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Episode 74: Becoming More Competitive in the Diversity & Inclusion Arena with Valerie Fontaine, Partner & Legal Search Consultant at SeltzerFontaine

Guest: Valerie Fontaine, Partner at SeltzerFontaine

Episode 74: Becoming More Competitive in the Diversity & Inclusion Arena

Sharon:   Welcome to the Law Firm Marketing Catalyst podcast. Today, my guest is Valerie Fontaine, partner in the legal consulting firm SeltzerFontaine, which specializes in the placement of lawyers with leading law firms, corporations, nonprofits and governmental entities in California and nationally. Today, we’ll be talking about diversity and inclusion in law firms, and how smaller and regional firms can compete in this arena. Valerie, welcome to the podcast.

Valerie:   I am thrilled to be here, Sharon.

Sharon:   So glad to have you. Tell us about your career path. Did you always want to be a lawyer? How did you segue from the practice of law to becoming a legal recruiter?

Valerie:   I had no idea what I wanted to do when I grew up. I had all kinds of ideas. When I was in high school, I was competing in a debate tournament and one judge said to me, “Gee, you’d be a great lawyer,” and in that moment, a light bulb went off in my head. It combined all the things that interested me, so from that moment I was on a path. I finished high school, went to college, went to law school, got a job at a big law firm and then woke up one day and realized I wasn’t really happy. I was in the wrong environment, but I didn’t know quite what the right environment was for me. Legal recruiters started to call me. I didn’t even know they existed until they started to call me, and one asked me one day if I would be interested in being a recruiter. I thought, “Well, that might be a good idea. I’ll be a recruiter. I’ll see what positions are out there. I’ll find the right one and place myself in that job.” That was a little over 30 years ago.

Sharon:   You found the right job, right?

Valerie:   I guess I found the right job.

Sharon:   Tell us about your business today. We’ve known each other a long time and I know it’s changed as the market changes.

Valerie:   Yes, we have to change along with the market, and we’ve seen a lot of changes over the 30-plus years I’ve been doing this. Because there’s been so much more mobility, there are all different levels. There used to be just associates and partners; now, there are all different levels of partners. It’s become much more of a business, so we are always looking for partners with business knowledge. There’s a lot more business thought that goes into it; a lot more strategy that goes into it. Also, the areas of practice that are hot and cold change, depending upon the economy, technology, politics, what’s going to be enforced not enforced. There are a lot of changes.  We have to stay on top of things all the time, and it certainly is not boring.

Sharon:   I would presume that, seeing what happens with executive recruiters, you have a lot more respect today than you might have in the past because you have to look at what you’re doing from a human capital angle as opposed to, “Oh, they want to sell me a lawyer,” let’s say.

Valerie:   That’s true because we’re becoming a business partner with our clients. They look to us for advice on what is marketable, what they can do in any given market, what sorts of lawyers are out there, what kinds of billing rates they should be asking for, what’s doable and what’s not doable. We really are partnering with our clients in helping them achieve their business goals on the one hand, and our candidates, who are the lawyers we replace for them, we’re also partnering with them in their career development over time. We’ve been doing this long enough. We’ve worked with lawyers from the time they were associates all the way through—some of them have even retired from places where we placed them over the years.

Sharon:   Wow! Has diversity and inclusion always been a subject that’s come up when you’ve talked with law firms, or is this something newer? Has the meaning of diversity changed?

Valerie:   Those are two different questions.

Sharon:   O.K., go ahead.

Valerie:   Yes, I would say in the beginning, way back when—I started doing this in the 80s—diversity was something we brought up. Here at SeltzerFontaine, most of us are former practicing lawyers and at the moment, all of our recruiters are female. Diversity was something that was of great interest to us, so that was something we would introduce to our clients. I remember walking into a boardroom or conference room of a law firm once and looking around at pictures of all their managing partners going back through time, and of course, they’re old white men. I looked around and said, “Hmm, I think we need to change this.” Over time, the clients came to us asking for diversity, and the reason they’re coming to us asking for diversity is because their clients are pressuring them for diversity. I could talk more about that in a minute, but I’ll talk about the definition of diversity, how that’s changed over time.

Now, it’s not just diversity but inclusion. Diversity is hiring the numbers, what the stats and metrics are, how many women, how many people of color, how many LGBT, how many veterans, how many people with disabilities, that sort of thing. That’s asking these people to become members of the team hiring them. Inclusion is actually making them feel welcome, giving them a real role to play, making them an integral part of the organization and helping them succeed and advance through that organization, as opposed to just asking them to join your team. It’s keeping them on the team and letting them play important roles, and maybe even making them captain of the team. Those are two different things, and inclusion is becoming more and more prevalent in the conversation these days.

