The Future of Law Firm Culture:
Challenges and Opportunities in a Changing Landscape

 

On May 21, 2025, Law.com International, in association with Diversity Lab, hosted the webinar The Future of Law Firm Culture: Challenges and Opportunities in a Changing Landscape.

The conversation around diversity continues to evolve. In 2025, several US law firms have scaled back their public engagement in this area, while European organisations have maintained a strong emphasis on diversity in their strategic direction. As these shifts unfold, the discussion examined both the differences and similarities in how firms across the US and Europe are approaching diversity, inclusion, and workplace culture.

The conversation was moderated by Paul Hodkinson, Editor in Chief, Global Coverage at ALM who was joined by Lisa Kirby, President of Inclusive Talent at Diversity Lab; Kate Dodd, partner at Pinsent Masons and Head of Brook Graham; and Justine Thompson, Executive Director at InterLaw Diversity Forum.

The discussion began with a focus on the last six months, particularly on how the new US administration’s guidelines have prompted many law firms to reassess their diversity initiatives, with several scaling back their publicity in this area. Some UK-based law firms have also followed the US example, though their changes have been more gradual.

This shift in law firms’ approaches led to a key question at the core of the discussion: “Why do we campaign for diversity?”

Lisa highlighted a fundamental issue: the demographics of law school graduates do not align with leadership representation in law firms. Diversity has not developed organically, despite significant advancements in educational access. For instance, women have comprised over 50% of law school graduates in the US for years, yet only 24% of female lawyers hold equity partner positions in large firms nationwide. This disparity is not limited to the US — similar trends exist in the UK and Canada, though with varying percentages.

Additionally, decades of research have shown that diverse teams consistently perform better. Studies confirm that teams with varied perspectives make stronger decisions, whereas homogeneous teams tend to fall into fixed ways of thinking, which can result in less effective problem-solving.

The discussion naturally led to a broader reflection on how law firms have reached this stage in their diversity efforts. Justine, drawing from her experience, raised a critical consideration: “Do law firms offer a level playing field?”

The answer, she pointed out, is definitely no. One of the biggest concerns is that many lawyers carry a sense of shame about their background and how they fit into the legal sector. Their experiences working in law firms often reinforce a feeling of not belonging.

Justine shared her perspective from her early career as a graduate recruiter at a major international law firm — going back 20 years, there were already concerns about the diversity of hires and the composition of the talent pool. When reviewing the data, there was a clear disparity between the diverse candidates applying and those who were actually hired. Once they dug deeper, it became evident that the entire hiring process had flaws — from recruitment practices to who was making decisions at each stage.

Even after addressing those structural issues, a new challenge emerged — diversifying the training intake wasn’t enough. Firms also had to ensure that these candidates had a fair experience once they joined, rather than just ticking a box on recruitment statistics.

While good work is happening in this space, there is also a growing concern that diversity has become part of a law firm’s PR machine — something firms publicly champion but fail to meaningfully embed within their culture.

The UK Social Mobility Index — a ranking of the top 75 UK employers doing great work in social mobility — shows that six of the top ten employers listed are law firms. But despite this ranking, the legal sector is not truly leading on social mobility. According to Justine, law firms have become too focused on performative efforts over real problem-solving. Instead of identifying key issues and addressing systemic barriers, firms have often focused on looking good publicly rather than making real change internally.

She believes law firms started losing their way around diversity long before 2025 — this problem has been building for years and has a long tail that needs serious attention.

The conversation naturally shifted to Kate Dodd, who has experienced diversity challenges from both sides — as a campaigner and a lawyer.

One of the central issues raised was the US administration’s stance on DE&I initiatives, with concerns that some practices had gone beyond a balanced approach.

Kate addressed this by emphasising that there has been misinterpretation in the UK regarding statements made in the US. She clarified that the US focus has been on illegal DE&I practices, but the practices deemed unlawful in the US were never legal in the UK either. The UK legal framework is very clear about what is permissible — positive discrimination has always been illegal, whereas positive action is allowed and continues to evolve.

Kate reaffirmed the importance of diversity in the legal profession, drawing on her experiences since beginning her career as a trainee. With 25 years in law, she noted that progress in representation has remained slow, particularly concerning the advancement of ethnic minorities in large firms. Awareness and training are essential for meaningful change. While many firms acknowledge these challenges and are taking steps to address them, there is a tendency to overlook ingrained biases and long-standing practices that hinder diversity efforts.

