The Board met in person on 25 April 2023, my first meeting as Chair of the Legal Services Board. I reflected to my Board colleagues that, less than a month into the role, it had been a delight to have already met a wide range of stakeholders committed to delivering positive improvements for consumers. I look forward to meeting more people and organisations who share our vision, and I am committed to ensuring that modern, well-targeted, proportionate regulation plays the fullest role possible in achieving the objectives of the Reshaping Legal Services strategy. We have several projects in our recently published business plan pipeline to drive forward our vision, and I look forward to keeping you up to date with developments.
Ensuring high standards of professional ethics and upholding the rule of law
The Board noted significant progress in our work to explore and gain consensus across the sector on what upholding the rule of law means for expectations of professional, ethical conduct on the part of legal professionals.
We welcomed feedback from our roundtable event on 27 March, where we brought together regulators, representative bodies, legal professionals, academics and civil society groups to discuss the need for a clear regulatory framework to support legal professionals to identify ethical issues and guide their decision-making. There were also calls for strong leadership from the sector to ensure that culture in the profession is focused on upholding the rule of law in the public interest.
We considered that although consistency in regulators’ codes of conduct and guidance on good practice across the sector is in general desirable, different areas of legal practice and the different settings that legal professionals operate in (especially, for example, in-house or in firms/chambers) may need guidance focused on the specific types of issues which may arise for them. There could be opportunities to learn from other regulators, e.g. medical regulators, as we continue to gather evidence and explore how regulation should evolve to ensure strong professional ethics that uphold public confidence right across the sector.
Upcoming call for evidence on the misuse of non-disclosure agreements
We also discussed our call for evidence on the misuse of non-disclosure agreements (NDAs) which will be published shortly. The misuse of NDAs is a specific example of where the conduct of legal professionals may undermine the rule of law and the public’s confidence in the legal sector. Our call for evidence focuses on this and on how regulation might help to address the issue by better supporting legal professionals to meet their ethical obligations.
The Board noted the importance of understanding the lawful and legitimate use of NDAs and is seeking evidence about the scale and nature of their misuse to conceal wrongdoing, as well as the effectiveness of existing regulatory responses to misuse. We also discussed the potential for future targeted work to respond to other specific concerns about legal professionals’ conduct, such as in relation to Strategic Lawsuits Against Public Participation (SLAPPs).
Assessing regulators action plans to meet our ongoing competence outcomes
We reviewed the regulators’ progress in meeting the outcomes in the ongoing competence policy statement we issued last summer. It aims to ensure legal professionals maintain the necessary, up to date skills, knowledge and behaviours to provide good quality legal services throughout their careers.
Board members welcomed the positive initial steps the regulators have taken, noting that regulators have committed to a range of initiatives to ensure they have the right standards to promote ongoing competence, improved intelligence about levels of competence in their regulated communities, appropriate upstream measures to prevent competence being degraded over time and the readiness to respond to instances of poor competence through supportive remedial action where possible.
Board members observed the close links between this workstream and the work on the rule of law, as both projects are intended to support strong professional ethics, as well as links to our review of guidance on education and training. We discussed the value of effective continuing professional development (CPD) in conjunction with other measures, and 360 feedback, in particular, was identified as a useful tool which could be more widely adopted in legal services to promote continuous improvement and embed learning from practice.
We emphasised the need to closely monitor progress and be ready to take further action if the current positive trajectory was not maintained in the interests of consumers, who should be able to trust that their legal professional is competent. Regulators are expected to meet the outcomes of the statement by January 2024.
EDI programme update
We heard about the progress made over the past 12 months in a number of areas to address issues which impact the diversity of the legal sector and about the plan for the next phase of the LSB EDI programme. The Board welcomed the work in brokering agreement from the legal services regulators and tribunals to the principles for tackling counter-inclusive misconduct through disciplinary processes (June 2022); and encouraged feedback on its effectiveness and on improving understanding of the causes of disparities in disciplinary decisions. Progress was also noted on the Judicial Diversity Forum action plan, on which the LSB facilitated a streamlined plan published in December 2022.
EDI ‘‘lived experience’’ research
We considered the report we commissioned on lived experiences of those who have faced counter-inclusive practices as they enter and progress in the legal services professions. We noted the richness of this qualitative research while being careful not to assume that these comprehensively reflect the legal services professions as a whole. These insights will be considered alongside the data on diversity and inclusion at different levels of seniority.
The reported impacts on well-being, productivity and culture were noted and the Board’s emphasis continues to focus on the practices that make some individuals feel excluded. The link was made between the call to embrace equity on International Women’s Day and the difference and tension between ensuring equality (where everyone is offered the same) or equity (where support varies to get the same outcome). We noted that this research is there to inform our policy thinking and the next steps for our policy and research.
Finance update
I share my predecessor’s commitment to ensuring that the LSB, being levy-funded, continues to manage resources carefully and delivers value for money. We considered the finance paper for the full financial year 2022/23 and reflected on how agile financial management enabled the organisation to respond to unforeseen new priorities, including ensuring the effectiveness of the financial sanctions regime in the legal services sector and undertaking an investigation into disputes and disagreements between the Chartered Institute of Legal Executives and CILEx Regulation Limited. Despite the inevitable occurrence of unforeseen issues such as these, the Board warmly welcomed the success of the LSB team in securing a near-perfect balance of budgeted and actual expenditure across the year – a result that benefits all our stakeholders.
We are, in short, using our resources effectively, helping to ensure that regulation delivers positive improvement for consumers and society. The draft resource accounts, based on these figures, have been submitted to our external auditors. The external audit has now commenced and will take place over the next three weeks.
The next Board meeting is on 6 June 2023.