What I was going to say is that the definition has changed, in that my first thought when I was talking about diversity way back when was women and people of color. Over time, that’s also grown to include LGBT and people with various levels of disabilities or needing various levels of accommodation, and veterans and mental health is becoming more and more part of the conversation. A diversity of viewpoints is becoming important as well, and the reason we’re hearing more from our clients about diversity is because their clients, in-house counsel, are making it a point to say, “You have to have diverse teams, not only in your numbers but actually participating on your matters.” I would say that started back in 2004. There was a call to action where a number of corporations got together asking law firms to sign on saying they would increase their diversity. That introduced the idea, but it didn’t go very far. Then in 2017, which is only a couple of years ago, the ABA passed Resolution 113, where they actually have forms and metrics that corporations are sending out to law firms to fill out, so they can compare apples and apples and oranges and oranges and see which law firms not only have the numbers, but are going to put diverse people on their teams. That was a start to really put some teeth into it.

Lately we’re hearing more about the Mansfield Rule, which is a take-off of the Riley Rule from sports, where there has to be a person of color or an underrepresented person included on every panel of candidates being considered for a major role. What the Mansfield Rule is, they’re looking for not just one but 30 percent of candidates for significant leadership roles. That means compensation committee, partners, equity partners, lateral partners and practice group heads and management committee, for example, being from a diverse group. A number of law firms are signing on to that. At first, I think it was female and people color. Now, they’re including LGBTQ, so it’s Mansfield 2.0. Mansfield 3.0, which is coming up, is going to include lawyers with disabilities.

Intel has taken it even further. They’re saying as of January 2021, Intel will not retain or use any outside law firms in the United States that are average or below average in their diversity. What that means is they want at least 21 percent of their firms’ U.S. equity partners to be women and at least 10 percent to be members of a non-Caucasian race or self-identified LGBTQ or disabled or veterans. When the law firm’s clients are saying, “We won’t hire you unless you have this kind of diversity,” that means law firms have to hire and include lawyers of all different kinds of backgrounds. That’s why they come to us and say, “Help us hire at all different levels.” That’s a long answer to your question.

Sharon:   You mentioned mental health as a disability. What do you mean by that?

Valerie:   Mental health is becoming more and more in the conversation. That’s a new thing that happened last year. Mental health can also be considered a disability, so lawyers can self-identify as being disabled if they have a diagnosed mental condition as well.

Sharon:   Such as? I’m trying to think—

Valerie:   Schizophrenia, ADHD. I don’t have the specifics. This is something that’s sort of new. There are no bright lines on this yet, but that’s becoming part of the conversation in the legal community, where they’re talking about mental illness and mental wellness.  It used to be that a lot of state Bar Associations would ask, “Do you have a mental illness?” on the fitness part of their entrance requirements. There’s a movement to take that question off of that, so rather than using it as a way to exclude lawyers, using it to make—there are more and more very successful lawyers who have come to the forefront admitting they have a diagnosis of depression or various types of disorders.

Sharon:   Has it become harder to find this kind of candidate?

Valerie:   Well, setting aside the mental disability part, because that’s not something we ask about or have gotten involved in, but in terms of finding candidates who fall into various diverse or non-majority classes, they’re out there. Of course, there are more and more women who are more visible, but there have not been enough advances in the other areas in terms of their being hired by the majority law firms, Big Law. I don’t know if you want to talk about what smaller firms can do—

Sharon:   Yes, absolutely. They seem to be at such a disadvantage.

Valerie:   Well, yes and no. The competition is really fierce to recruit minority talent, so what’s happening is that general counsels are making these pronouncements about what they want to hire and not hire in terms of outside counsel with diverse numbers and inclusion. They’re actually increasingly looking at smaller and regional firms. Specifically, they’re looking at ones that are certified women-owned business, minority-owned businesses, etc., because they are already identified and have that seal of approval. For example, women-owned businesses have been certified as such for 20 years or so. There are also firms that are spinoffs of large firms, and I’m seeing that more. Today there was an announcement that in Miami, a group of lawyers is spinning off from Boies Schiller to form their minority and women-owned firm. There are more and more spinoffs that are actually leaving Big Law just so they can attain that certification and then go after work from the outside counsel and big corporations to help them meet their diversity numbers. But other firms that are not necessarily spinoffs, there are ways they can compete for minority and other candidates, and the way they can compete is not necessarily on numbers. There are firms like Susman Godfrey that beat the Big Law numbers, but most smaller firms really don’t in terms of compensation numbers.

Compensation aside, there are other things that lawyers are looking for. What minority talent is looking for, just like any other lawyer, is they want opportunity. This is where smaller and more regional firms can compete because they’re looking for opportunities to learn and diversify their skills for the long term of their careers. For example, I’ve made a number of placements out of Big Law into smaller, local/regional firms because those attorneys were looking for hands-on experience. In litigation, a fifth-year associate in a large firm may never have taken or defended a deposition. They’ve prepared for them. They’ve prepared the partners for them, but they’ve never taken one, while in a small firm, they have the opportunity to actually do that. They get more hands-on experience, and that’s something a lot of people are looking for. They want actual skills. They don’t want to be in the back room all the time. It could be that the matters and the deals are smaller, but they’re getting a much higher level of experience, and that’s what they’re looking for.

