Pointing the finger

Ethics is top of mind for legal regulators in the light of lawyers’ involvement in the Post Office scandal, high-profile SLAPPs (strategic lawsuits against public participation) and alleged misuse of non-disclosure agreements (NDAs). A trial of alleged fraud at collapsed firm Axiom Ince has been listed for February 2027.

All of this raises questions about where the responsibility for regulating ethics lies. Are regulators providing sufficient guidance and support, as well as timely enforcement to uphold standards and foster public trust in the profession?

Ethical conduct is not voluntary. It is part of the rules of professional practice for solicitors and barristers. Solicitors have to comply with seven SRA principles which, in addition to upholding the law and public trust in the profession, require them to act with independence, honesty and integrity, and in the best interests of their clients.

The Bar Standards Board rules include a code of conduct, which covers barristers’ behaviour in their professional and non-professional lives.

The Law Society is working on an ethical practice framework for in-house solicitors, which will be followed by a framework for lawyers in private practice next year. Law Society president Richard Atkinson says: ‘At the Law Society we are constantly looking for ways we can better support the profession to adhere to high ethical standards. This is why we started our three-year ethics programme, in order to help the profession navigate the particularly complex and changing landscape in which legal services are provided.’

When it comes to regulatory responsibility for ethics, he observes: ‘No one person or lawyer has overall responsibility for ethics. Ethics are the responsibility of every solicitor and every law firm, as well as every compliance officer for legal practice (COLP), compliance officer for finance and administration (COFA), every in-house lawyer and general counsel.’

LSB consultation

Last month, the Legal Services Board announced a consultation on Upholding Professional Ethical Duties, which is open until 29 May. It acknowledges the importance of ‘a working environment that supports and empowers ethical decision-making’. The consultation also proposes five outcomes on how effective regulation, together with ongoing education and training, can help ensure that lawyers understand and uphold their ethical duties and responsibilities throughout their careers.

While effective regulation is an important driver of professional ethics, the LSB’s latest regulatory performance assessment criticises the SRA and the BSB on their leadership, effective approach to regulation and operational delivery. This is significant because the SRA and the BSB together cover over 90% of regulated legal professionals (the SRA regulates 164,936 practitioners, and the BSB 17,483). While this was the first year in which operational delivery was assessed, the SRA and the BSB were the only two regulators under the LSB’s oversight that scored ‘insufficient’.

The report referred specifically to the SRA’s authorisation, supervision and enforcement processes, stating: ‘This follows our review into the regulatory events leading up to the SRA’s intervention into Axiom Ince, which [included] a failure to put in place proper mechanisms to supervise firms which pose a higher risk to consumers, and a failure to properly protect client funds.’ In relation to the BSB, the report raised ‘serious concerns about the pace of reform and the effectiveness of its board in holding the executive to account for the necessary improvements’.

Criticisms have also been made of the LSB itself. Against this background, how can frontline regulators ensure practitioners resolve ethical dilemmas that they themselves are failing to address?

Call to action

Richard Moorhead, professor of law and professional ethics at the University of Exeter, is a long-time campaigner for improved professional ethics. Moorhead’s analysis of the Post Office scandal led to his appointment to the Horizon Compensation Advisory Board. Last October and November, he delivered the annual Hamlyn lectures. His third was a call for action in respect of lawyer ethics, citing three central problems:

• Excessive aggression in legal work – suggesting things are legal that are likely not legal, including misleading and abusive handling of legal matters;
• Mutually irresponsible management of legal decisions between lawyers and clients – often aided by lawyers; and,
• Abuse of confidentiality and legal professional privilege.

Moorhead mooted a new independent commission focused on ethics, and ‘more capable, better resourced and more respected regulators able to fairly but robustly enforce their rulebook against powerful players’, supported by clearer professional guidance and codes of conduct. These would be complemented by ongoing education, training and competence reviews for all lawyers. But is the answer yet another regulator?

Paul Bennett, a partner at Bennett Briegal who specialises in legal regulation and partnership, thinks there should be fewer rather than more regulators. He recently wrote in the Gazette that the LSB should be abolished, stating that ‘in criticising the SRA, the LSB was covering its tracks and obscuring its own systemic failings’.

Moorhead acknowledges that ‘there is a bit of blame-shifting going on’. He recalls the SRA’s thematic review of professional obligations, published last December, which found that ‘about one in five COLPs didn’t know their professional reporting obligations, which is a central part of their job.

