Microsoft general counsel Brad Smith
Microsoft general counsel Brad Smith

Microsoft announced an update to its Law Firm Diversity Program on Tuesday as it narrows its focus on bringing more minorities into the upper ranks of the law firms it hires.

The program, originally launched in 2008, has given firms the chance to earn a 2 percent bonus on the fees Microsoft pays to them if they hit certain diversity goals. It was all or nothing and focused on the entire legal team.

Now, Microsoft says the program is being reworked to reward law firms who become more diverse at the top of the leadership hierarchy, according to a blog post from Microsoft General Counsel Brad Smith.

The company expects to dole out a total of $15 million in bonuses to the 15 firms it hires over the next 5 years.

Instead of all or nothing, firms can now earn between .5 percent and 2 percent based on how they stack up against certain metrics. For instance, a firm would earn a .5 percent bonus if 35 percent of its partners are diverse, but that jumps to 1 percent if at least one person leading the Microsoft account is also diverse.

This is just the latest move from Microsoft, as it has made diversity one of the pillars of its corporate culture.

Microsoft CEO Satya Nadella found himself in hot water early in his tenure after making controversial comments about women in the technology industry at an event in October 2014.

The company has spent the months since addressing the issue head on.

Microsoft has released its diversity statistics, and it talks about them publicly at major corporate events. The company now even requires unconscious bias training for its employees.

Microsoft diversity statistics. Credit: Microsoft
Microsoft diversity statistics. Credit: Microsoft

In the legal space, Smith wrote in his blog post that Microsoft is making progress. He reported 58 percent of the lawyers on the company’s in-house legal team and 41 percent of the department’s most senior officials are minorities or women.

Within the law firms participating in the Law Firm Diversity Program, Smith reported the percentage of hours worked by diverse lawyers on Microsoft matters has increased from 33.6 percent to 48.2 percent.

But Smith pointed to troubling statistics that show diversity has yet to make its way to the top of the legal industry, including a study that found that just 7 percent of equity partners at U.S. law firms are minorities.

“Our hope is that through our own Law Firm Diversity Program, we can help ensure that we have not only talented, diverse lawyers in the courtroom and at the deal table, but also as the first chair lawyers and lead negotiators,” he wrote. “And we want to ensure that deserving, diverse partners are managing our case work and leading a talented and diverse group of associates.”

Credit: Microsoft
Credit: Microsoft
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