Innovation and the Bar association

Financial Time has now for the eighth time released their FT Innovative Lawyer Report and awards.  They can see a greater awareness of innovation and the conclusion is that they can see a structural change in the legal sector.  Law firms cannot longer focus only on their legal expertise but has to realize the need to focus more on developing their business. This means they have to build their business more around their clients and their needs, with a stronger emphasis on knowledge about client’s business and industry.

One example of innovation in Scandinavia is Fondia, who has built their legal business based on a shareholding structure without partners. That way all employees can be shareholders. They are also using technology and new approaches to client service.

One interesting issue in the report is whether the FT Innovative Lawyers Innovative Individual award could be awarded to someone who is not a lawyer. That was nearly the case this year with the chief executive of Derivative Services and managing director for ebusiness at Allen & Overy;  Mr Chamay. He has created an online legal risk management services that is used by more than 160 institution and 6,000 users. It has contributed to Allen & Overy’s reputation as an innovative law firm.

The big innovative shift for the legal sector might be the realization of how the legal business can benefit from the non legal staff. The Bar Association in Sweden do not allow non-lawyers to become partners in law firms. Since these rules do not apply on offices abroad, this means it is still possible for law firm to have a non-lawyer partner as long as that person is partner at the office abroad, in a country where that is allowed.

This means that Swedish rules may prevent the innovative development in law firms which can result in loss of competitiveness for Swedish law firms.  This is a disadvantage that does not apply to companies such as Fondia since their lawyers are not members of the Bar and now also Fondia has been awarded for their innovative corporate strategy. Maybe the Bar Association In Sweden now should consider changing their rules around  and allow non-lawyers to become partners in law firms?