Diversity Part II Partnering The DuPont Way: The Diversity Factor - Part I

Monday, March 1, 2004 - 01:00

The Editor interviews Thomas L. Sager, Vice President and Assistant General Counsel, DuPont Legal

Part II of this article appears in the April 2004 issue of The Metropolitan Corporate Counsel. Editor: Why are you, a fiftyish white male, so interested in diversity?

Sager:
It was a combination of events and personal experiences. I grew up in a family from the traditional South. I found that my personal beliefs and perspectives were dramatically altered as I progressed through the educational system and then from being with DuPont, which for the past 20 plus years has been a pioneer in emphasizing the importance of diversity. All these experiences brought home to me the importance of valuing people on their merit, appreciating their differences, and realizing the power of diverse thinking.

Editor: What has been your role in encouraging diversity within DuPont Legal?

Sager:
As a member of the DuPont management team, I am expected to lead; and, because diversity is so important to DuPont's success, I have focused particular attention on this area. Stacey Mobley, our general counsel, and the entire DuPont Legal leadership team is committed to diversity. We are tasked with hiring talented minorities and women, developing meaningful career paths for them, and providing them with opportunities to demonstrate their skills and leadership capabilities. That's just a part of our challenge and role as managers and leaders of DuPont Legal.

At about the time that DuPont Legal began its convergence program in 1992, I realized that the racial and ethnic complexion of our customers, suppliers, shareholders, and employees was changing in the U.S. and throughout the globe as we entered new markets. It became clear to me that the lawyers representing DuPont, both in DuPont Legal and our outside law firms, had to reflect these changes if they were to serve as effective ambassadors and extensions of this company. The business case for diversity, particularly in the legal arena, is really a no-brainer. We must be able to interface effectively with judges, juries and politicians who are becoming increasingly diverse. It was obvious we needed to be more aggressive in holding ourselves and our law firms accountable for acquiring and retaining a more diverse work force.

Editor: How does DuPont Legal view the process of "convergence" as opposed to "strategic partnering"?

Sager:
We did not originate this idea. We borrowed it from our engineering department, which had already gone through a convergence process as had our public affairs staff function.

Convergence was adopted by DuPont Legal in the early nineties. It was one of the leaders having started its program in 1992. But we weren't content to simply winnow down the number of our law firms and try to exact big discounts from them. We wanted the process to be a two way street. We wanted the firms to understand that we were as interested in their profitability and success as our own.

We felt that if convergence were to succeed, it had to be a true partnership. If it is one-sided, and you are always taking and not willing to give, then the relationship at some point is going to break down. Then, of course, you are back in the same old vicious circle - moving from firm to firm, with each new firm having to climb, once again, the learning curve, which means testing its willingness to collaborate with the other firms in our network, embracing alternative fee arrangements, investing in technology, and practicing early case assessment as part of a disciplined process for handling litigation. All of these initiatives are predicated upon trust and a true partnering relationship.

Unless there is a true partnership, firms will be fearful of bringing a case to a conclusion because they would not trust us to provide them with a continuing flow of work. What true partnering communicates to the firms is that we are committed to them for the long haul and in return we want to see a lot of creativity and resourcefulness in bringing matters to closure as quickly as possible, which as you know may not always be in the firm's financial interest.

Editor: You must occasionally have turnover in your outside firms. When you are looking for a new firm, what would qualify them for consideration by you? Would that include diversity?

Sager:
Absolutely. Our criteria for evaluating firms haven't changed. We are constantly vetting firms with an eye to adding firms where we have a critical need that either wasn't addressed earlier or where there is a gap in our network with respect to a particular type of expertise. Perhaps to the surprise of some, the firms that were with us in 1992 aren't the same ones today. Many of them are, but we have added some while others have either severed their relationship with DuPont or merged or have in other ways left the scene.

When we look at firms, there are certain core values that we expect from them. One of which is certainly diversity. If you visit a firm and you meet mostly people who look like me, over-50 white males, it speaks volumes about where that firm is in its effort to diversify. We get into a very focused conversation with firms that want to represent us. We ask for numbers showing minority representation among associates, partners, and members of the executive committee. We ask about minority attrition. We question them about recruiting and all the other facets of diversity to see what the level of commitment is within that firm and how successful have they been in trying to diversify. We also ask what they are doing to help fill the pipeline with minority lawyers in the years ahead.

Editor: What are some of the advantages of being in the DuPont Network that help PLFs and legal service providers to market themselves to other corporate clients.

Sager:
The DuPont Network is a group of otherwise competitive law firms, which outside this relationship compete daily for business. What we insist upon their doing when they are working together in the Network is to put their competitive interests aside and collaborate actively as a team. We encourage them to jointly devise strategies and to use alternative fees to drive greater alignment and teamwork.
The PLFs in the Network offer a significant competitive advantage to DuPont and to other companies that may hire them. They have learned to work together as a team in which they put their own interests aside and think about what is in the best interests of the client.

We encourage the PLFs to experiment with new approaches. We constantly remind them that the Network can maintain its competitive edge by serving as a laboratory where individual firms and groups of firms are encouraged to experiment with different approaches, some of which may work and some of which may not. For example, take alternative fees. We constantly encourage PLFs to develop proposals for alternative fees with an eye to what would incentivize them to get even better results as well as give us predictability with respect to billing. Because they look to us as partners, the PLFs know that if they adopt a particular fee arrangement and it is not working for them, we will not hold them to it if they would be unfairly penalized. We encourage the firms to test other innovations as well. We are developing a technology portal that will facilitate even greater collaboration among our firms.

In all of these ways, our PLFs have been equipped to distinguish themselves in the minds of sophisticated clients in a very crowded legal market. Our PLFs offer tangible values to potential clients in a market where every firm lays claim to having lawyers from pedigreed law schools or who have been distinguished public servants. What really counts in the minds of the chief litigation counsel or general counsel are the things that have enabled our PLFs to produce consistently outstanding results for us.

Editor's Note: Our editorial theme has been that corporate counsel is the "corporate conscience" and that companies and law firms that "do good also do well."DuPont Legal and the law firms that represent DuPont are outstanding examples of those principles. Diversity has long been a major theme for both DuPont and its law firms and legal service providers. Diversity is now accepted by most major companies and law firms as a business imperative not only because it is morally and ethically right, but also for very practical reasons related to legal outcomes and success in the marketplace. In Part II of this year's Special Report on Diversity, we again revisit DuPont Legal with a view to demonstrating how the factor of diversity has contributed to DuPont's efforts to partner with its primary law firms (PLFs) and legal service providers by helping them to market their services to other companies. In Part I, Stacey Mobley, DuPont's General Counsel, gave us an overview of DuPont's dedication to diversity. This month, another perspective is offered by Thomas L. Sager, Vice President and Assistant General Counsel, DuPont Legal. This interview is being published in two installments. In this first installment, Mr. Sager provides an overview of the DuPont Network and the role of diversity. In the second installment to be published in our April issue, he provides specifics on the diversity activities and other features of the DuPont Network.