The majority of ‘legal service providers’ feel they have leadership and culture in their firm to support innovation – but just a quarter have taken the plunge in the past three years.

Joint research from the Solicitors Regulation Authority and Legal Services Board was published today showing that 25% of providers have introduced a new or improved service since 2012.

The survey of 1,500 organisations, including around 900 law firms, found 80% feel they have the management structure to make innovation possible, with 40% having put in place practical steps to promote new ideas.

Solicitors’ firms were found to be more innovative than barristers’ chambers, particularly through extra use of electronic communication with clients and the use of electronic forms and case management systems.

Other key areas where providers have changed have been in working on fixed fees, new practice areas and greater use of technology.

Almost three-quarters of providers on social media use the platforms to advertise services and provide legal updates or free information, although the direct provision of legal services through social media was uncommon.

Speaking at a press briefing ahead of the report’s publication yesterday, LSB chief executive Richard Moriarty said the report reflected a mixed view of firms’ willingness to innovate.

‘Very encouragingly innovation is happening out there but there is room for improvement,’ he said. ‘I certainly believe there should be more innovation in the sector to reflect the change in consumer expectation.

‘There is unmet legal need and if we are going to tap into that there has to be new ways of structuring and delivering legal services.’

The report reflected some interesting attitudes to innovation and how it can be achieved.

Solicitor firms appear to be convinced the driver for innovation can be found in-house, with 60% respondents rating the recruitment of non-legal staff as not important.

Almost one-quarter (23.6%) of firms regarded regulation as a barrier to innovation, with 17.4% citing a lack of necessary finance. Fewer than one in 10 solicitor firms reported that attitudes among staff or clients were holding back innovation.

The report concluded that alternative business structures have had a ‘positive’ effect on innovation and are 13-15% more likely to introduce new legal services.

SRA chief executive Paul Philip said alternative business structures had proved more ‘nimble’ in their leadership and ability to make decisions than traditional partnerships.

The regulator has granted around 500 licences of which 19 have been linked to firms on the stock market, and Philip admitted the SRA can improve its handling of those entities.

‘We spend a lot of due diligence asking who owns law firms,’ he said. ‘We have sorted that out.

‘The real issue is can we regulate law firms? We have lots of people who understand the issue. There are other issues we need to develop our skill set in, such as listed [firms]. We are learning as the market learns.’