NALP Bulletin, April 2014

Equity partners in multi-tier law firms continue to be disproportionately white men. A new analysis of recent data by NALP shows that in 2013, only 16.5% of equity partners are women and only 5.4% are minority.

The new NALP findings on women equity partners mirror recent findings by the National Association of Women Lawyers (NAWL) that found "the 200 largest U.S. law firms report only 17% of equity partners are women."

NALP first began compiling the demographics of law firm partners in 1993. With the emergence and growth of multi-tier partnerships, however, there has been little data available to describe the representation of women and minorities among the narrower class of equity partners in these multi-tiered firms. Starting in 2011, NALP began asking law firms to report demographic information for equity and non-equity partners through the NALP Directory of Legal Employers. With three years worth of data now available, the findings are many, but as has been the case since 2011, there is a definite skew amongst women lawyers and minority lawyers who are partners toward non-equity status. Partners in general continue to be disproportionately both male and white (almost 74% white and male in 2013), and in multi-tiered firms the skew amongst equity partners appears to be even greater.

Although this equity/non-equity partnership data remains relatively new compared to over two decades of information on the demographics of partners and associates at law firms, information on the demographics of equity partners is now in its third year and provides an increasingly stable data set from which to be able to say something meaningful about the ranks of equity and non-equity partners as to race and gender. (The fact that the NAWL data so closely mirrors the NALP data also provides some measure of confidence in its reliability.) Although many firms with multi-tier partnerships did not provide equity/non-equity partner demographics in 2013, many did, accounting for almost 23,000 partners, or 63% of the partners in the NALP Directory with multi-tier partnerships. Tables 1-3 provide several perspectives on the findings for 2013 with comparative figures for 2011 and 2012.

• Overall, based on those offices that provided information, almost 63.6% of male partners were equity partners as of February 2013, while somewhat less than half, just over 47%, of both women partners and minority partners were equity partners, a differential of about 16 percentage points. See Table 1.

• More dramatically perhaps, among equity partners, 83.5% were men, 16.5% were women, and 5.4% were racial/ethnic minorities. (The minority figures include both men and women, so the three figures add to more than 100 %.) Among non-equity partners, the respective figures were 72.4% men, 27.6% women, and 9.1% racial/ethnic minorities. See Table 2.

• Finally, among all partners, the equity/non-equity split is about 60%/40%. Half of partners were male equity partners; 10% were women equity partners; and just over 3% were minority equity partners (Again, minorities are also included in the counts by gender.) See Table 3.

In the third year of collecting this kind of information, and as firms become more familiar with reporting of this information, year to year comparisons are more meaningful. Nonetheless conclusions must continue to be made with caution, and small changes should not be given undue emphasis or necessarily construed as a trend. Given how closely some firms hold the information about equity and non-equity demographics, we were pleased to receive the information for about 63% of all partners in multi-tier firms listed in the 2013 NALP Directory, compared with about 50% in 2011.

To the extent that trends in the data can be identified after only three years, it does seem to be the case that the distribution of all partners by equity status is moving, albeit in the smallest increments, toward a greater representation by women and minorities. For instance, between 2011 and 2013, the percent of all partners who were male equity partners fell from 61.3% to 60.2%, while the percent of all partners who were women equity partners rose from 9.5% to 9.9%, and the percent of all partners who were minority equity partners rose from 2.9% to 3.2%. See Table 3. Similarly, the percent of equity partners who were men in 2011 was 84.4%, and fell to 83.5% in 2013. During that same two-year period, the percent of equity partners who were women rose from 15.6% to 16.5%, and the percent of equity partners who were minority rose from 4.7% to 5.4%. See Table 2.

It should be noted that this data is being collected at a time during which the balance between equity and non-equity partners at multi-tier firms is itself changing, and the firms that provided data this year reported a smaller overall percentage of equity partners than they did a year ago. Over the three years that NALP has been collecting this data, the percent of all partners in two-tier partnerships who were equity partners fell from 61.3% to 60.2%, and the percent who were non-equity partners rose from 38.7% to 39.8%. So the finding that the percentage of partners who are female or minority equity partners increased a bit while at the same time the percentage of partners who are male equity partners decreased may be a positive sign, particularly if it is sustained in 2014 and beyond.

To determine whether an individual law firm or law office is a multi-tier firm and to determine whether multi-tier demographic data was submitted for a specific firm, you can review the directory information the firm submitted at www.nalpdirectory.com.

Table 1. Percent of Partners Reported as Equity Partners by Gender or Minority Status

Table 2. Distribution of Equity and Non-equity Partners by Gender or Minority Status

Table 3. Distribution of All Partners by Equity Status and Gender or Minority Status

Note: Figures are based on 262 offices/firms that have a tiered partnership and also reported information on equity and non-equity partner counts. A number of firms that otherwise reported information on an office-by-office basis reported their partnership information on a firm-wide basis. Minorities are also counted as men or women, hence percentages add to more than the total.