From the delivery of its core service to clients, to strategy and market positioning, the global legal market is evolving at a rapid pace.

To support this, law firms require strong functional leadership to help firms evolve and drive necessary change.

Leathwaite analysed the top 50 Law Firms globally and assessed the backgrounds, location, tenure and gender of the C-Suite business function practice leaders. The purpose of this whitepaper is to show a snap-shot analysis of the market, and open a discussion amongst law firm leaders on the topic of functional management within the sector.

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Online Paper extract:

Executive Summary – 

From the delivery of its core service to clients, to strategy and market positioning, the global legal market is evolving at a rapid pace.  To support this, law firms require strong functional leadership to help firms evolve and drive necessary change.  There appears to be real appetite to diversify the C-suite of business functional leaders in the legal sector but in reality, law firms still struggle with how to embrace this successfully.

We believe this trend is changing, and the legal market has made an effort to evolve their C-suite, demonstrating that they are open to fresh thinking from the wider professional services sector and beyond.

However, law firms are still regarded as behind the curve against other sectors and, at a macro-level, this change has proved slow. While the tide is turning, law firms still struggle to initiate and drive cultural and functional change.

This is largely attributed to the fact that law firms are politically complex organisations and business functional heads do not typically have the same level of authority as they would enjoy in a corporate or financial services organisation.

The partnership structure of a law firm still represents the driving force behind decision making and, too often, senior functional leaders are not part of this decision-making group.
In our searches, clients increasingly look to import talent from other sectors, something that Leathwaite work hard to facilitate and strive to challenge our client’s thinking around.

However, there remains a comfort in hiring individuals who understand the eccentricities of law firms and once hired, the bounce rate of non-law firm candidates is still too high.

We believe that law firms could do more to embrace diverse hiring but critically, that firm’s must focus more on how they support with the integration of these individuals. We also believe that there are unique nuances to law firm structures that mean that, in some instances, the best hire for a firm to make is to hire someone who understands them.

This paper aims to share our analysis of the C-suite business functions in the Top 50 Global Law firms and to invite discussion around these findings.

What we have done?

Leathwaite have analysed the Top 50 Law Firms globally (by lawyer headcount) and assessed the backgrounds, location, tenure and gender of five business function practice leaders:

  • Chief Human Resources Director (CHRD)
  • Chief Operating Officer (COO)
  • Chief Financial Officer (CFO)
  • Chief Information Officer (CIO) / Chief Technology Officer (CTO)
  • Chief Marketing Officer (CMO) / Head of Business Development

Across the Top 50 Law Firms, Leathwaite have mapped the backgrounds of 258 individuals to include in this report.

There is a clearly identifiable “Head of’ within Human Resources, Operations and Finance. Unsurprisingly, there was more variance around the positioning of the CIO and CTO as well as around the CMO and Head of Business Development. For the purposes of this analysis we have combined the data for these functions to show a wider and more accurate data set.

We have not included data on the role of Chief Innovation Officer or the Head of Strategy in this paper. Currently these positions appear to be filled on a more ad-hoc basis as the roles are still, at some firms, in their infancy.
The aim of this exercise is to draw out the key data surrounding each role and review which law firms – and within this, which specific business functions – are making more progress in successfully adopting out-of-sector talent versus arguably ‘playing it safe’ with talent already within the sector.

This research does not address the breadth of background of talent coming into these functions at a more junior level, which we would anticipate would show a more progressive story.

Conclusion – 

The legal market is changing, and there is increasing demand for high quality functional leaders who can deliver change and innovation, particularly around the evolution of technology and AI.

Given the complexity and scale of global law firms, high quality functional leadership is essential to delivering success. In order to survive in an increasingly competitive (and disrupting) market, law firms need well-led functions to guide them through this period of evolution.

That said, there are clear idiosyncrasies associated with the legal market which makes it harder for firms to attract and integrate professionals from outside of the sector.

While we believe the changing legal market demands that law firms require aspirational functional hires to drive complex change, the data paints a picture of law firms, more often than not, favouring senior hires with a legal sector background.

Leadership teams often commence a functional search looking for a diverse mix of out-of-sector talent, and all too often, decide upon a professional who provides the comfort factor of knowing the dynamics of the law firm environment.

This comes as no surprise given the skill-set candidates required to be successful with a law firm. Often individuals sitting within other sectors can present as too ‘command and control’ and ‘change-driven’ for a partnership model, which is used to a consensus-driven approach. Culturally, this can feel like a risky hire for a law firm to make.

The legal sector is unique in the fact that functional heads are often placed in positions of responsibility without genuine authority. Individuals must have the ability to drive through change, but equally ensure that they do so very carefully and through building relationships and influencing the partnership.

Successful functional heads are highly politically adept but without being political themselves. Law firms, as a general rule, do not embrace change quickly and therefore individuals must bring patience but also the resilience to revisit conversations until the wider partnership are comfortable with a decision.

While law firms may need to do more to attract diverse professionals into the sector, there is an argument that every law firm is different and firms need to assess their personal appetite for functional change and evolution. The unique characteristics of law firms means that, in some cases, the best hire for the role is someone who already understands the legal sector.

This data does not identify the out-of-sector hiring being achieved at the junior and mid-level nor the success level of that talent integrating into a firm. If this is being done effectively, we would anticipate there is a more diverse slate of candidates coming through as next generation functional leaders.

We are, however, sceptical that this change is effectively happening and believe that there is still a significant bounce rate of hires leaving the legal sector, never to return. If law firms cannot curb this and better integrate these individuals, they will find it harder to elicit change.

The purpose of this white paper is not to offer a concrete direction of thought, but rather show a snap-shot analysis of the market, and open a discussion amongst law firm leaders on the topic of functional management within the sector. Leathwaite are keen to explore how the industry can better challenge the decision-making process around functional appointments and ensure that law firms’ hire the best candidate for the role.

Author information:

The paper was researched and authored by Kate Huggins and Kirk Williamson, both of whom are based in Leathwaite’s London office.

Leathwaite is an Executive Search and Human Capital Specialist Firm, offering a range of C-Suite retained search, talent and leadership services with offices in London, New York, Hong Kong and Zurich.