The word “culture” in terms of how a law firm is run, shouldn’t be a simple trending buzz word, or used for soft skills in marketing and for recruitment requirements. Law firm culture encompasses how effectively your firm looks after its staff, stakeholders and of course its clients.
When we think about compliance in law firms, it’s easy to get caught up in the details, and offload and delegate all the risk “stuff” to the MLRO or Compliance Officers. There are policies, procedures, and training sessions to control and deliver firmwide, true, but here’s the thing, none of that matters if the culture of your firm doesn’t support those risk management requirements holistically.
Compliance should never be about ticking boxes for the SRA or Lexcel. Compliance is about creating an environment where following the rules should be second nature. Why? It’s simply how things are done and what law firms and consumers of law expect and require.
Culture Drives Compliance
Culture is that invisible force that guides the behaviours of your firmwide solicitors, partners, associates, business support employees and stakeholders. If your culture values compliance, then sticking to the rules becomes effortless.
However, if compliance is seen as a chore or something to “get around”, you’re asking for trouble. The SRA will sniff you out.
Think about it, you can have the best policies in the world, but if your team doesn’t buy into them, they’re worthless.
Why should your law firm culture and risk management matter so much when you are already so busy working flat out on client work? A culture that supports compliance isn’t just nice to have—it’s essential. It reduces risk, protects your reputation, and keeps you on the right side of the regulators. Plus, it creates a workplace where everyone knows where they stand and what’s expected of them.
The cultural challenges of law firm leadership READ HERE
The SRA’s “Professional Obligations Thematic Review” published in December 2024, it reinforced that it expects firms it regulates to adhere to a positive workplace culture where employees felt safe to speak up, especially when there is a risk of:
- mistakes being made
- clients receiving poor outcomes
- serious ethical concerns being raised
The regulator says it is rewarding and promoting positive behaviours of law firms looking at culture and compliance effectively together. It stated that:
SRA’s “Professional Obligations Thematic Review”
The SRA found a broad range of considerations reviewed by firms, including:
- financials (65%)
- contributions to the firm’s culture (50%)
- training (85%)
- career development (40%).
In the review it was interesting to note that some of the firms were confused about compliance and regulations, and to which organisation they should be adhering. As some law firms are regulated and audited by the Financial Conduct Authority (FCA), and some by the Legal Aid Agency, others mistook requirements from these agencies to that of the SRA’s.
It’s worth understanding exactly who a firm (as well as areas within a firm) must adhere to. We explain everything in our training. You can read more about Teal Compliance training HERE.
The SRA’s Upholding Professional Standards Annual Report 2022/23 was published on 20 December 2024 and it reported that when it came to anti-money laundering (AML) out of the 250 firms it checked on this specific subject, 47 of those firms had regulatory action taken against them.
That’s a massive 18.8% of the law firms it reviewed that weren’t compliant.
You can read the SRA’s annual report HERE.
The Bottom Line for Law Firm Culture and Compliance
Your firm’s culture should be intentionally shaped to make compliance a natural part of the day-to-day workings of your firm. It’s not just about having rules; it’s about embedding those rules into the very fabric of your firm and its people. In a digital world where reputations can be damaged in a moment in time, now, more than ever, integrate your compliance into your positive workplace culture. If you’d rather we kick start this for you and track your risk then why not have a look out our carefully curated and crafted software, TEAL TRACKER.
Thanks for reading and as always, any questions, please feel free to get in touch with me or one of my specialist AML colleagues – hello@tealcompliance.com
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