Acritas is the world’s leading source of client and market research to law firms around the world.
A new global legal market survey by consulting firm Acritas examining the impact of diversity has found major differences in legal buying behavior between men and women. The survey of 1,771 senior in-house counsel found that overall, male general counsel get paid more than female general counsel. It also found that male GCs spend more on legal services than female GCs. Over the past decade, Acritas has surveyed 20,000 law firm clients.
Using its Sharplegal data, Acritas found only 25% of legal teams are very diverse and yet the benefits of diverse teams are clear as more diverse teams generate higher performance levels, an increased share of spending and are more likely to be recommended to clients’ peers.”To enable diversity to thrive, firms will need to adapt their business models and change their internal cultures,” said Acritas CEO Lisa Hart Shepherd. “The firms who take this seriously and make radical changes will move ahead in their chosen markets.”
Men Earn More and Plan to Spend More
According to Acritas, women working in senior in-house legal positions are paid less than their male counterparts. The same research results reveal male GCs as more likely to be growing legal spend (+12% anticipated increases in overall legal spend), whereas women are planning to keep their legal budgets the same as their current total (+0%).When analyzed worldwide, the trend is consistent in key geographic markets except in the Asia Pacific region where female GCs earn 26% more than male peers. In the U.S., the gap is 18% less when comparing females to males in chief legal roles. Even when Acritas analyzed the breakdown of across company size, age and whether the GC in question previously was at a law firm, women consistently earn less.
“The difference in salary levels is perhaps not surprising, given the same issue exists in most other industries,” added Ms. Hart Shepherd, “but for a profession which is based on ensuring fairness and equal treatment, this gulf in reward levels should be addressed.”
Diverse teams perform better
Additionally, the survey says that compared to ‘not at all diverse’ external legal support teams, ‘very diverse’ teams provide a superior performance to their clients across all key performance areas. Significant differences are reported most notably in relation to the value delivered. Overall satisfaction scores are also significantly improved when clients are working with very diverse teams. “When clients feel they are working with very diverse teams, they are significantly more likely to promote the law firm they are working with to others – which all firms are working towards as it is the ultimate signal of a strong client relationship,” Ms. Hart Shepherd says. “And the proof of the pudding is in share of wallet, with very diverse teams getting a 25% higher share of wallet than not at all diverse teams.”
Men and women buy differently
While quality and specialized knowledge tops the list for both genders, senior male in-house counsel base their preferences for legal support more on results, reputation and relationships. Senior female in-house counsel are more attracted to firms who display responsiveness, business understanding, client focus, commerciality and efficiency.
“Only 14% of lead partners clients work with at their main firm were female. Given that in most countries women take over 50% of junior lawyer roles when starting their careers this loss to the profession is unforgiveable,” notes Ms. Hart Shepherd.” Having proven that a lack of diversity is also hugely detrimental to long-term financial success, firms need to drastically overhaul their expectations of working time to retain more women in the profession.”