‘That suggested that lawyers didn’t know their own rules, at least in the areas that the SRA looked at in their review. So there are attempts at measuring the problem as well as looking at cases. Obviously the Post Office is a big example, but there are others too, around NDAs and SLAPPs.’

He cites the Solicitors Disciplinary Tribunal finding against Osborne Clarke partner and head of client strategy Ashley Hurst. Hurst’s defence was that he ‘was not knowingly sending what people now term as SLAPPs’ to tax lawyer and commentator Dan Neidle in relation to his public comments about former chancellor Nadhim Zahawi.

However, Moorhead disagrees with Bennett. ‘If we didn’t have the LSB, the regulators would have to be directly accountable to parliament, and that would be a retrograde step, especially as the LSB is starting to do some quite sensible things on ethics.’

Policy considerations

The Westminster Legal Policy Forum keynote seminar ‘Next steps for legal professional ethics’, held on 3 April, included representations from the LSB, the SRA, the BSB and the Law Society.

LSB chief executive Craig Westwood outlined the LSB’s special responsibilities as oversight regulator on ethics, and the rationale for the consultation. Richard Orpin, director, regulation and policy at the LSB, noted that ‘regulation has a clear role to play, but it isn’t a silver bullet’. The answer is for everyone involved to work together ‘to enable a culture in which it’s much easier for legal professionals to act in accordance with their ethical duties and uphold them effectively when challenged’.

Juliet Oliver, general counsel at the SRA, referenced recent enforcement work. She noted the SRA’s thematic reviews into the independence and integrity of in-house lawyers, and its compliance with the SLAPPs warning notice, as well as new rules concerning workplace culture.

Looking ahead, short-term milestones include the outcome of the Post Office Inquiry; the SRA has over 20 live investigations into lawyers involved in the affair. Oliver observes: ‘We are currently considering with our board where changes to the regulatory framework are needed to strengthen ethical practices, particularly in litigation and disclosure.’

Separately, the SRA is working on guidance on generative AI, and leveraging its own data and intelligence to improve transparency and manage risk. ‘We are looking at solutions with a wider lens,’ Oliver adds, ‘to support professionals in balancing their duty and to drive a culture that supports ethical awareness and equips lawyers to identify and navigate risks.’

Ewen Macleod, director of strategy and policy at the BSB, explained that the board is consulting on a new five-year strategy, and invited contributions. While the BSB is reviewing its code of conduct, ‘appearing in court is only one element of what barristers do, so are we sufficiently clear about how different duties interact?’ Like the SRA, the BSB is looking into the ethical use of technology, acknowledging that most barristers are self-employed, which brings challenges relating to training and development, and culture as a driver of behaviours and outcomes.

Lucy Dennett, policy director at the Law Society, encouraged regulatory bodies to work together and also to look beyond the profession, referencing the Law Society’s Legal Needs Survey and the importance of improving public confidence in the legal sector. The Society’s Changing Ethical Landscapes project, and its forthcoming framework for in-house solicitors will ‘give people very practical tools to help them do the right thing’, she observes.

Tom Hayhoe, chair of the Legal Services Consumer Panel, echoed the need to involve consumers. ‘Without confidence in strong ethical principles, consumers are at risk of not understanding the legal system, facing exploitation and injustice and losing confidence in the system altogether.’

While the panel agreed that mandatory training and sharing standards and experiences across disciplines would improve lawyers’ fitness to practise, they did not address how the regulators’ various guidance will drive cultural change, or the risk of creating more confusion around ethical decision-making if the various frameworks are not perfectly aligned.

Chain of accountability

Moorhead points to competence as a cultural driver. While all regulated law firms must have a designated COLP, he observes that the ‘COLP role is patchy or variable and the regulators need to get a grip on that’. And while enforcement drives behaviours, it has to be consistent across multiple institutions, including the courts. ‘The regulators need to devote more resources to the quality of their enforcement teams and possibly the volume of their investigation and enforcement work,’ he says.

The courts have a role to play too. ‘The courts’ tendency is to brush off ethics issues as too difficult…[they] need to take it more seriously and there needs to be a clear chain of accountability around legal projects like litigation, so that it’s clear who takes responsibility for decisions on disclosure, for example, so that it’s not a game of pass the parcel.’

Moorhead suggests that ethics issues run deep. ‘Rather than changing the rules, it’s about strengthening accountability and enforcement,’ he adds, ‘and ensuring that lawyers and their firms or chambers take ethics seriously, rather than just paying lip service to it. It’s quite a big cultural problem.’

