Multinational will cut total billed amount in every matter that fails test by 15%
A pharmaceutical giant has said that it will reduce the total billed amount by its new panel firms in matters that do not meet newly launched diversity and inclusion targets.
Novartis said that it will not pay 15% of total billing in every matter that has less than 30% of billable associate time and 20% of billable partner time provided by females, racially or ethnically diverse professionals, or members of the LGBTQ+ community.
“We recognize that corporate legal departments have an incredibly important role to play in ensuring that the legal profession accelerates its efforts to make meaningful progress when it comes to diversity and inclusion,” said Shannon Thyme Klinger, group general counsel of Novartis.
This is the third iteration of the company’s “Preferred Firm Program” and is launched in support of the company’s pledge to achieve pay equity and transparency by 2023. Novartis is also a supporter of the “United Nations Human Rights Global LGBTI Business Standards.”
Novartis said that it will also increasingly use technology and data analytics to simplify its selection and engagement with its panel firms. That includes new fee models to replace time-based billing, with pay tied to the value the in-house team jointly creates with law firms.
Novartis has also announced new list of preferred law firms. They are:
