"Grappling with compliance? Keep practising": Compliance workshop for BME firms

Location: Lexis House

A free workshop and networking event hosted by the Black Solicitors Network (BSN) offers guidance on authorisation and compliance for black and minority ethnic (BME) solicitors. Open to all BSN members, the event includes a key note speech from SRA Board member and Equality, Diversity and Inclusion Committee Chair Jane Furniss.

Key note speech - Furniss, J

Good afternoon; along with Cordelia and Jon it's our absolute pleasure to welcome you to this first joint event for members of the Black Solicitors Network.

For those of you who don't know me, I'm Jane Furniss. I'm a member of the SRA Board and I chair the SRA's Equality, Diversity and Inclusion Committee. So I am deeply involved in our work to improve our approach to regulation and in decision making and to better understand and address the causes of disproportionality in regulatory outcomes.

These issues were central to Professor John's report following his Independent Comparative Case Review and there has of course been, and continues to be, a lot of interest in how we are addressing the findings of that report. Today I will be updating you on the progress we've made.

This event demonstrates our determination to work with you and others to ensure that regulation is fair and proportionate. We are joined by staff from across the SRA who will engage with you on some of the very practical aspects of compliance, and I hope you will leave this evening with some helpful tools and tips to help your firm meet its obligations.

But far more importantly, I hope today we get the message across that the SRA has a human face; that we're approachable, that we deal with issues constructively and that we are, quite simply, open for business.

We know that for too long, contacting the SRA has often been a measure of last resort. That many firms, particularly small firms, are too scared of engaging with us when they are struggling, or when things might be going wrong, for the fear of finding our enforcement team on their doorstep.

We have done work a lot of work to try and change this perception and increase confidence in all parts of the profession, but we know we need to do more to change how we are perceived as a regulator.

We want firms to be able to pick up the phone and talk openly with us if they are experiencing the types of issues which could, if not addressed, result in our involvement.

I hope today we demonstrate that we are keen to listen, to engage and to support, so rather than spending time trying to second guess your regulator you can get on doing what you do best – providing an excellent service to your clients and running and developing your business.

So this event is really important and I'd like to thank LexisNexis for kindly sponsoring, and to the Black Solicitors Network for inviting us to come on board and bringing it all together.

Today you'll have the chance to meet my colleagues from across the SRA - we have Richard Collins who leads our work on risk, performance and inclusion and you'll be able to put your questions to him at the expert panel.

We're also joined by Suki Gill, Sue Heads, Hannah Alexander, Ian Brook and Charlotte Underwood from our supervision team, Sean Hankin from the investigation team, Paul Milton from our legal and enforcement team and Mehrunnisa Lalani who heads up our inclusion directorate.

This is a great opportunity to raise any issues or questions that you have with us and to tell us what you think - and I'd strongly encourage you to do so.

We're all here for the last but most important session of the day - the evening reception - so I hope you're able to stay to continue the conversations with us that will come up during the course of today in that informal setting.

ICCR report

I also hope that by the end of today you'll leave feeling more confident that things are changing at the SRA - that we've made a good start at building Professor John's findings into our programme of significant regulatory reform.

For some time now we've been concerned that BME solicitors have been represented disproportionately in our regulatory decisions and outcomes.

We know we haven't always got things right.

To address this, we've undertaken 3 Independent Reviews to look at these issues.

These were undertaken by Lord Ouseley in 2008, Pearn Kandola in 2010 and Professor John in his Independent Comparative Case Review most recently this year.

Whilst none of these reviews found any evidence of discrimination, they did all point to disproportionality in the outcomes of our regulation and Professor John's report has been crucial for us in better understanding the key question – why? – and how we go about putting things right.

Regulating small firms

His report recognised that the issue of disproportionality is complex and needed a wider debate on E&D issues than had previously taken place.

He pointed to a number of factors which affect BME solicitors that need to be taken into consideration, particularly over-representation of BME solicitors as sole practitioners or working in small firms, a sector of the profession disproportionately subject to regulatory action.

This has made us recognise that there's a immense challenge in the way that we regulate small firms, and we have needed to think about some big question. Questions like:

  • Is a one size fits all the best approach?
  • Are our requirements too complex and time-consuming, particularly for firms with more limited resources?
  • Are we always proportionate? Is the burden of regulation too great?
  • Are our data requests too onerous for small firms?
  • Why do bigger firms feel more able to contact us than smaller ones?
  • are we able to demonstrate openly and transparently that our decisions are fair and non biased?

Earlier this year the Board took some time out to consider these questions and to look at where we've been, what we have achieved, where we're going, what challenges lie ahead and what our priorities should be.

Professor John's report played a large part in these discussions and this culminated in a major policy statement which we published in May, setting out our future reform programme.

The statement outlines our clear determination to remove unnecessary regulatory barriers to competition and growth, reduce unnecessary burdens and costs on regulated firms, and ensure regulation is properly targeted and proportionate for all solicitors and regulated businesses - particularly small businesses who are more likely to fall foul of our regulatory obligation simply because they do not enjoy the resources of the larger ones.

