In an edited extract from her speech to the Law Society's annual conference, President Fiona Woolf cals for the profession to change its public image.
I don?t agree with some who say that we are out of touch, out of date and out of ideas. As solicitors, we work closely with our clients across a huge range of private and business issues every day.
It?s time to turn the negative public image of solicitors round, so that we are no longer seen as fat cats ? but rather appreciated as trusted, valued, even indispensable advisers. Indeed, I think that we all have a responsibility to do what we can to turn that image round and to do it now. I take it as a personal challenge to begin the change.
Sir David Clementi and now Lord Carter have given us a wake-up call to respond to change. We?re good at responding to change and to competition, but this time we need to accelerate the pace and to do it with real vision and leadership.
We are not starting from scratch. We can build on the competitiveness and innovation of the profession, of which I am extremely proud.
It serves society well, in so many different ways. In international markets, UK law firms punch well above their weight. Our brand is highly regarded around the world. Solicitors underpin the services sector, on which the British economy now relies.
These days, one in four solicitors works in-house. They work beyond the purely legal aspects of the job to become valued leaders in management teams; 65% of general counsel regularly attend board meetings.
Solicitors deliver value for money. But do our clients always agree? After all, there are plenty of jokes about how expensive lawyers are.
At the high end, which accounts for the majority of our transactional and litigation work, competition is fierce. Most of the work is the subject of competitive procurement and we have to be innovative in finding new fee structures. My sense is that most large consumers of legal services know they are getting value for money.
As a profession, regulated to operate in the public interest, our vast contributions to the economy and government of this nation are seriously undervalued. So we must seek to tackle the current understanding of the value of solicitors.
In simple terms, the profession needs to perform for its clients ? to be clear about what clients need and to exceed their expectations. In turn, the Law Society needs to promote the profession?s interests strongly ? we call it ?supporting solicitors, so that we in turn can exceed your expectations.
If we are to ask the profession to perform well. It has to be regulated appropriately. My central aim this year is to secure a proportionate, risk-based and modern approach to regulation. Modern regulation must encourage competitiveness and innovation. It must recognise that we operate in a powerful market environment, under lots of pressure.
The prospect of the Legal Services Bill, as currently drafted, keeps me awake at night. The Lord Chancellor promised a light-touch supervisor, not the duplicating, micro-managing regulator that has been drafted into the Bill. It gives the legal services board (LSB) a host of wide and unnecessary powers that will be held like the sword of Damocles over the professional bodies. There are powers to set targets and to fine that don?t make sense in the context of setting standards, making rules and monitoring. There is even a power to intervene in the regulation of the profession directly.
These powers could seriously jeopardise the independence of the entire legal profession and the success of our solicitors in important international markets. I am pleased that the government has accepted our point that the legislation should establish clear thresholds for the use of these powers. The LSB should exercise its powers only if a regulator is clearly failing.
But we also need to change the policy on the appointments process for the LSB. The Lord Chancellor?s stated intention is that he ? and he alone ? would appoint the chair of the LSB directly. That risks the LSB being seen as a government quango of political appointees. The new regulatory structure will only work in the public interest if the LSB is independent on paper and in practice.
I recognise that the government has taken up our suggestion that the Bill should entrench the need to maintain the independence of the legal profession from government. Independence is the cornerstone of the profession. It is the fundamental guarantee we offer to our clients. An independent legal profession is a central and vital element of a functioning democracy. Pragmatically, it is essential to the health of the profession and the competitiveness of the legal services market.
The fear of the burden of regulation, and micro-management, exacerbates my worry about the cost. I have been present at the birth of new regulators for nearly 20 years. This is the first time that I have ever encountered the situation where the government proposes to bear none of the cost. This despite the recommendations of Sir David Clementi and the Joint Parliamentary Committee.
Solicitors will not thrive in a situation where there is regulatory confusion and ineffectiveness. And that is what I fear in relation to the Bill?s complex and confusing provisions on alternative business structures.
I?m the first President of the Law Society to spend all of my time representing the profession?s interests, unfettered by direct responsibility for regulation and consumer complaints. I am a fan of the separation. We are now able to press the regulatory arms for greater transparency and efficiency. We can provide a pro-active service on the representation side to improve regulation. The success of the model depends on our working together as one operation with ring-fencing and independent decision making, but not as entirely separate organisations.
