Diversity, equity and inclusion (DEI) has gradually garnered the attention it deserves as businesses increasingly see the importance of having diverse legal teams, which can lead to more innovative solutions and higher performance.
To dig deeper into this issue, IFLR1000 and its sister brand IP STARS surveyed thousands of corporate counsel on the issue of legal team diversity to gain a holistic understand of what corporates want.
These annual surveys point to the need for law firm advisers to be more diverse, as their clients have indicated that this is a high priority and that they will demand it from their external counsel.
Of the 25,354 corporates that responded to the surveys, 34% indicated that diversity initiatives are important to them, while 25% answered “very important”. For IFLR1000 survey participants specifically, the results are nearly identical, with the scores standing at 34% and 24% respectively.
Corporate counsel IFLR spoke to have also expressed why DEI is important to them and the role law firms have in pushing the DEI agenda forward.
According to one US-based corporate counsel, “it's important to seek the views, opinions, talents and perspectives of people who are not like you, because no matter how smart or prepared you may think you are, you don't know it all”.
For most business problems there is no such thing as one absolute, right answer. “Problems can be tackled from multiple angles or perspectives, and having people who are diverse from you weigh in ensures that your team is looking at issues from more than just your own narrow lens and experience,” the counsel added.
Law firms have a key role to play in amplifying the importance of DEI not only within the legal sector but beyond, as one Asia-based in-house lawyer at an international bank noted. “International law firms have the benefit of leveraging their experiences, programmes, resources and stakeholder engagement in diversity and inclusion from other jurisdictions.”
For a UK-based counsel at a fintech company, the message to law firms is simple: stop talking and start walking. “For firms that have made this kind of public declaration, they are making themselves accountable which is a necessary step for taking action and instigating change,” she said.
Regional breakdown
From a regional perspective, 33% of survey participants from both the Americas and EMEA indicated that diversity initiatives are important to them. The percentage for APAC is slightly higher, at 36%. For those who expressed that diversity initiatives are very important, the APAC region also saw a slightly higher percentage (28%), followed by the Americas (25%) and EMEA (23%).
Overall, APAC saw a high mean score of participants who saw diversity initiatives as important and very important at 70.5%, followed by Americas at 66.8% and EMEA at 65.7%.
In the IFLR1000 survey, the trend is similar, with the APAC region leading with 36% of respondents who said diversity initiatives are important and 27% who suggested they are very important. This was followed by the Americas with 33% of respondents answering important while 26% opted for very important. The EMEA region saw 33% of respondents answering important and 23% answering very important.
Global revenue breakdown
From the perspective of corporates surveyed based on global revenues, diversity initiatives are seen as important by 35% of those with $5 billion or more. Results are similar for corporates with $500 million to $4.99 billion (34%), $50 million to $499.9 million (34%), and less than $50 million (32%). For corporates with $5 billion or more, 26% indicated that diversity initiatives are very important. Corporates with less than $50 million in global revenues also revealed similar preferences at 25%, with 24% the score for those with $50 million to $499.9 million. There was a slight dip at 22% for corporates with $500 million to $4.99 billion in global revenues.
The mean scores saw more interest from survey participants at companies with $5 billion or more in global revenues (68.2%), followed by $50 million to $499.9 million (66.8%), less than $50 million (66.6%) and $500 million to $4.99 billion (65.6%).
For the IFLR1000 survey, results were similar with 35% of those with $5 billion or more in global revenues who indicated diversity initiatives are important. Corporates with $500 million to $4.99 billion in global revenues, less than $50 million, and $50 million to $499.9 million also shared similar results at 35%, 31% and 35% respectively. For corporates with $5 billion or more in global revenues, as well as those with less than $50 million, the score was 25%. Results were slightly lower at 21% for those with $500 million to $4.99 billion in global revenues.
Industry breakdown
Of the sectors that made up the corporates surveyed, 63% of respondents in the advanced manufacturing sector deemed diversity initiatives as important and very important, with a quarter of all advanced manufacturing respondents rating them as very important. This is followed by the real estate and construction sector with 62% of respondents who indicated diversity initiatives as important and very important, of which 29% said such initiatives are very important. For the automotive and transportation, consumer, power and utilities telecoms industries, 61% of respondents indicated diversity initiatives are important and very important.
Overall, the real estate and construction sector saw high interest with a mean score of 69.8%, followed by telecoms (69.2%) and power and utilities (68.7%).
For the IFLR1000 survey, between 21% and 38% of participants said that diversity initiatives are important, reflecting the trend seen across the surveys. The media, entertainment, gambling and sport sector led at 38%, followed by oil and gas at 37%. For those who said diversity initiatives are very important, the range was between 22% and 39%. The membership organisations sector also led in this category, at 39%, followed by government and public services at 36%.
Practice area breakdown
Across the brands surveyed, 36% of IP survey participants said diversity initiatives are important, followed by 34% of financial and corporate law survey participants and 30% of litigation survey participants.
Financial and corporate law survey participants showed high interest with a mean score of 66.8%, followed by IP (66%) and litigation (63.5%).
Methodology
Through our primary research with in-house counsel representatives, we ask them to rate a range of attributes and their importance in decision-making when selecting outside counsel.
We have aggregated the responses from our practice area-specific surveys in 2022 and 2023 and analysed the results in this report series. The data highlights the extent to which in-house counsels’ views on these attributes differ between industries, regions, revenue sizes and practice areas.
In total we have analysed responses from over 25,000 in-house counsel respondents over the two-year period.