Going along with that, they’re looking for mentorship and sponsorship, and really a culture of mentorship. In a large firm you can get lost, but in a small firm you can’t. That means you generally have access to partners and people who can help bring you along. If a smaller firm will develop and really put some meat and effort behind training and mentoring their attorneys, those attorneys are going to end up having a lot more hands-on, deeper and better experience than those coming from Big Law, so they may have more career opportunities going forward than their Big Law counterparts. They can actually lead, take on client or matter responsibility, lead a team, manage a matter or even try a case, the sort of thing that’s really not available in big firms. In some of the larger firms, only a few partners try cases, and in a smaller firm you may have more opportunity to do that sort of thing. Those are ways where smaller firms are sometimes in a better position to compete for those candidates, especially a mid-level associate looking around and saying, “Huh, I’m not really learning how to be the kind of lawyer I want to be.”

Sharon:   It seems like exactly what law firms are counseled to do in terms of retaining their attorneys, giving them the opportunities, that sort of thing.

Valerie:   Right, and that’s how you’re going to recruit them, too. That’s what we see here. We have lots of experience with that, where if we can say, “We replaced this associate at this firm and he or she has already done this, that and other in the six months they’ve been there,” that really excites other candidates who might be looking at that firm because they see the firm has actually put their walk behind their talk.

Sharon:   Have law firms gotten past the initial resistance to enlarging their pool of minority talent? Was there an initial resistance? Even when we first started talking about marketing there was initial resistance, like “Who needs marketing?” Now, it’s an accepted thing. Are we over that hump?

Valerie:   I think institutionally yes, individually maybe not always, but institutionally, yes. The reason for that is more so because they’re not going to get the work. The law firms are not going to get the work unless they diversify because the clients are putting the pressure on the law firms to diversify and that’s where it’s made a difference.

One of the things I wanted to talk about a little differently is that what you often hear the law firm say is, “Gee, I want to diversify, but we just can’t find those candidates that meet our criteria.” That is another way a smaller firm might be able to compete, if they look at more than just the pedigree of a candidate. Many of the larger firms are—of course, I’m just generalizing throughout this conversation—but many of the larger firms are very much stuck on, “Well, we only hire out of this list of law schools and we only go so far down in the class.” There have been a number of studies that have shown that pedigree is not necessarily tied to success in the practice of law. One of them is the 25 factors in lawyers’ success. There was a study done at Berkeley a number of years ago, and they found that often grades were counter-indicative of success in law firms when law firms are hiring for those grades. That was interesting. Another thing was the rainmaker study that was done. They found that the most successful rainmaking partners are those that went to the lesser law schools and maybe didn’t do quite as well. They didn’t come from Ivy League backgrounds because they’re hungry and they’ve always had to work harder.

Sharon:   Right, that makes sense.

Valerie:   The metrics are showing that hiring just from pedigree is not necessarily the best way to go, so one of the things happening now is there are more metrics that are going into the hiring process. That doesn’t change the initial policies set by many of the larger firms saying, “We’re only going to load our metrics to look at the top schools,” but there are more studies coming out showing there are other factors of success. Law firms that look at what it takes to be a success in their environment, with their kind of practice, with their clients and then hire for those factors are going to have stronger law firms and are also going to open the door to a wider variety of people.

Sharon:   Interesting. It’s good to hear that what you might think intuitively is being backed up by metrics.

Valerie:   Right. There is a general prejudice against changing, “Well, we only want the top schools, the top grades, and the sort of thing that’s always worked for us in the past.” It could be that in your particular environment those are the metrics that work. But I was at a California Bar program where the professors who did the 25 factors of success were presenting. They were talking about their factors and the studies they did, and one of the hiring partners from a major law firm said, “Well, you’re never going to get us to change. We absolutely must have the top schools and the top grades, because we are convinced that is it.” A lot of firms still operate that way and are going to continue to operate that way, but the firms that are able to be nimbler in a number of ways might find that they’re able to compete in a different way. They’re able to get a wider variety of lawyers on board and get the kind of business out in the marketplace that the large firms might be losing out on.

Sharon:   There’s real opportunity for smaller firms because, as you say, they’re more nimble and they’re willing to have a broader perspective.

Valerie:   Right, to try some different things. There’s a firm, Thompson Hine, who recently put together an assessment they started giving their summers, and now they’re giving it to the lateral hires as well. They looked at what it takes to be successful in their firm, and they created an assessment test that can measure those things. They give that to people before they’re hired. That’s something that’s new for law firms, but that’s not something new in the corporate world. Corporations have been doing that for a long time, but law firms might be catching on.

Sharon:   Those are great thoughts and if somebody wants to grab onto it, the chink in the armor created the opportunity. Valerie, thank you so much for talking with us today.

Valerie:   You’re very welcome.

Sharon:   For everybody listening, that wraps up another episode of the Law Firm Marketing Catalyst. If you’d like to contact Valerie, we’ll have her information in the show notes. If you like what you heard and would like to hear more, you can subscribe on iTunes or wherever you download your podcasts, and please rate us. We’ll be back next time with another thought-provoking guest who can help you move your firm forward. Thanks so much for listening.

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