Top law firms look outside law for finance, inside for IT, and to women only for HR

Top law firms' gender mix for senior support roles in two out of the three titles surveyed performs poorly against other sectors.

Three major factors will drive change in the world of legal in the next 18 months - the completion of the jigsaw of legal services reforms that is the Legal Services Act, the still uncertain rise out of recession that the UK will make, and a general election.

One of these things can be talked about with some certainty, and that's the LSA - but how it will impact law firms is as unknown almost as whether house prices will float back to previous highs or who will be using the front door to No 10 Downing Street by the end of 2010.

But to look forward, we should first look back. Examining the roles of IT, HR and finance in the top 100 law firms from LSN's research it would appear that BigLaw has taken lessons in recent years from its experiences since the beginning of the 1990s. If you were a follower of the pronouncements of law firm management consultants, you'd think firms were listening hard too when it came to seeing the need for taking talent from other business sectors and taking lessons from those sectors about binding support roles into the leadership tier of the firm.

But the research shows that top law firms are behind the business curve when it comes to the percentage of women in senior non-legal/support positions - significantly so in the case of finance directors. Law is also behind in terms of entitling heads of IT equivalently to their other 'C-level' counterparts in finance and HR.

The research also shows that since 2000 there has been a marked increase in job mobility (number of 'moves' in the top 100) in all three support positions in the top 100 compared to the previous decade, and one could say an 'appropriate' amount of drawing in of 'outside talent' in the world of IT management and HR.

Finally, for two out of the three positions surveyed, legal appears to give them the status they deserve - both HRD and FD positions are mainly titled 'director' and for finance chiefs, the 'new' 'C-level' titles of CFO are quickly gaining ground. IT directors, however, in the top 100 are only half the time given the title of 'director'.

Chris Bull, chief operating officer of outsourcing company Integreon, agrees that this difference means there is "less acceptance of IT as a 'director level 'or 'board level role" and, he says, the recent increase in drawing in of 'outside' talent to the finance role is a good thing. "I do think the legal FD world, especially in London, had got too cosy over the last 10-15 years."

Law firm advisors know these firms' support functions well - they have to work intimately with them. So Chris Ryan, senior director in the global Infrastructure and business process practice at management consultancy Hildebrandt, also agrees that law firms are waking up to the CFO role. Although the jury is still out on whether non-law firm directors are working out, he says. "I believe UK law firms highly value directors, whether in Finance, IT or HR, and in many of my client environments these directors sit on the management/executive committees. Thus, from my experience directors seem to have progressed and are key decision makers in the business."

Lisa Smith, vice-president and head of Hildebrandt's law firm strategy and structure practice group, says that once the Legal Services Act is fully in place, the role of C-level people in law firms could become very different: "A factor here is that C-levels do not share in the profits of the firms. This could change with the LSA as that provides for non lawyer ownership. But today this is a subtle difference where C-levels do not have the same economic interest in the performance of the firm as the partners do."

Compared to IT and HR, though, finance is a more 'old fashioned' role - the research shows top law firms are only just 'getting it' as to the need for more outside talent in the world of law firm finance management. This doesn't mean that the outside world is taking over law firm FDs, but it does mean that it looks the FD world might be on track to benefit from a growth period of pulling in outside talent. IT, on the other hand, after spending a great deal of time pulling outside talent into law firms, has now matured to the point where inter-law firm moves are in the ascendant.

The view of Gary Jones, an ex-law firm HR professional who is now a consultant at First Counsel recruitment consultants, on HR's draw from 'outside' is representative of the issues at hand: "Other sectors are regarded as more progressive and innovative - because they are - but the legal sector is trying to catch up, and is in many cases. How they catch up is by capturing those people who have seen it and done it in, for example, the big accountancy practices, or the consultancy world. There are a lot of ex-Ernst & Young HR people at the top of law firm HR trees right now. We would see this trend continuing, and think it's a good thing."

"According to the Equality and Human Rights Council's last annual Sex and Power report (September 2008), if you compare law firm finance and IT directors with senior police officers, MPs, FTSE 100 directors, headteachers, chairs of national arts companies and health service chief execs, only senior police officers (11.9% women) and FTSE 100 directors (11% women) are less likely to be women. If FTSE 100 companies have made any improvement since they were last surveyed, law firm FDs will be an even more isolated male enclave - the number of women in power in FTSE 100 firms has only to rise by two people to be higher than law firm FDs."

So all the titles are becoming more mobile - in HR, much more mobile - and those that need it are still pulling in outside talent. But this hasn't helped the gender split in two of the three titles. Reasons put forward as to why this is the case range from a much larger female pool of applicants for positions through to HR being just naturally more a female-oriented - but if you look at the reason why, in other business sectors, women number few entrants in senior management, it's down to lack of opportunity, lack of time, and an inability to get back into the senior level after having children. Is law so very different?

If it were really true that the basic components of reaching the upper echelons of the workplace - long hours, sacrifice, total commitment - kept women, LSN's research would surely show a similarly small number of women running HR. It's hard not to come to the difficult conclusion that law firms still think that it's acceptable for a woman to be head of people management - but running the IT or, heaven forfend, running the money, is a man's job.

In summary, almost everyone questioned for the role-specific reports, which have been released on www.legalsupportnetwork.co.uk, thought the way senior support roles are titled and respected, and what power and respect they'll have, will change radically as legal services reforms write their own changes on the legal landscape. Whether these will change the gender mix in senior roles, however, is much less clear.

To view the results of the Top 100 law firm directors research please go to www.legalsupportnetwork.co.uk/top100.