Moving the needle on progress

In no uncertain terms, 2020 has truly been a year of reckoning for the US: Donald Trump is vying for a second term in the White House. Tragic killings of black civilians at the hands of white law enforcement provoke widespread outrage and demands to ‘defund the police’. A deadly global pandemic is ruining lives and upending the economy, and the President suggests intravenous disinfectant may be the cure.

As the year’s events exceed even the sharpest satire, and with the country at its most divided in living memory, to the average onlooker it may appear impossible to envision anyone making inroads to promote tolerance, mutual respect, diversity or inclusion. On the contrary, such widespread discontent has compelled individuals and companies alike to double down on their commitment to equality, take pause to examine their attitudes to race, to gender, and to any traditionally ‘othered’ group in society, and ultimately to take bold and meaningful actions to combat injustice.

The legal industry has been no exception to this call for action, as diversity and inclusion has shifted from a mere extra-curricular endeavour to an unquestionable expectation from colleagues, business leaders, and clients alike. As the last few years have seen the juncture of corporate strategy and social justice go mainstream, is corporate America entering a new era of social consciousness that is meaningful beyond profit and loss? And, if so, how are legal departments playing their part and taking action?

In a series of exclusive interviews, the legal thought-leaders spearheading D&I in the US speak to GC about the new initiatives shaking up the industry, the value of a diverse team, and how minority GCs who’ve paved the way are inspiring the diverse talent of today.

“If everyone is moving forward together, then success takes care of itself.” The timeless words of Henry Ford ring as true today as they did a century ago, a timely reminder that progress is a necessarily collective endeavour.
Indeed, collaboration is the modus operandi of Diversity Lab, the undisputed stalwart and main facilitator of D&I initiatives in the US legal field. As its name suggests, Diversity Lab takes a science-based approach to monitoring and enhancing D&I through the use of metrics, behavioural data, and design-thinking. New initiatives are formulated in ‘hackathons’, with the best ideas then piloted in law firms and legal departments across the country. In the US, D&I has not been approached in such an analytic fashion before; it is this cutting-edge strategy, coupled with a culture of teamwork and collective success, that has law firms and in-house departments flocking to work with the group.

Through a roster of joint initiatives and partnerships, Diversity Lab’s programmes cut across conventional competitive boundaries, ensuring that no matter what path aspiring lawyers take, they will be supported, encouraged, and accepted throughout. Drawing on the success of programmes like the Mansfield Rule (now available to in-house departments from last Summer) and the On-Ramp Fellowship, Move The Needle is Diversity Lab’s latest project.

“It’s our pull-all-the levers, let’s-see-if-we-can-really-make-a-change programme,” says Leila Hock, Diversity Lab’s director of legal department partnerships. “The idea for Move The Needle came about when we were all talking about every struggle that a diverse lawyer has, starting from law school up until maybe they’re managing partner – what are all the struggles and feelings they’re going through? We can’t solve this problem by focusing on one part of the career path or pipeline; they really all work together.”
Hoping to drive progress across the career spectrum, five of the country’s top law firms have invested $5 million to fund experimental approaches to D&I over the next five years. MTN’s 28 founding general counsel will also work with these firms, while also piloting these new initiatives within their own legal departments and with external counsel.

“We found five brave, trailblazing firms that were willing to work with us to pull all the levers across different areas, look at their practice groups individually, and see what, from a talent perspective, each group needed to retain and attract diverse lawyers,” explains Hock. “We’re working very closely with them to implement all of our pilots. They’re our ‘lab’ right now to test a lot of our new initiatives, report back and see how they work and make adjustments. Our strong hope is that much of what we implement with them will work and help them achieve their goals, and we’ll then be able to disseminate them more broadly into the legal market.”

Many hands make D&I work

For many of MTN’s founding GCs, the biggest draw is its uniquely experimental nature which fosters innovation in a way that many firms or in-house departments couldn’t – or wouldn’t – do alone, especially when it comes to financing. “One of the things that attracted me to Move The Needle is that it focuses on the relationship between the client – being me, the in-house lawyer – and the law firm. I think that’s a tremendous area of opportunity,” says Laura Quatela, Senior VP and CLO at Lenovo and MTN founding GC. “I’m sure some ideas will work, others will be utter failures, but the law firms, to their everlasting credit, have committed big bucks to fund this experimentation over the next several years. That’s really what was needed, because we have tight budgets, law firms have profitability targets, so I think the funding was necessary and will hopefully help us, in fact, move the needle.”