The conversation moved to the differences in approach between US and UK-based law firms over the past six months. With notable changes taking place, a key question emerged: “Where does this leave firms operating on both sides of the Atlantic?”

Lisa shared insights on the current landscape, describing the past few months as turbulent, with firms still adjusting to the evolving environment. Despite media narratives suggesting a widespread cancellation of DE&I programmes, informal polling and surveys — particularly among Mansfield certification participants — tell a different story.

Most US firms are not making drastic changes to their diversity policies but instead refining terminology rather than shifting the substance of their commitments. Many of these policy revisions serve to formalise inclusivity, such as explicitly stating that affinity groups are open to all — even though, in practice, they already were.

The approach in the UK appears to be less volatile but more cautious. UK firms, especially those with offices in the US, are closely watching broader trends, balancing external pressures with internal commitments.

The conversation shifted to the evolving language surrounding diversity efforts: “Are firms moving away from terms like ‘diversity’ and the DE&I acronym – and does that actually make a difference?”

Justine explained that the impact of these changes is both significant and subtle. Drawing from findings in InterLaw’s survey on UK and US-headquartered firms, Justine noted clear differences in how employees in each region perceive their firm’s approach to diversity. Responses showed a distinct shift in how firms reaffirm their commitments — both internally in corporate culture and externally.

The conversation then addressed how law firms in the US and UK differ in their political alignment. While firms in the US often display stronger political affiliations, UK firms tend to maintain a more neutral stance, focusing on solidarity within the legal profession rather than ideological position.

Kate highlighted that there is often a lack of understanding in the UK about what is truly happening within the US legal landscape. Public perception tends to overestimate the severity of changes, in part due to reporting gaps — many legal developments, including successful challenges to restrictive policies, do not always make UK headlines.

Rather than abandoning diversity efforts, firms are increasingly reframing discussions, using terms such as ‘belonging’ and ‘culture’ instead of simply DE&I. These changes are not about eliminating diversity initiatives, but rather adjusting how they are presented.

However, this sudden shift in wording has led some to perceive it as a reactionary move rather than a thoughtful, strategic evolution. Beyond policy and terminology, the human impact of these decisions — on morale, well-being, and career sustainability — is significant. As firms reconsider their approaches to diversity, they must account not only for external factors but also for internal consequences that affect their employees and workplace culture.

As the discussion progressed, an important question emerged from the audience: “What is the role of data and reporting, both internally for driving change and externally for transparency and benchmarking?”

Lisa emphasised that DE&I efforts cannot succeed without robust data tracking. Historically, many firms assumed that setting up mentoring programmes and affinity groups would directly impact diversity, but results showed otherwise. For years, firms hesitated to collect diversity data, largely due to compliance concerns. It wasn’t until a decade ago that firms began tracking DE&I data properly, allowing them to assess real progress. This is why external accountability programmes, like Mansfield, play a crucial role in measuring impact. Programmes that integrate real data tracking help ensure progress while identifying areas where firms fall short.

Lisa also noted that UK firms above a certain size must comply with reporting requirements under the SRA, an example of forced accountability. While this mechanism ensures that firms measure and report their progress, data collection remains a fundamental pillar of effective DE&I strategies. Without it, initiatives will always struggle to hold weight.

Justine took a more critical view, describing the SRA reporting requirement as a blunt tool— while it provides numerical insights, it often lacks the depth and nuance needed for meaningful change. She stressed that data alone isn’t enough—firms must also ask the right questions and look at numbers in detail to identify real disparities.

For example, Justine worked with a firm that analysed opportunity and hours billed across practice groups, office locations, and geography. Given law firms’ reliance on billable hours, this provided a clear metric — something many industries lack. The findings revealed significant disparities, with white lawyers billing, on average, 600 more hours per year than ethnic minority lawyers. That is not just a minor gap — it is a systemic issue.

Justine cautioned against launching programmes, campaigns, and strategies without proper data tracking. These efforts often lack clear accountability, resulting in limited impact. She posed a crucial question: “Are firms using the right data in the right way?”

Because if firms aren’t tracking the actual barriers, they can’t measure whether their solutions are effective.