Our other leadership challenge is in an area where there are definitely no fat cats. Parts of the profession give immense value for money at such bargain basement prices that they are at significant risk. Many of them are going out of business or turning their hands to other things.
I am talking about legal aid work, of course. This is a big issue for all of us ? whether we practise in-house, in the City or on the high street ? because solicitors are all committed to access to justice. It is also a huge issue for the public. Legal aid is a vital public service, right up there with health and education.
Solicitors go into legal aid work in large part from a sense of public duty. But that commitment to serving the public has been exploited. Those dedicated solicitors who commit themselves to legal aid work constantly struggle with hopelessly uneconomic fees and stifling bureaucracy. Most solicitors in England and Wales have had their legal aid fee rates effectively frozen since 1993.
Then along came Carter. I have taken a special interest in the Carter review from my background of putting in place market models in electricity, where it was thought to be completely impossible. From an economic standpoint, I simply do not believe that there is a rich vein of economies and efficiencies that can be captured in a market model that will transform legal aid. And any economist knows that if you want to create incentives for people to achieve efficiencies, you will have to let them retain some of the upside.
We commissioned an independent analysis of the impact of the Carter proposals on criminal legal aid firms from LECG, a highly respected group of economists. That report has confirmed what many of us had suspected and feared. Lord Carter?s proposals could spell the end for up to 800 legal aid firms, which may be forced out of business ? double the number predicted in his report ? and which provide a vital service to their communities.
The LECG report shows that the reforms can only succeed if there is more money on the table now to make the supplier base viable. Our campaign has already received strong support from al
l quarters of the profession ? from legal aid firms and non-legal aid firms; from small practices to some of the very largest. This demonstrates that we remain one profession.
I reject the argument that the profession is now so diverse that the Law Society cannot represent it all. The fact is we all share the same values, and have substantially common interests. We all care passionately about our independence, the rule of law and access to justice. We are proud of being regulated in a way that distinguishes us from the increasing band of unqualified pretenders in the legal services market.
We all want to be well regulated in a way that is proportionate and risk-based so that we are competitive. My contribution is a plan to put the spotlight on large firms, on trainees and solicitors in the first stage of their careers, and on in-house lawyers. Now we must ensure that we provide an effective and distinctive voice for each of these groups. We know that in-house lawyers have problems moving from one jurisdiction to another and have extreme difficulty in securing legal professional privilege in many countries.
As the first president to owe her position to the Association of Women Solicitors, I am glad that we have been able to wake the profession up to the benefits of equality and diversity. But we cannot afford to be complacent. Supporting solicitors means, among other things, supporting them in pursuing the equality and diversity agenda in a way that results in real integration and empowerment and not just ticking the box.
Most of the managing partners that I?ve met tell me that staff retention and job satisfaction are the most important issues that they have to deal with. So I am planning a project to collect and develop best practice with the accountancy and financial services sectors to provide some thought leadership.
We are developing new proposals designed to serve the public better. An example of this approach is our new proposal, which we have called ?Fast and Fair?, designed to modernise the small-claims process for the benefit of the justice system, and the ordinary individual. Our proposals will strip away delay and unnecessary bureaucratic procedure. This will improve the system for the public and improve the public image of the solicitors who operate it.
Everyone is telling us is that they want the Law Society to be a really strong voice ? a truly effective lobbying voice, that can convince government, but also one that can win the hearts and minds of the public. But leadership brings difficult choices ? can we be more political without undermining our credibility as a responsible organisation? I believe we can. Should we say ?no? robustly to unacceptable proposals, knowing that we might lose the fight? I believe we should. Must we show leadership in the face of inevitable change, even if some of our members don?t like what they hear? I believe we must.
The Law Society?s responsibility is to make the difficult choices to establish a really authoritative voice that will improve the image of the profession. As president, I will be working for us to be recognised for our massive contribution to UK PLC, our tireless legal aid and pro bono work, and for the high-quality, value-for-money advice that we give every day.
That is what professionalism means in the 21st century.
Fiona Woolf is the Law Society President. For a full transcript of her speech to the Law Society?s annual conference,