CSR Governance in law firms

Part 3 in the series CSR and Lawyers

What do law firms need to do when it comes to CSR? Read on…for more on CSR Governance in Law Firms.

This is the third in a series on CSR and lawyers. The first two investigated the distinctiveness of lawyers and an example of a quite different law firm. This post looks at governance of law firms and how ‘normal’ governance models interact with good CSR.

Law Firm business model

David Maister, long regarded as a guru of law firm management, holds that law firms are basically a network model. Which means that for every one person at the top, there needs to be quite a large number of people below that person. David Maister often refers to the challenges of governing law firms and highlights the tension between management driven from the individual autonomy and power of partners, and other styles of management. Much of this article aligns with his thinking.

Governance in Law Firms

As knowledge-driven organisations, law firms rely on the skills and knowledge of their people in order to sell their service (or product, although most law firms resist the notion of productisation of any of their legal services/products). Sharing knowledge should be a key part of business activity because (in theory) it would reduce costs of doing business if done well. Some law firms have successfully moved toward cross-functional team-based engagement with clients, but it is still relatively rare. Even the firms that do have cross-functional teams, it is usually still quite formal and the exception rather than the rule.

The heritage of law firms lies in vigorously defended personal (partner-level) autonomy. So the levels of trust needed to ensure cost efficiencies are perceived as (or actually) at odds with autonomy and the level of control that partners are accustomed to. It is still relatively rare for large law firms to have formally constituted management committees that have clearly defined areas of autonomy. Notionally such authority is ‘given’ by vote to the usual management dyad of Senior Partner and Managing Partner, but such authority is usually very easy to remove and such positions usually can’t make decisions without approval of the full partnership (or the opportunity to be overturned). Those things makes their roles inherently moderate and highly political – unpopular decisions aren’t made easily and popularity is often decided by how the partners (still usually overwhelmingly males) perceive it will affect their interests.

[For more on the nature of the relationship that the SP/MP dyad has with their firms, see Managing Partners and Management Professionals: Institutional Work Dyads in Professional Partnerships.]

Partner autonomy makes discussions about brand and firm-level distinctiveness very difficult. Presumably that’s because agreeing on any kind of brand distinctiveness will mean a reduction in certain kinds of legal advice – ‘We advise our clients on what they need’ isn’t distinctive, its what almost every law firm does. So each partner presides over their own ‘fiefdom’ and, like any good feudal leader, fiercely defends their territory (including, and perhaps especially, against other leaders). The ‘Fiefdom Syndrome‘ isn’t unique to law firms, but it is especially common.

Democracy in Law Firms

Law firms are, at one level, the most democratic of organisations. Each Partner gets a vote on most of the decisions that affect the firm. But at another level, they are barely democratic at all. Most people in the organisation don’t have any voting rights which means their interests may not be effectively considered by partners when casting their vote. Of course there is no formal structural reason why Partners couldn’t vote to do things that advantage others, but there is also no formal structural reason why they will.

Someone I know (who used to be a lawyer) has a consultancy that provides coaching to lawyers to help them become better lawyers. After years of trying, that person now focuses on lawyers who work within large corporations and refuses to work with law firms on the basis that the biggest beneficiaries of decisions are partners, and they generally do whatever is good for partners and have no incentive to make it easy for anyone to become partner. David Maister quotes a former managing partner as follows:

“Most partners were recognized and rewarded for being the smartest person in the class or the most accomplished. They have rarely experienced or understood the power of succeeding as part of a larger group or team. Their focus tends to be selfish and self-serving, even narcissistic.

                     The result is that the firm resources are squandered and poorly used, clients don’t get the best lawyers assigned to their files, and firms are less profitable. This selfishness also leads to a shortsighted approach to decision making that inhibits long-range success because investments of time or money that don’t yield immediate results are rarely made.”

Structuring CSR Governance in Law Firms

All that to recognise the challenges of integrating CSR into management of law firms. And also to say of all the CSR professionals I have met, those who have brought about significant change in law firms are some of the most resilient, robust and politically astute – and all have relied on a broader team of CSR ‘believers’. Such believers are corralled into a Committee that advocates for CSR change. Representation on successful CSR committees has been broad (often the broadest of any committee within a firm), with various levels represented (including partners) and with good influencing skills within.

Top Tips

There isn’t any one model of Governance that will fit any given law firm, but there are some common features that are worth noting:

  1. The Management dyad is represented on the Committee or (as a second best option) the Committee reports directly to either (or both) of the Managing Partner and Senior Partner.
  2. Business functions are represented, including:
    • Facilities
    • Operations
    • Human Resources
    • Risk
  3. Various levels are Represented, including:
    • Partners
    • Associates
    • Lawyers
    • Trainees
    • Business Management
    • Support staff
  4. They have clear remit to report directly to Partners on broad CSR issues
  5. They are obliged to create targets for CSR performance
  6. Members are passionate about CSR

Of course the better firms have some autonomy on setting targets on CSR goals, but any autonomy is usually subject to review by Strategy or Management Boards. In any case, autonomy on certain issues should be the goal of any CSR Manager in a law firm.

That looks like a rather short list of Top Tips, but it is often remarkably difficult to implement. Wise CSR professionals will invest some time understanding the political landscape, using things like Power Mapping (below). Knowing the scale of influence that you have to exert (especially on Partners) won’t make the task look any easier, but it will help to plan for success on change based on CSR.

Simple Power Map

For a further prompt on leadership and CSR in law firms, see Heidi Newbiggin’s article, What does Responsible Business mean in the Legal Sector.


If you want to more about management of law firms, David Maister asks, “Are Law Firms Manageable?“.

 

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