Kate Karas, Senior Associate General Counsel, Lending Club

Karas shares the methods she has discovered to boost female and diverse legal leadership within fintech.

The Rooney Rule is used in the football arena to make sure that when NFL teams are hiring professional staff supporting sports teams, they have some diversity options. An organization called Diversity Lab has developed something called the Mansfield Rule – a spin-off from the Rooney Rule – which is a framework to make sure that as you’re considering new talent to promote or to attract laterally, you ensure the people being considered represent the population as a whole, or represent a significant level of diversity. The format that takes is to make sure that 30% of the candidates you are screening, and 30% of the candidates that you’re bringing in to interview are diverse. We use the Mansfield Rule very heavily for recruiting, retention and promotion, including recruitment of outside counsel.

We participate in local initiatives – we’re part of the Law in Technology Diversity Collaborative, which is a collaborative of seven companies in the Bay Area that recruit diverse summer interns. These are people who law firms, for whatever reason, have not recruited from law schools but who are incredible superstars. Each company partners with a law firm. We host the intern for five weeks each, with the idea that they then have both technology company and big-name law firm experience. The hope is that they can get an offer from the law firm at the end of the summer, which is a real jump-start to their career, particularly for diverse and exceptional students who have been left on the outside by law firms in the campus recruitment process.

In the legal team, we are very focused on our own initiatives. The Law in Technology Diversity Collaborative is a legal-only collaborative, and so is the Mansfield Rule. Where we lean on the company-wide initiatives are in elimination of bias training, mentorship opportunities, affinity group memberships and meetings – we have a women’s internal network that meets fairly often and finds initiatives, so it’s a nice pairing. We hold hands with the company-wide initiatives, but we are very focused in our own group on making things happen just for the lawyers and legal staff.

As a general matter, we rely very heavily on internal elimination of bias training, to make sure that people are aware of their own biases. Unfortunately, people tend to interview for people who look like them or remind them of themselves, so we try to raise awareness of that fact in a way where people don’t feel defensive, but have some awareness of their own contours.

Honestly, it’s a really fine balance between token diversity and looking around and understanding if we’ve been successful, because we all have a unique upbringing and story, and we don’t want to discount people’s humanity. But we also want to advance and promote traditional diversity here; finding, promoting and retaining women leaders is one of our top corporate goals and so we have company-wide and group-based metrics where we look at the percentage of women in each position, the percentage of fallout year over year from each level, and people in the pipeline. We have internal development programs that we send high-performing women and other diverse talent to, and we have an equal pay study going on. We look at the numbers, we understand who is at what level by ethnicity and gender and where we have gaps, and then we try and fill those gaps based on precise outreach.

D&I efforts are such important, complex initiatives. Of course, ‘diversity and inclusion’ is easy to say out loud, but each person is a complex set of circumstances. I have two young kids, and I’m very aware that when you have a young kid, it’s a tough thing to figure out how you do your work and pick them up from school. Figuring out how to accommodate different life stages and demands in order to make the workplace welcoming and accommodating to all forms of talent is critical. The learning curve is steep, and that’s one of the reasons I’m very appreciative of the support of Diversity Lab and others to help us climb that curve. Diversity Lab certifies outside counsel as Mansfield-compliant – which means that the outside law firms are considering 30% diverse candidates for partners, track and for lateral hires, etc. If you get the certification, then you get to come to a conference with in-house counsel. And it means that we can rely on that certification to know that, in hiring, we’re promoting and living our own corporate and personal values.

Diversity Lab creates many forums for senior lawyers to get together and share tips and tricks. For example, if you have pumping rooms at work with hospital-grade pumps, that is something that tends to promote women returning to work – and staying once they have returned. Having some flexibility in job scheduling, job sharing, extended maternity leave, Milk Stork – these are things that support moms.

You can promote diversity in outside counsel through either financial incentives or financial penalties, or through simply asking a lot of questions to determine how credit is allocated at the firm and who is financially rewarded for bringing in and/or doing your work. Promoting diversity and inclusion outside our organization is as much of a concern for us, so we ask a lot of questions when trying to hire for our matters; asking about matter credits is a sign that you care about where your money goes and that its path reflects your values.

If you have the right culture in legal, then it tends to be a group of people that are listened to within a company. Legal teams are in a position of strength to lead by example, because people do listen and I think it can have significant weight – so using that for good, and to express strong corporate values is really worthwhile. So, talking about it, but also leading by example, is important, and also offering easy ways to do it. The Mansfield Rule makes it really easy: you just don’t bring candidates onsite for interviews until 30% of the pool (or more) is diverse. The hiring manager has to be disciplined enough to say, ‘We’re not ready to bring people onsite; these are the metrics that we are trying to meet in diversity, we are not yet ready to take action in hiring because we haven’t been able to consider the things we are committed to considering.’ Essentially, you have to commit to not letting the urgent overwhelm the important. Hiring is always urgent but doing it to reflect your values is critical.

Fintech tends to be very dominated by men at the executive leadership level. In my case, I didn’t think about it; I followed my nose to what was interesting. When I left my law firm, I joined a fintech start-up that was run by two women, and then my next general counsel was a woman, so I think I’ve had a little bit of an anomaly of an experience where I’ve had women around me in an otherwise male-dominated industry.

I think that there are a lot of people that are incredibly focused on this and think it is a really urgent issue. I also look around and notice, particularly in fintech, that there are very few senior female lawyers by percentage, so something is being lost between A and B. But,in my experience, people think this is an urgent issue.

I think you see a desire to have more women in senior roles in legal and also across the board in fintech, and what I’ve come to realize is that in legal – like finance, like marketing, like engineering – the need is to prepare and promote women to leadership. And because legal is a service function, there has to be a business need for a leader, so the business has to recognize women as those leaders. And you can generate a bit of inertia: because women may show the same biases that we’ve been talking about, in that they tend to recognize talent that reminds them of themselves, one of the good things is that if you have more women senior leaders, you get more women senior leaders. If you have more diverse senior leaders, you get more diverse senior leaders – because they can and do recognize talent that might otherwise go unnoticed.

My goal has been to lift while we climb: essentially, to help other women who are really successful, smart, leaders and make sure that they, in their groups, are having opportunities. To advocate for them and point out – in meetings, at events, in emails, everywhere – how great their work is and what an impact they are having on a project or a team or the company or culture – to make sure that people are seeing them as senior leaders.

I often try to go to women-owned staffing businesses when we’re sourcing contractors. Any time you’re spending money, you can spend it in accordance with your values, and I keep that in mind with individual people and with service providers. There’s plenty out there that can satisfy what you’re looking for, and I think a rising tide floats all boats.