NAMWOLF's CEO Joel Stern on Diversity and Inclusion: Part 1

PERSUIT got together with Joel Stern, the CEO of the National Association of Minority and Women Owned Law Firms, Inc. (NAMWOLF), and as a part of an interview series (see the end of the article for part 2 and 3), we asked him about the future of Diversity and Inclusion in the legal workforce:

Question #1:

In NAMWOLF’s 2014 article, “Uninvited: Counsel Lists and How They Limit Minority and Women Owned Law Firms’ Access to Legal Work,” it is stated that the use of preferred counsel lists has had the unfortunate consequence of perpetuating historic inequality, since those lists are predominantly comprised of majority owned firms, as selection criteria often includes a history of representation, among other reasons. Focused on Diversity and Inclusion, we're asking a three-part question:

  • What are some other common reasons that women and minority owned firms are “rationally” barred from preferred panels?
  • How should corporations rethink their panels and preferred counsel list strategy?
  • And how do these women and minority owned firms best position themselves?

First of all, let me be very clear: I support the notion of consolidating your list of law firms across the globe to take advantage of economies of scale, easier to develop deeper richer relationships and all the other benefits associated with using less firms. However, if you're not cognizant of this next point you're basically going to be recirculating the white male majority owned law firms that you have historically used, when at the same time you're desirous of using more minority and women owned law firms. And the reason for that is simple: When you send out the RFPs to those large firms you're going to be sending them out to the same firms that you've been using historically -- that you play golf and tennis with at the club. And you're going to be ignoring the firms that you're trying to give the ability to come into your corporate world.  That's the, the first thing you need to do is understand there's a risk of adversely impacting a goal that many of your legal groups have, which is to increase the utilization of minority and women owned law firms. Once you have that realization, there's things you can do to minimize the impact including three that i'm aware of:

  • When I was at Accenture, I had the goal of significantly consolidating the list of law firms we were using globally, from 450 to under 200. But at the same time, because we deemed Diversity and Inclusion and the utilization of minority and women owned law firms important, we created a list of minority and women owned law firms that were on a separate panel list; and we grew that from zero to more than ten. This is the two separate list approach.
  • Another approach is to basically say that, ‘if I have a panel list of a hundred firms at all times, a minimum percentage of that list will be minority and women owned law firms.’ So for example, 20  to 25  percent; and I've seen that work in the corporate world.
  • The third approach is what I call ‘the bypass approach:’ if you have your list of panel firms, and the majority of them are majority owned law firms - if at any time the hiring in-house counsel wants to utilize a minority and women owned law firm, they can bypass that rigid panel process and get approval to bring those firms in.

So the key to this is to understand that the issue of consolidation and the issue of utilization of more minority and women owned law firms is not binary -- they're complimentary; but you have to have a focused effort to make sure that you can reconcile both interests.

[Regarding how firms can best position themselves] let's use NAMWOLF as an example. We are a non-profit trade association made up of 195 certified minority, women and LGBTQ+ firms, but we're not first and foremost selling diversity. What we're selling, and what all of our law firms are selling, is the amazing quality and value that they provide that's equal to if not better than what you are used to getting, with diversity & inclusion being the cherry on top of the ice cream. So what our firms need to continue to do - and they do a pretty good job of it - is sell the quality and value that they bring to the table. They may get in the door because they're minority or women owned, but they're only going to get the business if they rank equally if not better than the majority firms they’re competing with.

Expectations for D&I firms:

As a buyer of legal services for most of my career, I am not going to tell you that every single lawyer I used that was with a women and minority owned law firm met or exceeded my expectations;  but I will tell you that the percentage of ‘hitting it out of the park’ with minority and women owned law firms compared to the majority law firms was unequivocally better. And I've heard that from lots of corporations; and the reason for that is obvious, but patently unfair: unlike majority law firms that get three strikes (if you use the baseball metaphor), our law firms not only get only one strike, but they also know if they don't do well, it not only tarnishes their image, but the image of all of our firms in our network. And that's a lot of pressure. They're held to a higher standard than the majority law firms.

Our law firms should be held to the same standard. They should not be held to a higher standard, but they are. Here’s an example: Somebody will say to me, “Hey Joel, I used a Hispanic owned law firm in Los Angeles to do some work and they didn't do a great job.”  I go, “okay have you ever used a white male from a large majority  law firm and have they always exceeded your expectations?” They respond:  “No…..we give them another chance; we write it off, or we ask for another lawyer.”

I say, “that's interesting. Did you ever say, ‘because I had a bad experience with this majority owned law firm I’m not going to use another white male from a majority  law firm or a majority owned law firm across the United States?’”

“No, Joel, that's ridiculous…”

I continue, “Well let's think about what you're telling me: you have one bad experience with the law firm, who knows where the fault lies, and you're suggesting that because of that, you're not going to give minority & women owned law firms across the States the opportunity to compete for - and win - the business. You're holding our firms to a higher standard. That is unfair.”

And then the lights go off. Today - and whether it's conscious or unconscious bias - it's part of what we do for a living. We make it very clear: bring minority and women-owned firms on board because they can do your work and do it well, and hold them to the same standards - not to a higher standard. And if you have a bad experience, you have a bad experience. Treat that experience like you would with a majority firm.

See Part 2 here and Part 3 here.