ARTICLE
How Social Change Translates into Policy and Operational Change
May 27, 2021
IN THIS ARTICLE
Responding to internal and external pressures on ESG
Ensuring DEI goes beyond ‘checking the box’
DEI Framework
Submit your data and take a step toward being certified as one of the most diverse, equitable, and inclusive law firms in the country.
[Access the full event on-demand and earn CLE credit for watching: Day 1 and Day 2.]
On May 19 & 20, 2021, Bloomberg Law convened legal industry leaders to share insights on how social change translates into policy and operational changes.
Heightened Expectations: The New Era of Corporate & Client Engagement sparked important conversations among leaders across in-house legal teams – and law firms who are setting compliance and legal goals, guiding social responsibility initiatives, and developing new internal policies.
Now in its seventh year, the Bloomberg Law Leadership Forum provides a unique learning and networking opportunity for legal professionals to better understand the changing marketplace and regulatory environment that impacts businesses and law firms.
2021 event overview
The rules for corporate and legal engagement in politics and society have changed dramatically in the past few years. The Covid-19 pandemic and economic crisis, the global outcry over systemic racism, an epidemic of misinformation in a divided country, and widespread effects of climate change have accelerated these changes.
Organizations of all types – especially those that claim to be values-oriented – are expected to acknowledge and act on the issues facing the country. Corporations and law firms are considering how their actions and public statements impact their reputations and brands.
[Bloomberg Law’s ESG resources offer guidance around a number of common risks under five categories – general, financial, compliance, litigation, and transactional. Not a Bloomberg Law subscriber? Request a demo.]
This internal review often involves a nuanced look at contractual relationships with vendors, service providers, clients, and business partners – and they are keeping a close watch on government agency enforcement postures. Beyond operational needs and legal requirements, leadership must now also determine which additional public and stakeholder expectations they will attempt to meet, and how.
Responding to internal and external pressures on ESG
The keynote speakers and panelists discussed the importance of aligning a company’s values with its public statements and actions, not only for the impact it can have on customers and shareholders, but on employees. Likewise, they also emphasized that any statements made on ESG issues must be backed up by tangible actions, otherwise potential legal and public relations troubles could arise.
“I can’t speak for all general counsel, but the mantra that I’ve held to, and that I would suggest others do in their own practice is anchor yourself in the company’s ultimate business goals and principles. What is it that they intend to do? What’s indicative of company culture and then advise within that sort of scope. And so the notion being, if you believe that the company should be creating tools that have great societal impact, then you’re evaluating and giving advice – both in a legal context or any other business context – with that in mind. When you veer away from that, I think you tend to lose your North Star.”
Halimah DeLaine Prado, General Counsel, Google
“It is critical for every company [to ask themselves] where they stand on diversity. Where do you stand on sourcing? Where do you stand on human rights? Then just be consistent. Because if you’re seen as a ping pong ball, then you’re going to be in play. I expect the lawyers to lead here and look at these risks, whether it’s privacy and security of data or sourcing, and push your communications teams to have messaging done already and agree on a plan.”
Richard Edelman, CEO, Edelman
“If there is social pressure and employee pressure and shareholder pressure on trying to look a certain way, then it can be very tempting to … make the statement that ‘we’re not racist,’ or ‘we are carbon neutral,’ or whatever the current buzzword is. But if you aren’t really taking the steps to go through a clear systematic process – if you aren’t engaging the correct shareholders – then that can open you up to all sorts of problems down the line.”
Jillian C. Kirn, Shareholder, Greenberg Traurig LLP
“The value of the hotlines is really twofold. It’s what you learn from the caller, but more importantly, what message you’re conveying to your teams, which is ‘we’re open and we’re willing, and we actually do listen.’”
Peter Anderson, Chief Ethics and Compliance Officer, Carnival
Bloomberg Law 2022 – The Future of the Legal Industry
The legal industry is poised for formidable changes. Download this special report for expert analysis on the hot topics that are shaping the legal industry to help inform your planning and decision-making.
Polling results
With more than 300 event attendees – including law firm partners and general counsel at various sized companies – the Bloomberg Law Leadership Forum provides an opportunity to survey a cross-section of the industry to learn how trends and issues are impacting them. The results are detailed below.
Who in your organization has performance metrics tied to the organization’s ESG mission statement?
Amid the myriad pressures affecting organizations, a new/significantly rewritten policy addressing which of the following issues would your company or a client company be most hesitant to adopt?
How concerned is your company or how concerned are your firm’s clients with backlash and “cancel culture”?
How would you describe your experience with corporate guidelines for the hiring of outside law firms?
The influential Business Roundtable announced its support for four groups of stakeholders (in addition to shareholders) in August 2019. Please mark the stakeholder group your organization has most successfully supported since then, if any.
How often does your organization screen vendor relationships for adherence to one or more ESG standards?
Ensuring DEI goes beyond ‘checking the box’
A main point of discussion throughout the program was the distinction between a company or firm saying they support diversity, and actually making meaningful policy changes to address the inequities in the industry. Some companies, including Intel, have specific rules around the DEI metrics for their business partners, so how do firms and other organizations ensure they are measuring up?
[Keep your legal department informed with access to real-time news, legal and business intelligence, market data, and practice tools all on Bloomberg Law.]
“Despite all of our efforts, still today only 5% of lawyers are black. So, we needed to do something different. We needed to do something outside of the box. So, we implemented a rule saying we will only work with outside councils that have above average diversity and inclusion numbers that share our values and our goals.”
Rhonda Foxx, Social Equity Policies & Engagements, Intel
“Last year, we shifted the program a little bit to enhance our focus on black and Hispanic leadership at our partner firms. … Today about 90% of our first and second chairs in our major litigation matters are diverse.”
Dev Stahlkopf, Corporate Vice President & General Counsel, Microsoft
“Diversity is a competitive advantage at any company. When [it comes to] external vendors, if you are thinking of your strategies as being centric to the white population or to the male population or to any other one segment, then you naturally understand that you are losing out on an incredible amount of opportunity in the segments that you’re not focusing on.”
Tracy O’Flaherty, Deputy General Counsel, Global Litigation, Compliance, Employment & Regulatory, Groupon
“There’s a real concern now with respect to what happened at Coca-Cola. Many people of color feel disenfranchised and feel that that was effectively a beheading. Whether that’s true or not is irrelevant at this point because perception is reality.”
Donald Prophete, Partner, Constangy, Brooks, Smith & Prophete
Save time, grow your business, and deliver world-class counsel. Get the resources you need to succeed – all in one place, and all for one price.
Reference Shelf
- SUBMIT YOUR DATA: The 2021 Bloomberg Law DEI Framework
- ARTICLE: Building a Culture of Diversity and Inclusion in the Legal Industry
- REPORT: ESG Trends in 2021
- ANALYSIS: Companies Urged to Live Up to Racial Justice Pledges
- ANALYSIS: Ten Challenges That Will Keep CLOs Busy in 2021