Following Sir David Clementi's review, Edward Nally calls on the profession to embrace this opportunity for change


Every new year brings new challenges and opportunities. This year, Sir David Clementi's report is shaping up to dominate the professional agenda. The report maps out opportunities for the legal profession, and indeed the Law Society, that we would be foolish to ignore.


It is common ground in all democratic legal jurisdictions that the key features of lawyers are independence from government and any other interests, the avoidance of conflict of interest, and an obligation to put clients' interests first. But these critical core values rarely invade the consciousness of the average citizen until something goes wrong. It is also undoubtedly true that respect for professionalism in its traditional sense has all but disappeared. There is a greater tendency by the public to challenge existing custom and practice, and to seek modernisation where appropriate. But isn't that entirely correct?


Many see an increased emphasis on consumerism and competition as inherently in conflict with the role of the lawyer. I absolutely reject that proposition. We could turn our face against these changes but how would that further the reputation of lawyers in an ever more competitive marketplace where little is taken for granted? It is better to work with the inexorable development of society, while ensuring that core professional values are preserved and only pursuing consumerism and competition where it is compatible with maintaining professionalism and the overall public interest.


A key aspect of the Clementi consultation was his analysis of different models for regulation. Many commentators expected Sir David to opt for a government-appointed authority to regulate all legal services directly. The Law Society argued strongly against that, and the profession should be glad that Sir David has concluded that profession-led regulation should continue. The regulation of legal services in a manner that is based on the existing professional bodies subject to a light-touch overall regulator promises to be the right outcome for both the public and the profession.


But this is not a blank cheque for the future. Sir David has made it clear that the Law Society, the Bar Council and others need to review their governance arrangements to make them fit for purpose. We will also have to demonstrate competence to maintain that regulatory role.


So what does that mean? For the Law Society it means the delivery of internal governance reform that the council had the foresight to set in hand through the establishment of the review chaired by Baroness Prashar. The maintenance of a direct regulatory role by a council of more than 100 members is no longer credible. That situation is exacerbated by the inevitable accusation that a council whose members fulfil a dual regulatory and representational role will have the one function tainted by the other. Whether or not that is a reality is irrelevant. The point is that the public, and those who scrutinise and oversee us, see things that way.


The council has recognised the need for greater separation of our regulatory and representational functions. The task is to start now to deliver that vision and to prove we meant what we said. We must not put things onto the difficult pile with some naïve and misplaced assumption that the government will turn its focus away from us.


Sir David Clementi has also made clear recommendations about consumer complaints. I think the transfer of consumer complaints to a body independent of the Law Society will be a good thing. The Law Society - simply because it is also the professional body for solicitors - is not well placed to deliver maximum public confidence in that role. Only a new body, run independently of the Society, will have that opportunity for a fresh start.


And finally, what of Sir David's alternative business structure, legal disciplinary practice (LDP)? He rather adroitly places on the proposed legal services board and the regulators the responsibility of determining how LDPs could be regulated.


Most commentators have no philosophical concern about legal disciplinary practice between fellow regulated professionals. However, the prospect of external ownership causes more anxiety because of the need to ensure equivalent consumer protection for those who obtain legal services from such an entity.


But that does not mean it is impossible or wrong to contemplate that occurring. Greater consumer choice does not mean the death of the profession. Nor will it inexorably lead to the end of private practice as we know it. This is why some firms are looking seriously at the prospect of external capital.


A modern profession will only thrive for the next generation if it shows willingness to face change head on and to adapt to it. We all know that the law we practise today is dramatically different to that which existed when many of us qualified. But this is not a time for self-indulgent reminiscence. We are all stewards of the future and those of us on the Law Society Council are in the special position of having the responsibility to ensure that stewardship accommodates change.


If we do not do so, then not only will our colleagues in the profession rue the day - we will also be letting down consumers of legal services. It is their needs, rather than ours, that must determine the regulation of our profession.


Edward Nally is the Law Society President