In part two of this series of articles I looked in detail at the concepts of Corporate Social Responsibility (CSR), Responsibility and Purpose. I identified the clear need for business in general, but in this instance specifically law firms, to have at least the latter two but preferably the third of these as a major strategic focus in the business model. I would like now to take a look at an example from the real world of one of the very few firms that, currently, gets it right.
Mishcon de Reya is one of few firms that appears – at least through their website communications – to understand the strategic relevance of Purpose as opposed to Responsibility and CSR.
They start out by establishing a clear statement of what they understand by a purposeful way of working:
Managing risk, building resilience, transitioning to sustainability.
They then go on:
Our own core values and stated purpose, “to enable our clients and our people to shape the world’s possibilities” give us a clear-eyed view of the risks and opportunities presented by a rapidly changing world. With a reputation for taking a position, for having a wider view, and for backing our clients fearlessly at times of change, we view sustainability and Environmental, Social and Governance (ESG) issues as indispensable board-level considerations for responsible, resilient and successful businesses and families.
In this way they establish, clearly, that Purpose isn’t about donating money to charity or recycling paper (although, as we’ll see, they do this) but about the fundamental way in which they deliver legal excellence.
But, the eagle-eyed among you might note that this is within a service-provision context. What about the things they’re doing internally to ‘walk the walk’? They set out a manifesto not dissimilar to many firms:
‘…being socially responsible [is] a corporate responsibility, we believe in the importance of having a positive impact on both our local community and the wider world.’
Although there are many firms engaging in pro-bono work Mishcon de Reya has been purposeful in its choice of project. For example, in working with B Lab they have supported a number of companies moving towards B Corp certification (including ProperCorn, The Big Issue, Finisterre and Abel & Cole).
Similarly, although there are many firms that encourage employees to take time each year for volunteering, Mishcon has built on this to include a purposeful element. They are one of ten founding members of the Social Mobility Business Partnership, a unique and award-winning social mobility programme. The SMBP promotes social mobility in business, with a focus on the legal and accountancy professions.
This is echoed across their other core areas of activity: Sustainability and Diversity. Although as a partner of B Lab it is interesting to note that they are, themselves, not yet a B Corp, they are:
‘…undertaking a participatory review of [their] own business at the same time as [they] advise other businesses on their journey to sustainability.’
They are also committed to being a net carbon zero business, supported by a firm-wide policy, which has progressively driven emissions down year on year while offsetting any unavoidable emissions. They are also a member of The Chancery Lane Project – the code name for the focused and collaborative effort of lawyers from around the world to develop new contracts and model laws to help fight climate change.
I have looked at Mishcon de Reya here for a reason. They might not have the flashiest marketing communications about their CSR activities. They might not even have any really great reporting on much of their Responsibility work (and maybe they want to think about how to do this). What they do well, however, is show how Purpose runs through their firm like letters in a stick of rock (the Holy Grail of branding). Their internal ethos, operational tactics, marketing and client messaging all say the same thing… as a firm, they’re committed to delivering the very best legal expertise that is designed to make the world a better place.
Let’s talk about purpose in a bit more detail
Professor Alex Edmans tweeted a few weeks ago that:
“76% of investors expect companies to have defined their purpose, and 93% believe that purpose is necessary to set a long-term strategy that creates value”.
This responded to a survey conducted by SquareWell Partners, for which he wrote the Forward. An article on Harvard Law School Forum on Corporate Governance explained his views:
‘…there is increasing evidence that there is a business case for Purpose and that it is in investor’s interest to hold companies accountable for Purpose, rather than viewing it as an unnecessary distraction. Indeed, Professor Edmans argues that while business reformers have argued that Purpose can only become a reality if shareholder primacy is challenged, investors are not the enemy but partners in the repurposing of business. Professor Edmans points to the rigorous evidence that shareholder engagement doesn’t simply change the division of the pie, extracting profit at the expense of society, but instead grows the pie, making companies more productive and innovative, benefiting both shareholders and stakeholders alike.’
In preparing for this article I discussed the current COVID-19 crisis and the path economic and commercial recovery might take, within the context of Purpose. Professor Edmans was of the view that we’re at a crossroads in terms of whether we use the recent crisis as an opportunity to create long-term social value or stay with the old way of doing things:
“If no action is taken [to grow the pie] then the economic recovery will be the same – with most of the gains going to bosses and shareholders. In particular, the fact that we are now doing increasing amounts of business online means that there is even greater opportunity for a “winner takes all” mentality and economy because there aren’t any capacity constraints.”
Law firms are at a critical stage and occupy a unique position. Professor Edmans argues for an approach that considers a shared, increasing value across both shareholders and other stakeholders. In the majority of law firms, however, the shareholders are also those delivering the service, supported by a wider stakeholder community. Once again, the concept of silos presenting a barrier to success, when it comes to Purpose, is important here. The ‘them and us’ mentality of partners as opposed to other fee-earners, as well as of fee-earners as opposed to non-fee-earning employees is still alive and well in many firms. Maximising the strategic benefits of Purpose, for all involved, will require significant work to break down both operational and cultural barriers and silos.