Despite the majority of chambers forecasting changes to the legal landscape over the next year, very few are creating business plans to help them adapt, a report from the bar regulator has revealed.

In a look into ‘high-impact chambers’, the Bar Standards Board reported that the bar also faces problems with cashflow, departing members, cyberattacks and a lack of commitment to diversity.

The BSB interviewed 170 chambers rated by the regulator as ‘high impact’, a label which measures how serious consequences would be for clients if something went wrong within those chambers.

Of those, 65% said that factors such as cuts in public funding, new opportunities, competition and a downwards pressure on fees would force changes on the bar.

But despite this, a considerable number did not feel the need for a business plan, which the BSB said makes them less able to respond flexibly to risks and opportunities.

The regulator also said it was ‘surprising’ that the 35% that did not see any changes were ‘not able to evidence consideration of the environment in which they operate’.

Out of the chambers surveyed, 23 said they had experienced cashflow problems in the last year, though they said they were confident closure was not imminent.

But some chambers said they felt vulnerable to the departure of a significant proportion of their members, particularly where departing members did not settle amounts owed to chambers.

One practice director said this problem would increase ‘as the market becomes more fluid’.

The regulator also said that in many cases aged debt, or the amount owed, in chambers was high, with the payment of referral fees being cited as one of the reasons for this. It gave the example of deals being done with solicitors, without the knowledge of junior tenants, to forgo their fees in the return for promises of more lucrative work.

The report noted that the ‘lean staff structures’ in many chambers leaves them at risk of fraud, with seven of the chambers interviewed (4%) reporting incidents. One chambers said a criminal had targeted a number of chambers and solicitors by gaining employment as a bookkeeper.

The slimmer structure in chambers also leaves them at risk of cyberattacks, the report said. ‘There is a wider concern that, in an increasingly technologically connected world, chambers are seen as a weak link in the “supply chain”,’ it said.

Moving onto diversity, nearly half of the chambers surveyed identified gaps with compliance with equality and diversity rules set out by the board.

‘A challenge remains that chambers have a high number of high-calibre applicants for pupillage, so the incentive to widen the net is limited,’ the BSB said.

The regulator acknowledged that the chambers that had identified gaps had made good progress to improve their level of compliance.

But it said some have some way to go, giving the example of one chambers which said it had decided to market chambers with universities other than Oxbridge – by extending the spread to Russell Group universities.