Category Archives: Law as a business

Clementi 10 years on (and now for the next 10)

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This month marks the tenth anniversary of the publication of Sir David Clementi’s final report on the regulatory framework for legal services in England & Wales.  How time flies!  The report is still a good read, and a helpful reminder of what needed to change – and why.

The report laid the foundations for the Legal Services Act 2007 (even though the Act went further on alternative business structures than Sir David was willing to recommend).  Its principal aims can be summarised as:

  • creating the Legal Services Board and establishing the principle of regulation that is independent from professional representation
  • improving the way in which – and the speed with which – complaints against legal services providers are handled, including setting up the Office for Legal Complaints and the Legal Ombudsman
  • liberalising the business structures through which lawyers can operate by permitting ownership and investment by individuals who have not qualified as lawyers, and allowing legal businesses access to external capital.

All of these primary objectives have been achieved – more or less.  So what now?

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‘Client’ or ‘customer’: does the label matter?

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Earlier this month, I was invited by the Executive School of Management, Technology and Law at the University of St Gallen in Switzerland to deliver a keynote presentation on the topic of whether ‘client’ or ‘customer’ is a distinction with or without meaning.  Although I had mulled this over many times before, this was the first time that I had really given it any sustained thought.  I was slightly surprised by my conclusion!  I had previously been of the view that it was largely a matter of personal preference (or prejudice), but in the end lawyers sold and – whatever they were called – others bought, and the label didn’t really matter.  I’ve now come to the view that it really does matter. Continue reading →

The future for legal services regulation

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Introduction

Let me begin with a disclaimer. I hold a number of non-executive and advisory appointments with various organisations. What I say here represents my own thoughts and should not be attributed in any way to any of them.

In addressing the fascinating issue of the future for legal services regulation, I confess that I am starting from a possibly contentious proposition: that the current framework is still essentially founded on a Victorian guild and apprenticeship model.

Despite Sir David Clementi’s recommendations ten years ago for a new regulatory approach, unfortunately – though our structure has certainly been reconditioned – it is not as good as new. It is perhaps worth reminding ourselves that his proposals were not as radical as the provisions of the Legal Services Act 2007 itself (in that his views in relation to external ownership and multidisciplinary practice were more conservative than the Act). And so, in a strange twist, the changes in the legal services market heralded by Sir David’s report and enabled by the Act have resulted in a regulatory framework that is not truly fit for the purpose of regulating the liberated market that they have created.

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