The Importance of Evaluating Law Firm DEI & Where to Begin

by | Jan 18, 2022

As more and more companies invest in diversity, equity, and inclusion (DEI) efforts, it’s important for legal departments to carefully manage their initiatives that support DEI, and to monitor the DEI initiatives of the vendors they work with. This includes outside counsel, which can be challenging because the legal industry is improving diversity much more slowly than other industries. According to the American Bar Association (ABA), there have only been small incremental improvements for both women and minorities over the past decade.


Building DEI into the Culture Leads to Better Financial Results

Incorporating DEI into organizational culture leads to several business benefits. These include, but are not limited to higher revenue and better financial results. From the ABA website:

“In its 2015 report Diversity Matters, McKinsey reported that in its study of 366 public companies, it found that gender, racial, and ethnic diversity correlated to positive financial performance. Vivian Hunt, Dennis Layton & Sara Prince, McKinsey & Co., Diversity Matters (Feb. 2, 2015). The performance differential was significant: Companies ranking in the top quartile on these aspects of diversity were 15 to 35 percent more likely to have financial returns above national industry medians.”1

From a corporate/firm culture point of view, when employees feel represented and respected, they’re able to bring their best efforts to work. This leads to better performance and better productivity.

So, choosing outside counsel that incorporates DEI efforts helps meet company requirements and helps get better results and service from your outside law firms and vendors. But how do you choose or know if your preferred firms or prospective firms meet DEI requirements or make efforts towards improving DEI?

Evaluating Outside Counsel and Encouraging DEI

There are ways to measure efforts to demonstrate whether law firms meet corporate DEI requirements. Read our article, Improving Law Firm DEI: How General Counsel Should Evaluate and Coach Their Vendors. We go more in-depth about the importance of and considerations for:

Assessing the Talent Pool
Discover examples of assessing DEI data in a broader, more accurate context. While hiring a more diverse client-facing team looks good, to truly understand and measure DEI effort, there are other variables that should be considered.

Establishing DEI Metrics
Firms that focus only on metrics such as percentage of diverse lawyers may not be meeting client-driven expectations.

Building Successful Vendor Management Programs
Learn how benchmarks play an important role for setting DEI goals and requirements based on industry and region.

Rewarding Vendors for DEI Progress
See how client organizations can benefit from encouraging and rewarding outside counsel and vendors. In the end, DEI is a win-win for everyone.

Measuring the “E” in DE&I

The lack of diversity improvement in the legal industry is rooted in failure to create environments that foster equity and inclusion. This is supported by our recent LexisNexis® CounselLink® study that used hourly rates as one measurable assessment of equity, comparing hourly rates for white male lawyers to those of women and minority lawyers.

CounselLink DEI Campaign -
For the full Measuring the “E” in DE&I infographic, click here.

CounselLink is committed to helping improve the diversity of the legal industry. Would you like more information about how to build a diversity program and have a meaningful discussion about diversity with your law firms? Contact us for more information.

Additional Resources:


1 Why Diversity Matters in the Selection and Engagement of Outside Counsel: An In-House Counsel’s Perspective

Kris Satkunas

Kris Satkunas

As Director of Strategic Consulting at LexisNexis, Kris leads the team’s efforts to advise corporate legal department managers on improving operations with data driven decisions. Kris has over 15 years of consulting experience in the legal industry. Areas of expertise include benchmarking, practice area metrics and scorecards, dashboard design, matter pricing and staffing, and cost management.

Prior to joining the CounselLink team, Kris honed her legal industry knowledge by advising and consulting with leaders in large law firms. As Director of the Redwood Analytics Think Tank, she partnered with a group of industry thought leaders to develop advances in analytics and best practices that improve law firm performance. She has authored numerous articles and speaks regularly at legal industry conferences and events.

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