Dev Stahlkopf

In the past ten years, the number of hours worked by diverse lawyers on Microsoft Corp. matters has increased by more than 20 percent. That's not by coincidence, says Dev Stahlkopf, the Redmond, Washington-based company's corporate vice president and general counsel. It is, at least in part, the result of Microsoft's Law Firm Diversity Program, which began back in 2008.

While diversity isn't the only factor the tech company takes into account when choosing outside counsel—experience and subject matter expertise are important, too—firms' hiring and inclusion of women, people of color and LGBT-identified lawyers is a priority.

“Studies show that diverse teams work more effectively and produce better results, and we think that's the case when we think about outside counsel as well,” Stahlkopf says. “And it's really important for us that our employees and the people who do work on our behalf reflect the full diversity of our global customer base.”

When it comes to Microsoft's strategic partner program, which includes just over a dozen firms, Stahlkopf notes that the company takes diversity numbers into account and works to ensure their numbers are improving.

And Microsoft has provided major incentives. All of the firms can receive bonuses of up to two percent of the firm's legal fees for services performed for Microsoft if they reach specified diversity goals. They include hitting specific numbers of diverse lawyers both working on Microsoft matters and managing the company's relationship with the firm. As of 2015, Microsoft has also looked at the number of diverse attorneys employed at the partner level firm-wide as a factor when determining whether bonuses are given, and what size those bonuses will be.

Stahlkopf says that more than 80 percent of the firms are now earning a bonus annually. And so far, she adds, none of the firms have been cut for lack of effort. “What we have actually found is [that] firms have been eager to jump on board and work on this issue with us,” she says.

This year, the firms in Microsoft's strategic partnership program are Arent Fox; Covington & Burling; Davis Wright Tremaine; Fish & Richardson; Greenberg Traurig; K&L Gates; Latham & Watkins; Merchant & Gould; Orrick, Herrington & Sutcliffe; Paul, Weiss, Rifkind, Wharton & Garrison; Perkins Coie; Sidley Austin; and Simpson Thacher & Bartlett.

Of those firms, Orrick earned recognition from Microsoft as the program's top diversity performer in both 2017 and 2016. “We have recognized them [for] a couple of years,” Stahlkopf says. “I think our relationship with them is very strong and it's been great to see them as a partner in diversity.”

Outside of the 13 partner firms, Microsoft has made efforts to hire outside counsel from women- and minority-owned firms, with a target goal of directing at least 7 percent of legal spend there.

Since 2010, the company has spent more than $100 million total on these types of firms, including Snodgrass Annand, Peregrine Law Group and Ragen Swan. “Those firms tend to be really great value firms as well,” Stahlkopf says, “so it's a win-win from a business perspective across the board.”