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Events 280509

Final Member Event – Monday 1st December 2008

The final member event for the 2008 Calendar year was held on 1st December after the Annual General Meeting. Dr Christine Parker, Associate Professor and Reader at Melbourne Law School was the keynote presenter. The title of the presentation was “The Powerful Impact of Law Firm Management Systems on Complaints ”

The following report was prepared by Rosemary Gillespie from Proof Communications www.proofcommunications.com.au and is also featured in the most recent newsletter.

Click here for the most recent newsletter.


The Powerful Impact of Law Firm Management Systems on Complaints

When ethics specialist Dr Christine Parker set out to assess if incorporation has an effect on complaints against law firms, she wondered if the doomsayers were right. Does incorporation diminish law firms’ ethics and values? Are incorporated legal practices turning into profit-driven mirror images of their clients? Is a partnership’s shared sense of responsibility lost when it incorporates?

Dr Parker, an Associate Professor and Reader at the Melbourne Law School, researches and teaches lawyers’ ethics, regulatory enforcement and compliance, and corporate social responsibility. With these questions in mind, she presented her research into the impact of law firm management systems on complaints at the final QL/College of Law event of 2008, generously hosted by Baker & McKenzie and sponsored by Documatics and PTB Consulting.

Dr Parker’s view was that if evidence existed to show a decline in the ethics of legal practices following incorporation, it would be found in the number of complaints made to the NSW Legal Services Commission.

To find her answers, Dr Parker needed access to the self-assessment questionnaires, widely known as the Ten Commandments, completed by law firms on incorporation.

The questionnaires were crucial. They cover 10 goals against which a law firm has to self-assess its performance on a rating of 1 to 5, with 1 being non-compliant and 5 being fully-compliant. The questionnaire includes indicative criteria for each goal, as well as suggestions for how the law firm might achieve each goal.

Describing self-assessment as a ‘light touch’, Dr Parker wanted to know if there a correlation between self-assessment and the number of complaints to the Commissioner’s office. Do law firms receive more complaints before or after incorporation, and do how these figures compare to partnerships?

While the NSW Legal Services Commissioner, Steve Mark, had anecdotal evidence that firms find self-assessment helps to improve their management systems, and subsequently reduces complaints, he had no hard evidence.

So, working in collaboration, the Commissioner gave Dr Parker access to the self-assessment questionnaires while the University of Melbourne paid for her analysis.

Dr Parker looked at how many firms have incorporated. Of single practitioner law firms, which comprise the vast majority of legal practices in Australia, 16% have incorporated. Of firms with 3-5 partners, 33% have incorporated. However, only 4% of firms with 21 or more partners have chosen to incorporate. State by state, the figures are as follows:


% of firms that have incorporated

Year incorporation introduced













When Dr Parker came to analyse the numbers of complaints, she found that contrary to the doomsayers’ predictions there was dramatic evidence that incorporated legal practices are drastically reducing their complaints.

Her research showed that prior to self-assessment complaints averaged 0.301 per practitioner per year. But following self-assessment the number of complaints dropped by a massive two-thirds to 0.098 per practitioner per year.

While Dr Parker could find no relationship between the ratings a firm gives itself and the number of complaints it receives, she did discover that rural, suburban and large firms generate less complaints.

Dr Parker concluded that of all the things that impact the rate of complaints, it is incorporation and self-assessment that make a huge difference to the management and practices of a firm, and dramatically reduce the number of complaints.

Why is this, she asked. Dr Parker’s view is that because incorporation is a major disruption to a firm’s practice, many decide to rethink their organisation.

It may be too, she suggested, that self-assessment comes at the right time: it describes the standards that firms need to aim for and how they may achieve these.

It may be, she argued, that before self-assessment firms did not monitor their management practices very carefully.

Dr Parker also felt that the reputation of the NSW Legal Services Commission may be an important factor in reducing the number of complaints. Although self-assessment might be regarded as a light touch, it is backed by a credible and powerful regulatory regime.

This begged the question: should all law firms be required to self-assess?.

The NSW Legal Services Commissioner took the opportunity to expand on a number of Dr Parker’s points.

Firstly, he explained, as Commissioner he has the power to audit firms in New South Wales and to strike off firms that behave unprofessionally. But his preference is to invest his resources in those firms, incorporated or not, that receive a high number of complaints and assists them to implement the Ten Commandments, unless there is a very clear case of professional misconduct.

Secondly, the self-assessment process gives firms the opportunity to persuade the Commissioner that they have appropriate systems to achieve the “Ten Commandments”, even if their systems are unique.

Thirdly, in 2009 firms will be able to complete the self-assessment questionnaire online. They will have access to more information on the self-assessment criteria, including examples, so they can establish their risk profiles more efficiently. This will enable the Commission to identify firms that need help, or even discipline, more quickly.

Lastly, the Commission will not randomly audit firms that have credible certification, such as LAW9000. One of the Commissioner’s goals is to encourage firms to improve their practices in their own way, and LAW9000 enables firms to do this.

Dr Parker and the Commissioner agreed that the research had been very effective in confirming self-assessment as a tool to reduce complaints against law firms which, as Commissioner, he takes very seriously.

The Commissioner was careful to say that while ethical behavior in law firms has not been lost, it needs to be embedded to ensure it is strong and resilient.

Written by Rosemary Gillespie, Proof Communications: www.proofcommunications.com.au


Presentation Details

Dr Parkers Presentation can be viewed here.



The presentation was videoed and can be viewed by clicking on the presentation below.

Part A – Welcome by Patrick Fair – Chairman QL and Partner Bake and McKenzie – Hosts for the event

Part B – Introduction by Steve Mark – Legal Services Commissioner NSW and QL Board Invitee

Part C – Dr Christine Parker’s Presentation – First section

Part D – Dr Christine Parker’s Presentation – Second section

Part E – Dr Christine Parker’s Presentation – Final section

Part F – Closing Comments – Steve Mark.

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