Focus: Beachcroft, Going public
27 July 2009
How Beachcroft quietly propelled four of its top lawyers into the most influential policy roles in the legal profession
Many law firms are proud of their public service efforts. But there is one firm that has applied strategic method to how its partners volunteer their services. The result has been that it now has partners and legal executives holding some of the most powerful public positions in the profession.
The firm is Beachcroft. Former managing partner Bob Heslett took office as the Law Society president last week (22 July). Just days before, Beachcroft senior legal executive Judith Gordon-Nichols became president of the Institute of Legal Executives (19 July). David Hunt, a former Beachcroft senior partner, continues his investigation for the Law Society-commissioned report on how the profession should be regulated, while strategic litigation head Andrew Parker is a close adviser to Lord Justice Jackson’s review into litigation costs.
Keen to put forward the Law Society’s perspective and not that of his firm, Heslett says the fact that Gordon-Nichols’s appointment coincided with him being elected to office at the Law Society was nothing more than “serendipity”.
“Judith joined in 2002 and I stood down as managing partner in 2005; there’s little overlap,” he insists. “We’ve encouraged people to go for judicial appointments. [Beachcroft] has a strong public service ethos and a long history of that. The Law Society also wants people to take up public appointments. We want to encourage firms to allow partners and trainees to take up judicial posts. It’s a part of pro bono work and I want to see that happening.”
According to Beachcroft managing partner Paul Murray, encouraging partners and employees to take up appointments adds to the firm’s professional reputation.
“It’s hard to see the immediate payback, but it does reflect well on the firm,” he believes.
Murray says Hunt’s political career flourished while he was still a practising lawyer. He became an MP seven years after he was made a partner and a year after he was elected to managing partner.
According to Murray, Beachcroft has accommodated Hunt’s career because he was and still is a practising lawyer. The firm has learnt lessons from being flexible to partner needs beyond the firm, he adds.
“We’re happy to entertain suggestions,” Murray explains. “For example, we have an annual review and we look at what people want to do. We discuss each possibility and there are times when it’s impossible.”
“Some would suggest that having a government minister among your ranks isn’t necessarily a bad thing,” says one insider. “Not only is it good for reputation, but it also shows clients that we’re well positioned.”
Another former partner agrees that high-profile appointments can be good news. But he warns: “You do have to think about the firm too. When these people are off doing their corporate responsibility shindig, what’s happening to their earning capacity? Beachcroft has to concentrate on its commerciality - rates in the volume area are dreadfully low. How can they justify charging below market rates for such high-profile lawyers?”
Heslett’s earning capacity will be zero for the next year as Beachcroft has agreed for him to take time off to concentrate on the huge challenges facing the Law Society. It is arguably going to be the body’s busiest year ever. Heslett takes up the presidency as the profession is on the cusp of monumental change, forcing the Law Society to address how to best represent members’ interests.
While his was not a strategic appointment, Heslett is a diplomat who gives measured and well thought out responses to the questions put to him. Murray describes his predecessor as “approachable, charming, a fluent communicator”, somebody who could drive change at the Law Society.
Heslett has already illustrated these credentials. Keen to draw a line under recent spats with the Solicitors Regulation Authority (SRA) over the creation of its new board, he emphasises that the regulator, despite its protestations, is an independent body free of interference from the Law Society.
To reinforce the point, the Law Society has appointed Herbert Smith consultant Charles Plant to chair the new board. Plant will have a four-member panel - including one Law Society representative - to appoint the board, which will decide on the SRA agenda for the forthcoming year.
Being careful not to tread on any toes, Heslett comments: “We’ll wait and see where we can help the SRA in its aim to achieve first-class regulation. What we want is excellent regulation that provides the profession with a strong competitive advantage.”
Yet this could be the main bone of contention between the SRA and the Law Society for the forthcoming year. In September Hunt will publish his report on how he envisages the profession should be regulated. First it will be reviewed by the Law Society but then the report will passed onto the SRA for it to decide on any relevant action.
“I hope [the report] will be the catalyst for discussions about the future provision of legal services by solicitors,” Heslett says in his typically diplomatic tone. “Only the SRA can change things, and any substantial change would have to have the approval of the Legal Services Board [LSB].”
As part of his investigation Hunt commissioned the former senior Ministry of Justice civil servant Nick Smedley to look at whether there is a need for a separate regulatory function for firms with commercial clients. His report, which will form the basis for Hunt’s feedback, recommended that the SRA establishes a unit specifically for corporate firms with commercial clients.
“The gap between the regulator’s skill set and the work of the corporate sector is too wide to enable the SRA to act with confidence and competence,” the report said.
Until now the Law Society has kept quiet about the review, but Heslett is willing to speak out.
“Without trying to anticipate Hunt’s findings, I hope a lot of the Smedley recommendations find favour with the SRA,” he says. “I do know that the majority of lawyers want to see what I would call empathetic regulation - regulation that in its application reflects the particular position of the many diverse firms.”
This is as close as Heslett comes to saying the Law Society wants separate regulation for those firms with corporate clients. But the body is under pressure to make sure the SRA listens. Soon firms will have to compete with non-lawyers for business. Efficient regulation is a selling point that the Law Society must promote to help its members compete in a post-Legal Services Act world.
It will have to apply pressure to the LSB (which comes into being on 1 January) and the SRA to ensure a complete review of regulation takes place. The LSB has the regulatory review high up on its agenda for 2010 and will also be looking at the rules governing the alternative business structure market.
These are new issues that the Law Society must be seen to be dealing with. It must be sure of its own policies, ensure they are supported by the profession and then communicate them efficiently to its members, regulators, government and the public.
“There’s a great deal of frustration at the lack of noise from the Law Society when there’s so much in the profession to be proud of,” says Trethowans managing partner Simon Rhodes. “It’s time to turn up the volume.”
This includes speaking up when the profession is brought into disrepute by lawyers found breaking the rules. When the Solicitors Disciplinary Tribunal reprimanded lawyers involved in the miners compensation scandal, the Law Society decided against speaking out to defend the reputation of the profession.
The Law Society will have the opportunity to raise its profile when the Office for Legal Complaints (OLC) replaces the Legal Complaints Service late next year. The OLC will be the extension of the LSB, rather than the SRA, widening the gap between the representative body and the complaints handler.
“I would also stress that we want fast, vigorous action taken against those very few solicitors who persistently break the rules,” says Heslett. “There’ll be an entirely new approach.”
The pressure is on the Law Society to ensure regulation is vigorous because soon some firms will be competing with non-lawyers for work. While there may not be an avalanche of new competitors, it will open the volume market to non-legal players.
“The Law Society favours choice and wants to do all it can to see a level playing field on regulation between existing and new entities,” Heslett insists. “Also concerns about access to justice are thoroughly responded to in the provision of licences. We want to be involved.”
For Beachcroft, public service is a matter of duty encouraged by the management. This presidential year Heslett must transform the Law Society into a modern representative body capable of fighting publicly in favour of the profession.
It is going to be a busy year that will give Heslett the opportunity to shape the future of the legal profession.