Consulting firm Calibrate surveyed professionals in four provinces in its first compensation report
Individuals who hold chief-level business development roles at law firms earn a higher base salary when they have a law degree than when they don’t, according to new findings by executive search and consulting firm Calibrate.
The average base salary for a chief-level business development executive at a law firm was $317,000 in May and June of this year. In contrast, the average base salary of those without law degrees was 29 percent lower in the same period — $246,333.
That’s according to findings from a survey of 92 marketing and business development professionals at law firms that Calibrate conducted between May and June. The respondents are located in Alberta, British Columbia, Ontario, and Quebec, and primarily work at small to mid-sized firms with 100 to 750 lawyers.
Released this week, a report on the survey results represents the first time Calibrate has tracked compensation trends across law firm marketing and business development roles. The figures on the average compensation of business development executives with JDs versus those without law degrees are not reflected in Calibrate’s report. However, Calibrate director Ivan Ivanovitch, who shared the figures with Canadian Lawyer, says they are calculated from the same survey and confirmed by the firm’s data team.
“The growth-oriented firms are competing for strategic business development leaders able to bring net new business, not just manage existing client relationships. That’s one of the reasons for the higher compensation for JDs in [business development] roles,” Ivanovitch says.
“A former practicing lawyer understands the nature of the legal work; she can connect with prospective clients and generate net new business to the firm, like a partner would,” Ivanovitch adds. “They would also have the credibility and the gravitas to collaborate with partners on strategic projects. They have a seat at the table.”
Ivanovitch says business development has taken on an increasingly important role at law firms’ marketing arms. He points to Calibrate’s report, in which 25 percent of the total respondents identified business and client development as their primary area of focus.
Twenty percent of respondents reported marketing and business development as their primary focus, while fewer than 10 percent of respondents identified client relationship management and engagement, developing requests for proposals, and marketing as their primary focus.
In Ivanovitch’s experience, the increased emphasis on business development began within the last five years. While law firm marketing has traditionally focused on things like branding and client communications to increase firms’ visibility, he argues that many law firms have been “directly inspired” by the more sophisticated strategies for pursuing clients used by Canada’s “Big Four” accounting firms: Deloitte, EY, KPMG, and PwC.
“Clients are getting much more sophisticated,” Ivanovitch says.
“They’re much more aware of what legal [services] can potentially cost, and they want value for their money,” he says, adding, “You need business development people that are sophisticated so that they can engage the clients and find the winning solution that creates that opportunity for a partnership between the law firm and their client.”
Other findings in Calibrate’s report include higher base compensation for law firm marketing and business development professionals in Ontario and BC, those with more professional experience, and those who have spent more years at their current firm.
The report found that a gender pay gap persisted for professionals in this field, with women earning an average base compensation of $157,084, compared to the average base compensation of $193,850 earned by men.
Calibrate also surveyed respondents on factors that could compel them to leave their current roles. Thirty percent of respondents cited unhappiness with their current compensation as a factor, while another 30 percent identified a lack of career advancement. Twenty-eight percent said they would consider leaving if they had too much work without sufficient support.
These results beg the question, “What can the law firms do to retain their talent?” Ivanovitch says.
“For the lawyers in the law firm, there is a very clear path to professional development... There’s a whole framework and support for their growth with mentoring, coaching, clear milestones, etc. You know exactly what it takes to become a partner,” he says. “This does not exist for [the] marketing or business development function within the firm.
“The firms that want to retain their top talent, they need to create these opportunities for growth and development,” Ivanovitch adds. “They need to have clear pathways for people.”
