The Law Society of Ontario (LSO) has launched a call for comments on potential governance reforms. Reform is long overdue. The governance of the LSO is archaic and in no way approximates the structure of a modern, effective board. To its credit, the LSO appears to recognize the problem and is attempting to move towards modernizing its governance.
There are currently 90 members of “Convocation” – the archaic name for what is supposed to be a Board of Directors at the LSO. These 90 consist of 45 elected licensees (40 lawyers and five paralegals), 8 lay benchers appointed by the Ontario government, the Treasurer, the current Attorney General of Ontario and 35 ex officio benchers. The ideal size for a Board of Directors is 7-15 persons.
The LSO’s governance is anomalous and does not represent best practices for a public interest regulator or for boards generally. This is acknowledged in the Governance Practices Review prepared by Carol Hansell for the Law Society and submitted to the Task Force in June 2017 (“Hansell Report”). The Hansell Report’s Executive Summary notes:
LSUC’s board (Convocation) is significantly larger than almost all boards in the comparator group. Although organizations governing the legal profession had larger boards in general than organizations governing other professions, Convocation is large even when compared with other organizations governing the legal profession.
The inclusion on a board of ex officio and honorary directors (as is the case for the LSUC) is unusual.
Three year terms for directors are more common than the four year terms of the elected Benchers.
Staggered boards are very common (meaning that only some of the directors are elected each year). This is in contrast to the LSUC, where all Benchers are elected at the same time (although Benchers appointed by government are not necessarily all appointed at the same time).
The twelve year term limit for elected Benchers is longer than the term limits in any organization in the comparator group.
In short, LSO governance is anomalous in multiple ways. There is no indication that these anomalies have produced better governance for the LSO. The Hansell Report does not directly address the extremely high percentage of benchers that are elected by members of the professions (i.e. the regulated persons): 45/53 (85%). There is no other public interest regulator in Canada identified in the Hansell Report with such a high percentage of elected board members (I exclude associations who represent their members, like the Alberta Teachers Association which both advocates for its members as well as regulates them).
The Law Society of Ontario is a public interest regulator; it is not the representative body of lawyers in Ontario. As a public interest regulator, it is not appropriate for it to be dominated by the persons that it regulates. Professor Alice Woolley at the University of Calgary’s Faculty of Law has argued that electing members of Convocation is problematic for the LSO’s public interest mandate.
The LSO needs to address potential conflict of interest for its governors. As is well-known, lawyers have lost the privilege of self-regulation in other jurisdictions due to conflation of the representative and regulatory functions (eg UK, Australia). Professor Alice Woolley has called Canada arguably “the last bastion of unfettered self-regulation of the legal profession in the common law world”.[i]
Lawyers (or paralegals) who are serving in executive positions on legal organizations (CBA, OBA, Advocates’ Society, Federation of Ontario Law Societies, District Law Societies, Ontario Paralegal Association, Paralegal Society of Canada, etc. should not be eligible to serve on the governing body of the LSO which is responsible for regulating the legal professions “in the public interest”. Either an executive member of such body would be ineligible to run for the governing council of the LSO or they would have to step down from their executive position with a legal organization if they were elected to the governing body of the LSO. Similarly, if a member of the governing council of the LSO is elected or appointed to an executive position with a legal organization, their seat should be immediately declared vacated.
As a legal matter, it is not possible for a person to simultaneously fulfil their fiduciary obligations to one board to act in the best interest of their profession while at the same time fulfill their fiduciary obligation as member of the governing council of the LSO to act in the public interest. This is precisely the sort of conflict that led to the demise of self-regulation in other jurisdictions. The LSO should proactively and prophylactically address this issue.
I would encourage the LSO to “ask the Moneyball question” about governance of the LSO: if we weren’t doing things the way we’ve been doing them (for decades, hundreds of years, etc.), how would we be doing them?” (See Jordan Furlong, “Ask Yourself the Moneyball Question”, Attorney at Work (September 19, 2011).
Based on the Hansell Report and recognized best practices in governance, the answers would be quite clear: the size of the Board would be 7-15 persons, specific competencies would be identified and recruitment and appointment to the Board would be based on those competencies, terms would be staggered and there would be no ex-officio or honorary directors. It is highly unlikely that members of the Board would be elected, but if they were, elected members would certainly be the minority of members of the Board.
[i] Alice Woolley, Understanding Lawyers’ Ethics in Canada (Lexis Nexis, 2011) 4.