Questions from the audience turned again to the terminology surrounding DE&I efforts, particularly pointing out how the acronym itself has become a point of contention. In the US, DE&I has become a hot-button term, leading some organisations to spell out ‘Diversity, Equity, and Inclusion’ to reduce negative reactions. But does the same approach make sense in the UK context?

Kate acknowledged that discussions around diversity and inclusion often receive an eye-roll reaction in certain circles — particularly from those in the majority, who may not see the direct benefits for themselves or their future generations.

Kate emphasised that one of the most important strategies in working with firms is helping people understand that everyone is diverse. DE&I is not a zero-sum game — it isn’t about focusing on one minority group at the expense of others. Instead, it’s about lifting everyone up and ensuring equal opportunities for success. One of the unexpected positives of the backlash against DE&I in the US is that it has pushed conversations into the open. It has prompted more individuals to ask, "What about me?" — a question that, despite its challenges, can lead to more honest, productive discussions.

The audience then raised the question: “Have politicians pushing the DE&I agenda commented on its implications for the UK Equality Act and the American Disability Act?”

Since discrimination is already illegal, the debate appears to be more about preventing positive discrimination rather than challenging existing anti-discrimination laws.

Another question raised was whether the panel itself lacked diversity and suffered from insider bias. Kate responded by urging caution in how diversity is framed, questioning whether the conversation is being narrowed down to skin colour and gender alone. She highlighted that diversity is far broader, encompassing social mobility, mental health, disability, geographical diversity, and diversity of thought. The risk, she argued, is that by focusing only on visible diversity, the conversation fails to acknowledge the full spectrum of inclusion efforts. This led to a broader reflection on who diversity initiatives truly serve and whether these conversations are addressing the full range of structural disparities.

To conclude the conversation, the audience raised two final questions: “How can firms tackle the negative cultural backlash surrounding DEI?”, “What positive actions are firms currently taking to create meaningful change?”

Justine emphasised that addressing negativity requires a focus on compassion, citing insights from the Edelman Trust Barometer. While DE&I discussions often become contentious, it is crucial to recognise that many effective workplace initiatives are not explicitly labelled as DE&I, yet they significantly improve fairness and inclusion.

One standout example is big hand-run resource allocation systems, which remove subjective bias from how work is assigned within law firms. Traditionally, partners might walk the floor and handpick associates for a matter, creating opportunities for favouritism. These new systems interrupt that cycle, ensuring work distribution is fairer and more data-driven. Although such initiatives are not officially DE&I programmes, their impact is undeniably positive — diversity thrives when fairness and equal opportunity are prioritised.

In the UK, efforts have extended beyond diversity hiring to focus on mental well-being, long-hours culture, and the broader pressures within legal workplaces. DE&I must go beyond pure representation — it must create environments where employees feel safe to discuss challenges openly. Without psychological safety, even traditional diversity efforts struggle to gain traction.

Lisa added that talent practices and hiring strategies are evolving in response to diversity concerns. She highlighted a US-based recruiting company working with large firms to identify key predictors of success — moving away from traditional hiring metrics like law school grades.

A key takeaway from the discussion was the universal benefit of inclusive policies, as illustrated by accessibility initiatives like the Americans with Disabilities Act (ADA). Lisa cited curb cuts — originally designed to accommodate wheelchair users, but now used by everyone, including travellers with suitcases, parents with strollers, and even cyclists. Such examples demonstrate that accommodations for one group often lead to broader societal benefits.

Both Justine and Lisa stressed that DE&I isn’t just about benefitting specific groups — it’s about creating systems that work better for everyone. Firms must move beyond performative efforts, ensuring that diversity strategies are embedded within business practices rather than seen as isolated initiatives.

As the discussion highlighted, DE&I strategies and workplace culture are evolving, and this conversation isn’t going away. Firms will continue to navigate challenges and opportunities, adapting their approaches to diversity, inclusion, and social mobility in a rapidly changing environment.

For those interested in exploring these issues further, the upcoming Leadership in Law Conference in London on December 4 will provide an opportunity to dive deeper into these key topics. The event will examine how law firms and individuals can refine their strategies and adapt in the year ahead. 

Thank you to our panellists for their valuable insights and to everyone who joined us. We look forward to keeping you informed as developments unfold and to continuing the conversation.