Tackling “Tokenism” in Legal Departments and Law Firms

(It’s Not Just a Virtual Currency)

The past few years have seen an unprecedented transformation in the diversity policies and initiatives of corporate legal departments and law firms. While there is hope that such policies, which are more data-driven than ever before, will help accelerate minority representation, the attrition rate among minority attorneys, particularly junior attorneys, continues to be high. How can legal departments collaborate with outside counsel to ensure diverse talent is supported and provided equitable opportunities to succeed?

A rising tide lifts all boats, but does it really?

According to a 2017 law firm diversity survey conducted by Vault and the Minority Corporate Counsel Association, minority representation in law firms is at a record high, with minority lawyers representing 16% of law firm associates, partners and counsel. Progress is most evident among incoming associate classes; 31% of second-year law students who summered at law firms in 2016 and accepted offers to return as full-time associates in 2017 were members of racial or ethnic minority groups, up from 25% a decade ago. About half of all summer associates in 2016 were women, who also made up 44% of entering law firm associate classes, and 4.6% identified as LGBTQ, compared to the 2.5% of all law firm attorneys. Data and reporting constraints still hamper effective tracking and reporting of attorneys with disabilities.

While we have hit a stride, true change takes time, and nowhere does this ring truer than in the legal profession. Minority representation in law firm partnerships, for example, has increased on average 2% since 2007. However, equity partnership – the long-lauded brass ring of private practice – remains stubbornly whitewashed. More than 90% of all equity partners are white. Only one in five equity partners is female. While Asian-Americans are the highest represented minority in equity partnership, they clock in at just 3%. Latino partners make up less than 3%, and African-Americans less than 2%. Women of color comprise only 3% of equity partners, and multiracial partners constitute just .5%. As of 2016, less than 2% of equity partners were openly LGBTQ.

Although many firms have made laudable steps toward attracting diverse talent, they often struggle with retention. While diversity in overall attorney headcount is on the rise, the gains are often uneven, and attrition among minority attorneys is higher now than it was during the recession. In 2016, 22% of all attorneys and 27% of associates leaving firms were minorities, exceeding figures reported in any of the previous 10 years. Not only do these departures choke the pipeline for diverse representation in leadership roles, they limit the number of role models and mentors available to junior associates, further accelerating the cycle.

Diversity programs must focus on junior attorneys

Despite being sincere in their commitment to advancing diversity and inclusion, many law firm leaders are unfamiliar with the barriers that minority attorneys face. Often, the easiest approach is to write a check to sponsor a table at a minority organization gala or sponsor a couple of attorneys to attend a diversity event. However, these efforts are not substantial enough to provide minority junior associates the support they really need. So, what can be done to prevent minority attorneys from leaving firms, and how can legal departments take a more active role in encouraging outside counsel to move the needle on diversity?

Here are three ways that corporate legal departments can collaborate with their outside counsel to ensure minority attorneys are supported and given equitable chances to succeed:

  1. Work with firms to identify minority mid-level associates in their third through sixth year of practice to place directly on company matters. Ensure minority junior attorneys staffed to your teams have meaningful opportunities to contribute and that they are not victims of tokenism. Demand these junior attorneys take a lead in pitching your work and ensure they receive credit for their efforts. Within firms, establishing formal or informal mentoring programs with the goal of developing strong, one-on-one relationships with associates is also important, provided it leads to substantive, skill-building assignments designed to place associates in a stronger position to become partner.
  2. Put money on the line. Reward or discipline outside counsel for exceeding or failing to meet your diversity goals. There are numerous examples of companies that have doubled down on firms by withholding portions of invoiced fees or paying bonuses based on ability to meet diversity goals. Others have begun using surveys and other data to rank firms on their outside counsel list against one another, adding or removing firms according to their scores. Such policies have the potential to become truly impactful because they encourage firms to increase diversity or risk a hit to their bottom line. If you disengage with a firm or diminish workload based on such data, make it clear that they did not meet your diversity expectations.
  3. Commit a portion of your legal spend to hiring ethnically diverse or LGBTQ outside lawyers to serve as lead counsel on select matters and require that minority associates participate in pitching work. Companies can require firms to certify that the lead lawyers, and particularly associates, receive some kind of credit as originators of the matter, in addition to being staffed to the matter going forward.

It's important to reiterate that one of the most powerful tools companies have is the ability to demand outside counsel take measurable actions to increase representation of minority attorneys who work on their legal matters. Companies can and should track their outside counsel’s progress with the same dedication they would put into tracking a litigation budget, delegating work accordingly to firms that meet or exceed targets and withholding work from those that fall below expectations. If your legal department doesn’t have the resources or legal operations capacity to develop and track diversity programs in-house, partner with legal organizations that have programs directed at mentoring high-potential diverse associates, such as the Leadership Council on Legal Diversity’s Pathfinder and Fellows programs.

At the end of the day, clients should rely on their outside counsel as partners in making a positive impact on the legal profession. Clients are in the best position to influence firm diversity by requiring minority attorneys have a seat at the table, both in the courtroom and during important corporate transactions. Despite recent baring of more teeth in diversity programs, many firms and corporate legal departments run a high risk of falling prey to tokenism if those programs do not focus on developing and retaining a more robust cadre of talented, diverse lawyers. Younger attorneys only benefit from diversity programs if those programs provide them with meaningful opportunities to lead, encourage them to stay, develop their own practices through meaningful billable opportunities, and advance within their firms and the profession.

My advice for corporate legal departments looking to move the needle on diversity? Demand that diverse junior attorneys take a lead in pitching your work. Demand that they receive credit for their efforts. Put money on the line: reward or discipline outside counsel for exceeding or failing to meet your specific diversity goals. Track and follow up on diversity data and hold firms accountable; if you disengage with a firm or diminish their workload based on such data – tell them. If you pull work from a firm because the team did not meet your diversity expectations, make this point clear. Do not simply mentor junior associates. Give them meaningful, billable work, then demand they take a leadership role in your success.

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