Bigots, Cowards & Lawyers Oh My! What to do with law firm DE&I now...

While President Trump furiously signs executive orders, many huge employers signaled a retreat from their previously stated foundational commitments to diversity, equity, and inclusion (DE&I) initiatives. The about face has been shockingly fast, even for corporate America. Law firms - quick to capitalize - have started their own practice areas to advise clients on how best to change their faces but have also turned against their own DE&I principles, grappling with hypocrisy and the reality that everyone has a price (and their price isn't quite as high as they pretended).

For law firms, this is not only a moral failing but also a profound miscalculation from a risk management perspective. Law firms, in particular, must take note: scaling back DE&I efforts undermines professional obligations, exposes firms to heightened risks, and forfeits substantial opportunities for growth and excellence.

Picking on law firm powerhouses Gibson Dunn, Perkins Coie, and Morrison Foster (don't feel bad, they've got a combined revenue of over $4.5 billion, just above Liberia's and below Fiji's GDP), many law firms are folding like cheap suits, kowtowing to the administration even faster than they jumped on the Pride Month bandwagon in the first place!

Defining DE&I

DE&I definitions are sort of like Supreme Court Justice Stewart's definition of porn: you know it when you see it (or at least you think you do). Of course, the way you define it tends to track your political leanings. But to drill down to the core concepts, I like a poker analogy:

DE&I poker means having a full deck of 4 suits and 13 values (diversity), dealing everyone the same number of cards (equity), and making sure everyone gets a turn to place bets (inclusion). What we’re not talking about is discriminatory action, well intentioned or not (like inheriting cards from prior hands, some getting dealt twice as many cards, or playing by a different set of rules).

A Legal Profession Rooted in Ethical Obligations

The ABA's Model Rules of Professional Conduct explicitly emphasize our duties of competence, diligence, and promoting justice. Rule 1.1 demands competence, which is inherently strengthened by a diverse and inclusive workforce. Diverse teams bring varied perspectives that enhance problem-solving and decision-making. They also attract and retain diverse clients. While far from universally accepted, Rule 8.4 explicitly prohibits discriminatory conduct in the practice of law, making DE&I not just aspirational but essential to compliance.

Law firms are uniquely positioned to lead by example in the DE&I space, and abandoning such efforts (especially in such a spineless fashion) runs counter to these ethical obligations. When law firms fail to prioritize DE&I, they risk eroding trust with clients, courts, and the communities they serve, potentially leading to reputational harm and ethical violations.

Risk Management and DE&I: The Inextricable Link

Scaling back DE&I initiatives is not just morally ugly—it’s also a poor risk management strategy. Here’s why:

1. Increased Liability: DE&I initiatives help mitigate risks related to workplace discrimination, harassment, and bias. Without robust DE&I frameworks, firms should expect to see an uptick in internal complaints, external litigation, client dissatisfaction, and regulatory scrutiny, all of which are costly and damaging.
2. Reduced Competence: Studies consistently show that diverse teams outperform homogeneous ones in solving complex problems and delivering innovative solutions. By deprioritizing DE&I, firms risk stagnation and reduced overall competence, which directly impacts client outcomes.
3. Client Expectations: Many corporate clients have made their own DE&I commitments and expect their law firms to do the same. While many mega-companies are folding faster than our White Shoe law firms, smaller fish law firms that fail to demonstrate alignment with these values risk losing key clients to competitors who actually prioritize DE&I.
4. Reputational Damage: In a world where consumers and clients are increasingly values-driven, a public retreat from DE&I will likely lead to significant reputational harm. This damage often translates into lost business and diminished trust. While many law firms bank on clients forgetting their commitment to DE&I from a few months ago, the internet lasts forever and the inevitable political pendulum swing will let us all reap what we sow.
5. Missed Business Opportunities: Diverse teams are better positioned to understand and meet the needs of an increasingly diverse client base. Firms that invest in DE&I initiatives can tap into new markets, attract a broader array of clients, and enhance client satisfaction - after this sorry two-faced display, cowardly law firms will have difficulty convincing their clients of their DE&I commitment down the road.

DE&I as a Competitive Advantage

Rather than retreating, law firms should be doubling down on their DE&I commitments. Here’s how:

1. Integrating DE&I with Professional Standards: Ensure that all DE&I initiatives are explicitly tied to compliance with the applicable Rules of Professional Conduct. This not only strengthens the ethical basis for such programs but also ensures alignment with the firm’s broader mission.
2. Continuous Education: Provide regular training to all attorneys and staff on implicit bias, cultural competence, and inclusive practices. This bolsters professional competence and minimizes the risk of unintentional bias in legal work.
3. Diversifying Leadership: Leadership teams that reflect diverse identities send a powerful message about the firm’s actual commitment to DE&I and set a standard for the rest of the organization.
4. Enhancing Recruitment & Retention: Invest in robust recruitment strategies that target diverse candidates and establish mentorship and sponsorship programs to retain diverse talent.
5. Measuring & Reporting: Establish clear metrics for DE&I progress and share these metrics with clients and stakeholders. Transparency builds trust and holds the firm accountable.

For law firms, DE&I is not a rainbow mask to be put on or taken off as the winds of change blow—it’s a business imperative and an ethical obligation. Regardless of politics, scaling back on DE&I initiatives is a step in the wrong direction, both morally and strategically. Firms that embrace DE&I will not only comply with their professional responsibilities but also position themselves as leaders in the legal profession, equipped to manage risks, attract clients, and drive innovation.

The question is not whether law firms can risk a continued commitment to DE&I in today's America, the real question is: is there any coming back from today's cowardice?

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