You are here

Partners failing to take responsibility for risk management

Error message

Warning: fopen(/home/demo/public_html/solicitorsjournal/shared/tmp/filecache-default/cache_block-wsj_content wsj_content_related_content solicitorjournal http ^^www.solicitorsjournal.com^news^management^business-development^partners-failing-take-responsibility-risk-management): failed to open stream: Invalid argument in DrupalFileCache->set() (line 238 of C:\inetpub\soljournal\sites\all\modules\filecache\filecache.inc).

Should be measured and rewarded for managing risks to firms, Managing Partner survey finds

11 June 2014

Add comment

Partners need to take greater responsibility for risk management to better protect their firms.

That's the overwhelming view of respondents to Managing Partner's inaugural risk management survey, the full results of which will appear in the July/August double issue and online later this month.

"Too many partners see risk management as something which is a responsibility of others," commented the general counsel at one international law firm.

Added the risk director at a local UK firm: "All partners have a part to play in supporting the risk director with the implementation and continual development of the risk management programme."

A key issue is failure by partners to prioritise firmwide risk management over client work.

"They are getting better at managing client risk but not so much at protecting the firm (clients come first)," commented the risk director at another international firm.

Seventy-one per cent of respondents said that partners need to take greater responsibility for risk management in their firms.

A similar amount (73 per cent) said all lawyers should be measured and rewarded on how well they manage risks to the firm. However, for 61 per cent, their lawyers are not currently measured and rewarded on this basis.

Commented the managing partner of one regional practice: "It is measured but does not attract reward."

Among the respondents that are working on introducing this, various approaches are taken.

"We currently deduct profit costs from those lawyers who have notifications or complaints because they are the ones who just want to bill well but do not see the downside," said the risk director at a local firm.

The biggest risks that lawyers are currently incentivised to manage are: billing (76 per cent); client due diligence (55 per cent); fee collection (50 per cent); client communications (47 per cent); and case/matter management (47 per cent).

The lowest-ranking risks for firms, according to how respondents' lawyers are currently rewarded, are pipeline management (8 per cent); project management (11 per cent) and ethical screens (16 per cent).

Less than a quarter of firms (24 per cent) incentivise data security in their lawyers.

Originally published in Managing Partner

To find out more about this and related issues, visit our sister publication Managing Partner

Categorised in:

Business development & Strategy