By Sara Randazzo
Law firms have spent years promising to hire and promote more
Black lawyers. Their corporate clients are now pressuring them to
show results.
Companies including Microsoft Corp., U.S. Bancorp, Uber
Technologies Inc. and Intel Corp. are asking the law firms they
hire to detail how many diverse lawyers they employ and whether
those lawyers are assigned meaningful work. Firms that don't have
good answers might lose out on bonuses or not get hired.
"What gets done is what gets rewarded," said Shannon Klinger,
chief legal officer of pharmaceutical company Novartis AG, which
withholds 15% of legal fees if diversity benchmarks aren't met.
Client demands swelled this year, driven by the national debate
about race and equity. "Lightning struck," said Joel Stern, who
leads an association of minority- and women-owned law firms.
"People are calling up saying, 'Show me the Black lawyers...show me
the Black law firms.' "
At Microsoft, law firms in the company's preferred network can
earn back as much as 3% of their fees as a bonus if they hit
diversity targets. Starting in January, Intel will only hire U.S.
law firms whose U.S. equity partnerships are comprised of at least
21% women and 10% underrepresented minorities. Other companies ask
firms for an accounting of diversity figures without setting
specific targets.
About 2% of partners at U.S. law firms and less than 5% of
attorneys in the lower ranks are Black, figures that have barely
budged for decades, according to the National Association for Law
Placement, or NALP. In law schools, Black students make up less
than 8% of total enrollment, compared with about 13% of the U.S.
population, and are more likely to attend lower-ranked schools
largely ignored by the most prestigious law firms.
While law firms have improved at recruiting minority associates,
Black lawyers say they aren't given enough high-profile work to
ensure a place on the partnership track and aren't handed client
relationships in the same way as white colleagues.
"You'll see the same associate staffed on all the great cases
and think, 'Why am I not getting those same opportunities?' " said
Duvol Thompson, a partner at Holland & Knight LLP. He recently
helped compile a survey of 60 Black male lawyers that concluded:
"The consistent challenge is attempting to rise through the ranks
based on knowledge, experience and ability rather than being
minimized, diminished or judged based on the color of our
skin."
Chaka Patterson, the general counsel of nursing- and
medical-school operator Adtalem Global Education, decided this year
he had heard too many times that big-money deals can only be
trusted to the same cadre of mostly white lawyers who have handled
such assignments in the past. Such thinking "reinforces the status
quo," said Mr. Patterson, who is Black.
When his Chicago-based company set out this spring to buy
for-profit online educator Walden University in a $1.5 billion
acquisition, Mr. Patterson recruited experienced Black law partners
in the three specialty areas he needed: mergers and acquisitions,
finance and regulatory law.
He turned to M&A lawyer Catherine Dargan, a Harvard Law
classmate from the law firm Covington & Burling LLP; Janine
Jjingo, a finance partner at Skadden, Arps, Slate, Meagher &
Flom LLP; and his longtime regulatory lawyer, LaKeisha Marsh at
Akerman LLP.
During the team's first video call, Ms. Dargan sent a note to
her law partner Amy Wollensack: "Ok, so I've never experienced
this. Just pausing on 4 black women partners involved in this
deal."
Ms. Dargan said the makeup of the team was unlike any she had
been on during her 25-year career.
Many companies don't want to take the risk of hiring people they
have never worked with before, Ms. Marsh said, which limits
opportunities for up-and-coming lawyers of color. "You won't know
what you're comfortable with unless you step out and try something
different," she said.
Mr. Patterson said he has been assertive -- and at times
aggressive -- trying to persuade other general counsel to hire
Black lawyers. In late July, after seeing several Black lawyers
post career frustrations on LinkedIn, Mr. Patterson gathered 30
Black general counsel and 30 Black law-firm partners on a two-hour
videoconference call to talk about ways to help.
"There was a lot of momentum for something like this," he
said.
Similar demands have been made to help diversify the
historically white, male advertising industry. This year, a group
of Silicon Valley startups led by SurveyMonkey pledged to track
diversity in the ranks of law firms, investment banks and other
companies they hire.
In any given year, a handful of the nation's largest law firms
have no Black partners. Elite law firm Cravath, Swaine & Moore
LLP, which has 500 lawyers, has had one Black partner in its
centurylong history. On Thursday, it named two more. A spokeswoman
for the firm said diversity and inclusion is "a priority and work
in progress."
April Miller Boise, the general counsel at power-management
company Eaton Corp., said many law-firm leaders have historically
attributed the departure of Black and other minority lawyers to
recruitment and better jobs. She said fewer lawyers would leave if
they were offered attractive opportunities.
Attrition rates for minority associates were 22%, compared with
17% for white associates, according to a study this year by the
NALP Foundation, an industry research group, and legal recruiting
firm Major, Lindsey & Africa. Law firms were more likely to
attribute the exit of Black lawyers to problems with their work
compared with white, Asian or Latino lawyers who leave, the study
found.
More than 150 law firms and corporate legal departments have
pledged to increase diversity by joining an initiative that
requires employers to field a minimum proportion of diverse
candidates for every hire and promotion. It is known as the
Mansfield Rule, named for Arabella Mansfield, the first woman
admitted to practice law in the U.S.
James Chosy, the general counsel of Minneapolis-based U.S. Bank,
said he signed up his department for the Mansfield Rule, run by a
San Francisco-based group called Diversity Lab, and urged all the
law firms he hires to do the same. "For a profession that's
supposed to be all about equality, opportunity and justice," he
said, "we should be first, not last."
Write to Sara Randazzo at sara.randazzo@wsj.com
(END) Dow Jones Newswires
November 02, 2020 05:44 ET (10:44 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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