to address this issue?
Earlier this year, Coca Cola’s new Global General Counsel Bradley Gayton announced that his team will require law firms working on new matters for Coke to ensure that “at least 30% of each of billed associate and partner time will be from diverse attorneys, and of such amounts at least half will be from Black attorneys.”
The move by a major global corporation like Coke to make specific demands about the make-up of its selected outside counsel brings up a finer point about the critical role corporate law department operations (LDO) staff can play in the execution of a legal group’s diversity, equity & inclusion (DEI) strategy.
In a new three-part blog series, we want to examine how the growing demand for corporate law departments and outside counsel to collaborate on specific targets in racial and ethnic diversity has made the role of LDO professionals indispensable in the execution of a comprehensive DEI strategy.
First, at a minimum, LDO professionals need to prioritize the essential elements of an all-inclusive strategy, which includes:
- developing a DEI policy and having it reviewed and approved by law department leadership;
- staying current on what peer companies are doing around DEI and the larger trends underway, such as use of the Mansfield Rule, which is currently available in adapted form for law departments;
- gathering key metrics to measure the impact of their departments’ DEI programs; and
- creating guidance for department lawyers on how DEI can be used as a lever when selecting outside counsel.
Unfortunately, many corporate law departments still are perceived as mere cost centers, and most are being pressured to do more work with fewer resources. This is where the LDO professional can add tremendous value, according to David O’Connor, Senior Legal Editor at Thomson Reuters Practical Law. O’Connor formerly oversaw legal matters for the U.S. commercial operations at QVC. Examples of this added value include:
- Leading internally as a DEI champion — With the corporate legal department’s reputation inside an organization often being the Department of No, having an LDO manager aggressively pursuing a DEI strategy is an excellent way to change this perception.
- Embedding DEI into the operation of the legal department — LDO professionals also can help embed DEI practices into the department’s day-to-day activities. Because the LDO professional or team is already executing in other areas of the department, they will naturally see the best opportunities to implant DEI into existing processes and procedures, such as e-billing, matter management, and knowledge management. For example, using the American Bar Association’s uniform task billing codes in the company’s e-billing system to track the level of work that diverse outside attorneys are doing allows the team to use an existing system to achieve a new DEI goal.
Tips for smaller legal departments
Bandwidth constraints in a smaller legal department that may have only a handful of lawyers and staff — and no dedicated LDO manager — can limit the department’s ability to establish a DEI program. By working through internal and external partnerships, however, establishing a program is still possible. Here are some key steps:
- Work with internal functions — O’Connor recommends partnering with the organization’s DEI, HR, and communications teams to help the law department create a strategy, develop and collect metrics, and market the program internally. Corporate law departments that leverage what the larger enterprise is doing can reduce some of the workload of implementing a department-wide DEI program.
- Collaborate externally — There are opportunities to leverage legal functions at peer companies to help avoid starting from scratch. In addition, external organizations that support corporate law departments — such as the Association of Corporate Counsel and the Corporate Legal Operations Consortium — offer standard and common elements of DEI programs, such as diversity policies and outside counsel guidelines. Likewise, other organizations like the National Association of Minority and Women-Owned Law Firms can help identify minority-owned law firms that can then diversify a department’s network of outside legal service providers.
You can’t manage what you don’t measure
Finally, there is a large gap between the perception of what general counsel say that they are doing to improve the profession’s DEI profile, and what they are actually accomplishing. For example, there have been two open letters (this one and this one) from general counsel in recent years that strongly encouraged their outside law firms to prioritize DEI, yet, there is no publicized central effort to measure what the signatories are actually doing to reward those firms that prioritize diverse talent when the GCs actually select law firm for key matters.
“I think it’s very fair to say that law departments have not traditionally done a very good job at moving the needle, other than collecting DEI information from their firms,” O’Connor says. “It’s been a slow process, but I do think it’s changing.” Indeed, there has been increasing pressure applied by some corporate law departments on their preferred external firms to ensure that firm associates from diverse backgrounds are given the same opportunities as non-diverse associates to ascend to leadership, supervisory, and management roles. Some departments are also requiring their outside firms assign diverse attorneys to work on their key matters and those attorneys receive fee origination credit.
There is no doubt that the time is shrinking between watershed moments. Let’s hope that this moment, with societal pressure to do the right thing around diversifying the legal profession, turns into a movement among corporate law departments and their outside law firms that results in permanent positive change.