In a recent Law Society survey, 78% of 1,000 firms said that the regulatory system places too great a burden on them. This did not hugely surprise me – some solicitors would say that any regulatory burden is excessive – but nevertheless it indicates a problem. Evidently, many solicitors who are doing a good job for their clients and are not in regulatory difficulty are finding the SRA more of a hindrance than a help. The SRA board will do everything possible to lighten the burden on these practitioners, while maintaining the protection of clients.

If such a large proportion of firms thinks something is wrong, mere tinkering with the detail of regulation appears unlikely to produce sufficient results within an acceptable timeframe. We need a radically new approach, and soon.

The SRA has started intensive work on a new approach to the regulation of solicitors and the organisations in which they work. We call it outcomes-focused regulation (OFR). It will concentrate on what firms must achieve for their clients, rather than the enforcement of prescriptive rules that, even if they are slavishly complied with, might not produce results that benefit clients and uphold professional standards.

We hope that it will enable firms to be far more flexible in how they meet their regulatory obligations, and also to feel they can be more open with the SRA.

There will still have to be some explicit rules under OFR, particularly in areas like accounts. We will need to be clear about the circumstances in which firms will be subject to enforcement. But at the same time, OFR will mean concentrating on those requirements that are genuinely needed to protect clients and deliver high standards of service. All existing rules will be put on trial and if found not to serve a necessary function, removed.

Central to the implementation of OFR will be a new Code of Conduct. This will need to strike the right balance between excessive detail that might stifle new forms of practice and innovation, and lack of clarity about regulatory expectations. The new code will focus on the core principles and outcomes that are genuinely needed to protect clients and the public, and to deliver high standards of service. There will be examples of the types of behaviour that would show whether a firm was achieving the desired outcome.

Given that the current code came into force less than three years ago, you might ask why we need a new one so soon. The need is partly driven by the huge changes in the legal landscape, particularly the impending advent of alternative business structures (ABSs), brought about by the Legal Services Act 2007. We propose that the new code should come into force from the date when ABSs are allowed to obtain licences, currently scheduled for the second half of 2011.

We will need to have intensive dialogue and consultation about the new code, both with existing firms and those planning to form ABSs. As far as possible we will have one set of principles and rules for both traditional law firms and ABSs – that will be clear for consumers and fair to solicitors.

We also want to pilot a new approach to the supervision of firms as soon as possible. We will begin piloting new approaches to supervision visits in 2010, with a view to wider implementation of such visits in 2011. The aim is to have a more constructive relationship with firms, managed by SRA staff with specialist knowledge of their areas.

OFR will be a huge step. Firms will have concerns and face a number of challenges. Managers will need to take greater responsibility for creating the right culture in their firms, which will have to determine for themselves the approach to delivering the right outcomes for clients.

We plan to help firms with the transition to OFR by consulting, holding workshops with firms, providing clear guidance and piloting the new approach and discussing with the profession what we have learned. We will work in partnership with the Law Society to achieve this. For a start, I invite you to read and respond to our paper, Achieving the Right Outcomes.

The shift away from concentration on rules and regulations does not mean that the SRA has embraced ‘light-touch’ regulation. Firms will not be allowed to lower their standards. But, by focusing on core principles and outcomes, we are encouraging firms to consider how to tailor their approach to regulation according to their clients’ needs. It should make regulation more effective, less burdensome and much less to do with box-ticking. We want to move away from investigation of rule breaches as an end in itself, to a discussion of whether a firm can show that it is acting in a principled manner and achieving the desired outcomes for clients. Solicitors will be able to take greater responsibility for their professional conduct and quality assurance.

There is much to be done. I don’t imagine for one moment that it will instantly transform solicitors’ attitudes to regulation, but I hope it will demonstrate the SRA’s determination to be constructive, not obstructive.

Charles Plant is chair of the board of the Solicitors Regulation Authority