Does your firm have gender diversity and female leadership on its strategic agenda? Probably yes. Most progressive firms formulate their responses to societal and commercial pressure in similar ways: they introduce special mentoring programs, help women to balance work and family responsibilities, reconsider their brands and routines to attract talent and develop client relationships, and so on.
Does your firm have an answer to its WHY? Are you a purpose-driven law firm? Probably not. Most law firms don't have an explicit 'WHY-response'. In general, the concept of putting purpose (or WHY) at the heart of your company is new for many across all markets and sectors.
Just a few weeks ago the preeminent business circle in the US, the American Business Roundtable (BR) issued an open letter titled 'Statement on the Purpose of a Corporation'. The BR, which includes the CEOs of leading companies from Apple to Walmart, stated that purpose comes before profit. They wrote: 'Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities and country'.
Is this only a PR-step that managing partners of leading law firms should simply copy?
I believe not. Is this a result of the current wave of activism around climate change, data privacy and the future of our democracies? Well, 'the times they are a-changin'' and probably many of us, whether CEO of a blue chip in the US or Chief Innovation Officer of a Central and Eastern European law firm do reflect on responsibility, sustainability and success. But there is more to it than this. There is hard evidence that purpose-driven companies outperform others, grow faster and have higher profitability.
Why you should care about ‘WHY''
People don't just buy what you do, they buy why you do it.' says Simon Sinek, a popular leadership consultant and author. In his 'golden circle theory', he states that all companies know WHAT they do, some know HOW, but very few know WHY they do it. And those who do know, succeed over others who don’t; even if they have the same or even slightly less favourable conditions. In this age of abundance having a higher purpose behind your product or service is a differentiator: customers who identify with your 'WHY' will also identify with your product or service, and ultimately decide for it. Suppliers, business partners who share your value are also likely to be more loyal.
But formulating and living your purpose is even more important from an internal, organizational point of view. Research shows that if a company has a strong corporate purpose, its employees will feel greater meaning and impact in their jobs. And the aggregate sense of meaning and impact, i.e. purpose, tends to go hand-in-hand with profit. Why could that be? Daniel Pink, another best-selling author and speaker, argues that human motivation, especially for complex tasks is largely intrinsic, and is driven by having mastery, autonomy, and purpose. Although we in the legal industry also face commoditization and standardization, lawyers' tasks as such are still complex. And ask a legal business professional these days whether she or he does routine work... So, Pink's theory, also referred to as Motivation 3.0, is highly relevant for us. Do we provide mastery, autonomy and purpose?
Law firms by nature are built on a high level of autonomy, the partnership model favours an individual entrepreneur approach. Also, successful law firms still largely manage to hire the right people for the right job, so in general, 'having' mastery in connection with solving the given problem is probably common for most law firm employees. If autonomy and mastery are achievable, we 'only' have to work on purpose in law firms.
Last, but not least, academic research shows that putting purpose at the heart of your organization helps you with strategy. It helps to redefine the playing field, and to reshape the value proposition. You might be sceptical about law firms redefining their playing field. Well, one of the silver circle law firms, Pinsent Masons sees and describes itself as a 'global professional services business with law at its core'. Certainly, different that just competing on the legal services field. Why do I mention them? They have just received an award for being one of the first purpose-driven law firms…
So, starting with WHY, living a clearly defined purpose in your law firm makes sense from a strategic, organizational and marketing point of view. But what does it have to do with women? Why are purpose and women combined in the title of this article?
You need more women to find and live your WHY
Actively supporting gender diversity and female leadership might be one of the core missions of your organization. The importance and rationale of this have been discussed intensely in many studies and articles – in legal journals and elsewhere.
However, one aspect perhaps has not yet been examined in enough detail: the relationship between female leaders and purpose-driven organizations. Recent studies in behavioural psychology have found that women tend to be more purposeful and relational in their leadership. Of the nine leadership behaviours McKinsey research identified as most important for organizational performance in the future, several relate to a proactive, purpose-driven and people-focused leadership style. The style, which McKinsey argues, is essential in our VUCA environment. The behaviour, in which women score higher than men.
The future is female, the purpose-driven approach is even more so. Maybe also in the legal sector?
Reading list
I was inspired among others by ‘Start with Why’ by Simon Sinek; ‘Drive’ by Daniel Pink; ‘Finding the balance in leadership styles’ by Ellen Feehan, Johanne Lavoie, and Emily Tylor (McKinsey); ‘Put Purpose at the Core of Your Strategy’ by Thomas W. Malnight, Ivy Buche, and Charles Dhanarai, Harvard Business Review, September-October 2019; ‘181 Top CEOs Have Realized Companies Need a Purpose Beyond Profit’ by Claudine Gartenberg and George Serafeim
About the Author Andrea Miskolczi is the Chief Innovation & Business Development Officer at Wolf Theiss. She has over 20 years of experience in the legal business, both as a transactional lawyer and as a business manager. As the leader of a multicultural department with more than 20 people, she is responsible for Wolf Theiss' business development and innovation activities, including digital transformation of service delivery (LegalTech). Furthermore, Andrea leads marketing and communication, training and development, as well as certain organisational development projects regarding collaboration, innovation and knowledge management. She also participates in forming the strategy for Wolf Theiss. Before joining the firm as a counsel, Andrea has worked at leading international law firms in Budapest, London and Berlin.