So we need to do more to help small firms, rather than swamp them with detailed rules and onerous requirements. As a starting point, we are looking at three key areas. Firstly, a review of the COLP and COFA arrangements for this sector, looking at whether these are really needed for such businesses, or whether it's overkill. Secondly, appointing a small business appeals champion to encourage transparency and give small firms a much needed voice. And you may well have heard that we are also questioning whether accountants' reports play a useful role in compliance, so we've decided that unless a report is qualified, we don't need to see it.

Later in the Autumn we will be publishing a further package of ideas aimed at supporting small firms, including for example, a dedicated helpline to provide immediate and relevant advice and guidance.

Approach to regulation

Another important aspect of Professor John's report looked at how OFR is applied, suggesting that it may not in itself reduce disproportionality.

We now recognise that a one size fits all model of regulation cannot be applied to a complex sector where one size fits few.

Providers of legal services are very different. Of course the big City firms and small high street practices are chalk and cheese.

But despite this, the current Handbook operates largely on the basis that you're all the same. Yes its true that the slimmed down Code of Conduct can be applied more proportionately, but the rest of the Handbook, some 600 pages or thereabouts, is essentially a series of strict rules and regulations that apply to everyone regardless of the way they do business.

We know that sole practitioners and small firms have finite resources, and in most instances serve a vulnerable population. It is therefore hugely important that we enable small firms to put their clients interests at the forefront and remove any unnecessary regulatory burdens where that won't compromise the public interest and the protection of consumers.

So we're looking at how OFR can be applied in a more proportionate way to different sections of the profession.

But the key for us is that you tell us what we do that doesn't work, and help us to get our regulation to a state where we can all agree it is proportionate and relevant. Today is great opportunity for you to do so and we'd be very keen to hear from you about this.

Embedding ED&I into our core business

Professor John's report also suggested that equality and diversity is not fully embedded into our core business but has been a somewhat parallel agenda.

Significant progress has been made to make sure this is embedded into leadership and staff at all levels. We are working hard to embed cultural change and ensure ED&I is a core value in all we do. The actions set out in our ED&I plan are being embedded in every divisions' business plan and we expect our leadership team and all our staff to demonstrate E&D competencies throughout their work and at their annual performance review.

Most importantly, we are considering fully the findings of the ICCR in our core work to improve the consistency, justifiability and transparency of our regulatory decisions. In 2015 we will be implementing new IT systems, processes and decision making frameworks and criteria as well as significantly enhanced quality assurance arrangements. The objective for this work is to ensure our decisions proportionate and fair, and demonstrably so.

We're also taking steps to attract a more diverse range of candidates when vacancies arise on the SRA Board, Committees and on the Adjudication panel. We are currently recruiting for board members and members of my Equality, Diversity and Inclusion Committee and I'd encourage you to think about whether you or any of your peers would be interested in applying.

Diversity data benchmarking tool

The profession responded incredibly well to our request earlier this year for data on the diversity of their firms.

We recognise the impact of requesting information and we try hard to ensure that we only ask for information when it's important. However, many have questioned our purpose in requesting this information.

We consider it to be critical that all firms take their responsibility in this area seriously. Many do, but some don't. Our view is that requesting firms to gather and collate this data has an important impact in its own right. However, firms need to go further than simply sending it to the SRA. We want firms to consider it themselves and ask important questions about their policies and procedures.

Are all firms really taking all the steps they can to be more diverse and inclusive and deliver equality of opportunity to all employees? To help firms with this process we are collating all of the information provided and will be publishing an online tool in November in this year. Firms will be able to go online and find data (which is anonymised) on similar sized and located firms. We believe this will help those firms who could do more to have the confidence to take further steps. We will also be publishing ideas about some of the steps they might want to consider.

We need to recognise that lack of opportunity and progression in the market, for example for BAME solicitors and women, remains a significant issue and we will work with the profession to progress this.

Engagement with your regulator

So there is still more to do but I and the Board are confident that good progress is being made.

But if we are to succeed, we need to achieve two things from those we regulate – confidence and trust. Both hard to gain, and easy to lose.

Confidence that we will regulate in a way that is fair, inclusive and proportionate. And trust that we can be approached without fear that we'll come down on firms with the full might of our regulatory force.

The only way we will achieve your confidence and trust is by changing our relationship with you.

We've have done much over the past four years to improve our working relationship with the larger commercial firms, but I don't think we can say we've made the same progress with BME solicitors working in smaller firms.

The session on engagement led by my colleagues in supervision will explain more about how we're going about this. But to all intents and purposes it's about us responding more positively when you address issues with us. Let me be clear this is not a light-touch approach, but an approach that enables us to deal with the majority of issues in a more constructive and supportive way than formal regulatory action.


So to sum up, I don't think that we have done as much as we would have liked in the past, but I am confident that we are now making better progress - and the key to that is working more closely with the profession and the firms we regulate.

In the days and months ahead, as the senior team and those across the SRA continue to address these priorities, we will continue to meet as many of you as we can.

I believe that by being more proactive in addressing your concerns, listening, reducing unnecessary burdens and engaging more constructively with you we will make significant headway in achieving the goals set out in Professor John's report.

So please do use today to talk to us - tell us what you think, what works and what doesn't, and where we can do more to support you.

And on that note I'd now like to invite you to join the workshops and I look forward to speaking to many of you later.

Thank you.