Bennett highlights the need for regulators to present a united front on ethics. They could introduce a training requirement for legal services providers – law firms, barristers’ chambers and in-house counsel – similar to that for anti-money laundering. He agrees with Moorhead that there is potential to centralise law firm ethics through the COLP role, so that everyone understands their responsibilities.

Addressing the ethics dilemma

Another misalignment between ethics and moral judgement is the misconception that all ethical failings are deliberate. ‘In practice, it’s more about thinking about it properly than being a bad person,’ observes Moorhead.

The problem is ingrained in law firm and in-house culture, stemming from internal and external pressures on law firm associates and in-house counsel to be client- and business-focused. However, ‘they shouldn’t be solely or mainly client-focused because they also have to pay attention to the rule of law and the administration of justice’, says Moorhead.

At the Westminster forum, strategic adviser and former general counsel Jenifer Swallow highlighted the tension between acting in the client’s best interest and acting in the public interest. She explained that while ‘businesses want the value that in-house lawyers bring – ethics, governance, security and HR – little to no in-house work involves a reserved activity. Companies are increasingly hiring less experienced lawyers and calling them general counsel – partly because they are less likely to push back [when it comes to acting ethically].’ Swallow calls for more support for in-house lawyers, especially when they are conflicted, and ‘more concerted efforts between regulators and more consistency and common ground when we talk about ethics’ (see also Practice Points, p33).

Alluding to Moorhead’s point about most ethical failings being oversights, Swallow explains that in-house lawyers especially are expected to lawyer aggressively. They often have to resist pressure from their corporate bosses to overstep the mark. The same applies to junior associates in law firms who may not feel able to challenge the partner leading a case. The flip side is that there are also lawyers and judges – in the Post Office case, James Hartley of Freeths, who acted for 555 claimant postmasters, and Lord Justice Fraser, who refused a request from the Post Office’s lawyers to recuse himself – who are prepared to go the extra mile to achieve justice.

So how can the profession improve? Bennett underlines the need for continuing professional development. ‘Most of the profession don’t have regular ethics training, so how can we expect lawyers to make good ethical judgements?’ he asks. ‘Even the COLP and COFA courses only include about an hour on ethics and very few lawyers can recall the seven SRA principles without looking them up.’

For in-house lawyers, Swallow believes in normalising early intervention. ‘You have to be able to call something out straight away if it feels wrong,’ she says. ‘If you don’t do it the first time, it seems less bad the second, third and fourth time.’

External advice (from outside the business) is also key. ‘I trialled an initiative when volunteers from a small GC community would jump on calls with each other when we had an issue – essentially we mentored each other and discussed what worked and what didn’t.’ Swallow believes that legal ethics should be part of a firm, chambers or legal department’s ‘governance stack’.

She explains: ‘Historically, the legal governance stack has been AML checks, conflict checks and client money. What we need now is an ethics stack, which is effectively an independence stack. The guidance from the SRA and the Law Society help to point us in the direction of best practice, but we’re not there yet.’

Like others, Swallow is concerned about the disparity between the different regulators and guidance, and reiterates the difficulties lawyers encounter when phoning the SRA’s ethics helpline. ‘It might help to make a list of examples, but [ethics] is a bit like data protection, where we would consider the principle against the fact – each case is different, so there’s never going to be repeatable output.’

Swallow is not convinced about mandatory training. ‘Training on its own isn’t what makes a difference. We need scenario-based practical innovation, ethics-related conversations in team meetings, and we need to make it culturally OK for juniors to call things out.’ Time is also an important constraint. ‘It’s important for in-house lawyers to have a relationship with the board, so that they [learn to] ask questions that produce the firebreak, instead of always having to produce it yourself.’

Framework for trust

Valuing Lawyers was the topic of the lady chief justice’s Sir Henry Brooke Lecture 2025 at the British and Irish Legal Information Institute. Baroness Carr of Walton-on-the-Hill highlighted ethics, standards and effective regulation as critical success factors.

She said: ‘To ensure that the profession continues to be highly valued, to minimise the risk of unethical conduct that calls into question its value, it is of fundamental importance that the right regulatory structures are in place and the right approach to the teaching and maintenance of professional ethics is in place. That is the challenge. It is one that I have no doubt can be met.’

It probably can. But many laypeople remain to be convinced that it will be, or that the profession is up to the job.