Hock agrees: “My guess is the talent leads or D&I leads within Move The Needle firms feel like they have a lot more leeway to do their job. Not only do they have the money that they’ve committed, they also have us at Diversity Lab and the entire team helping them achieve their goals, but they also have each other. One of the big pillars of the Move The Needle fund is collaboration in a way that collaboration in the legal industry hasn’t happened before, which is across firms. They’re talking and brainstorming with, technically, their competitors, and I think we’re seeing a lot of growth and learning from that, for sure.”

So, with the knowledgeable support of Diversity Lab, the backing of legal leaders at firms and in-house, and a much-needed cash injection, what has MTN been able to achieve so far? “We’re at the point now where we’re whittling down the ideas to some initiatives that we all want to line up behind,” explains Quatela. “One of the things we’ve talked about doing is a combined law firm/in-house summer programme, where interns or clerks have the opportunity to experience both early in their training. They can start to make the important decisions, like, where do I really want to end up? Which of these backdrops will cater to my own personal objectives?

“Through MTN, I’m personally trying to focus on the ‘off-ramp’. Both law firms and in-house experience this off-ramp of particularly women and underrepresented minorities who, when they get to year five or six, when they could really start to be positioned for leadership, and they leave. Why is that? It happens with such regularity in the legal profession. What are we not doing for these folks? Part of it, I think, is belonging, creating an inclusive culture, but what else is there? How can we incentivise people to stay off the exit ramp? For me, Move The Needle will give us an opportunity to try some things in that regard, that will hopefully make a difference.”

Another way MTN has sought to enhance progression opportunities for diverse attorneys is through piloting a mentoring programme between high-potential associates and GCs. “We’re mentoring them to understand what works well in a pitch, what doesn’t work well, how can we get more engaged on certain matters, inviting them to meet with my direct reports so we can talk about the issues that we face, and whether or not there are opportunities for that person’s firm to get engaged,” explains Rishi Varma, founding GC from HP Enterprise. “It starts creating a connection that results in an engagement, and results in origination credit. That diverse attorney at that law firm is then viewed as somebody who will carry that client forward, and hopefully as they become a partner, a senior partner, a managing partner, they carry that forward. We think about metrics from a diversity perspective, but it’s important to recognise the different obstacles beneath those metrics.”

He who pays the piper calls the tune

As figures from the ACC show that corporate legal departments spent an average of $9.7 million on outside counsel in 2018, the purchasing power that US in-house departments can wield in the name of D&I is significant. Diversity Lab and the Move The Needle GCs have been quick to realise this fact, which is particularly salient when contracting external counsel.

For fellow founding GCs, U.S Bancorp’s Jim Chosy and Hannah Gordon of the San Francisco 49ers, Move The Needle has provided opportunities to open dialogue on D&I with external counsel, ensuring that diversity metrics are front and centre when deciding which firms to contract. “In-house legal departments have big role to play in positively influencing diversity with outside counsel,” says Chosy. “Given our purchasing power, we’re able to drive change and I feel an obligation to do this with our law firms, which we consider an extension of our own in-house function. We do this in several ways, including as I’ve mentioned with the Mansfield Rule, the Move the Needle Fund, and our Spotlight on Talent program. We also request and measure diversity data from our law firms to help drive hiring decisions, and last year presented our first U.S. Bank “Invested in Diversity” award, in recognition of firms’ efforts and success with diversity.”

“Move The Needle is a helpful tool for all of us who would like to ensure that we are acting really responsibly in the way that we seek and select outside counsel,” says Gordon. “We’ve had conversations with existing counsel about the importance of diversity to us, and I think the positive we’re seeing out of that is that outside counsel does listen, and does pay attention to how they staff your cases. I think there’s two things that all of us are looking at when it comes to this issue. One is, what are the overall demographics and statistics of a firm? Then secondly, who is actually the staff on your particular matter? Both of those are important.”

Varma is also acutely aware of GCs’ pivotal role in reading deeper into diversity statistics. “One of the reasons I became a founding member of Move The Needle as a general counsel was, it’s my problem. I’m the one who’s hiring outside counsel, so it’s important to recognise that there are many obstacles to improving that diversity, starting with how people get credit and how people move through the ranks of those law firms. You cannot just look at the numbers at the firm, or the numbers on my matter – you have to look at the quality of the representation you get. If I had a firm working on a matter, and I saw consistently that they had about 10 to 15% of the representation that was diverse, that could be good, or they could have somebody who is diverse at the very top level, but the people doing a significant majority of the work are not as diverse.”

Far from a trite marketing exercise, research from Deloitte confirms that companies who can unlock the collective potential of diverse teams can expect to see innovation increase by around 20%, with risk falling by 30%. Simply hiring a diverse array of people, however, is not enough to achieve these results: while diversity is the bricks that build a team, inclusion is the mortar that bonds teams and ensures members feel a sense of authentic belonging.