Law Firm Diversity—Best Practices for Firms and Companies That Hire Them

By Kristin Casler and featuring Frederick R. Nance of Squire Patton Boggs

Since 2003, the National Football League has enforced the Rooney Rule, which requires teams to interview minority candidates for all head coaching and senior operations jobs. On February 4, the NFL announced that it would expand the Rule to require interviews of female candidates for executive positions. This begs the question—if the NFL can do it, why can’t the legal profession?

“We have collectively been talking about diversity for a very long time, yet none of us is satisfied with the progress to date,” said Frederick R. Nance, regional managing partner at Squire Patton Boggs. He noted that the percentage of African Americans, for example, who are law firm partners hovers around 2 percent; for women it is about 17 percent.

“There are many complex reasons about why that is the case. However, in the world of large law firms, the values which prevail are those that are adopted and supported by our clients,” Nance said.

Nance, who has been on the front lines of diversity advocacy for almost 40 years, said that since client relationships are the coin of the realm in law firms, then clients hold the power to change diversity trends. Companies should consider making it very clear to their law firms that they mean business on the topic of diversity.

Of course, general counsel do not operate in a vacuum. Quality, value and fit are all part of the counsel selection equation. Moreover, general counsel alone cannot hold a law firm accountable for diversity. That direction and authority has to be shared in the executive suite, Nance said. “So, if we truly wish to do more than simply talk the talk, visibly adopting diversity as a legitimate component of the value equation and holding law firms accountable for their performance in that area has to be supported in executive suites all over America,” Nance said.

What Companies Can Do

The culture of every company is different. But most companies espouse diversity. So it is not out of bounds for a general counsel to walk into the executive suite and say, “Are we serious enough about diversity as a priority to do the things that will cause outside counsel to change their hiring, promotion and assignment-of-responsibility practices? Are we willing to do the things necessary to make it go?”

Nance said he is not suggesting that this is an easy thing to do, but empirical evidence shows that without such commitment and follow-through from clients, the status quo will largely remain.

One best practice is for a company to look at the top three to five lawyers charging time on its account. If there aren’t diverse lawyers in that group, the company could insist, over a reasonable amount of time, that that changes, Nance suggested. A company could tell its outside firm that it has a year or 18 months to change those numbers or face consequences.

Nance pointed to the NFL’s Rooney Rule, which forbids hiring a coach or anyone at the executive level, even on the business side, without at least interviewing a diverse candidate. The Rule could be applicable in some form in the legal industry, he said.

Now, the Rooney Rule does not assure the hiring or promotion of diverse candidates. But it does afford opportunities—opportunities for diverse candidates to showcase their talents and to connect with people who can help them capitalize on those talents. And, if, for instance, a client insists that diverse lawyers be included among the firm attorneys performing most of its work, then there’s the opportunity for those diverse lawyers to gain the client’s confidence and to develop the kinds of relationships that could later lead to greater responsibility inside the firm for that client,” Nance said. That, in turn, would incentivize law firm behaviors that could one day dramatically improve the large law firm diversity landscape.

What Law Firms Can Do

For better or worse, the reset resulting from the 2008 recession accelerated the legal profession’s evolution toward a hyper-competitive, market-driven industry. Nance noted that when he began practicing, hiring and advancement were largely based on an assessment of a candidate’s intrinsic capabilities as reflected by educational pedigree, test scores, perceptions of analytical ability, and ultimately, the quality of work. Today, there is an oversupply of talented, capable lawyers to do the work and not enough clients with the high-end work most firms are seeking to go around. Nance said that ultimately, the key for the competing firms is the ability to form the relationships that result in significant client work. The people who can attract clients have become very valuable at law firms. For women and minorities, the opportunities to develop those kinds of relationships are harder to come by, Nance said. They often lack the social, professional or even family connections that can generate firm business.

“If you’re going to do something about diversity, you’ve got to bring women and minorities into important client relationships in a meaningful way,” Nance said. “That happens today, but it’s taking place very sparingly.”

Law firms can and should give diverse attorneys the opportunity to get out of the office to pursue those relationships, or include them in groups or social situations where they might be able to make those connections, Nance said. Firms should consider mentoring and reward structures and a demonstrated commitment to professional development for its diverse lawyers.

And, naturally, lawyers need to take advantage of these opportunities. Progressing from associate to partner is no small undertaking. You have to be devoted 100+ percent. Not everyone is willing to take risks or make the sacrifices necessary to be successful in their legal career in this market, Nance said. And for minority attorneys who see few if any successful role models in the stream ahead of them, it can be particularly daunting to plow ahead thinking they will be the one who is different. Then, Nance said, lack of diversity becomes a self-fulfilling prophecy. He believes that leadership from the highest levels at the clients that the firms are competing to represent can dramatically change that equation for the better.