13 December 2018

Our risk-based approach

On this page and within the Resources box on the right hand side, you can find information about our risk-based approach to regulating barristers, their professional practice and specialised legal services businesses.

The information on this webpage and within the Resources box on the right hand side is designed to be read in conjunction with our Strategic Plan for 2016-19.

There is some high-level information about this approach on this webpage. If you want to read more about how we manage and control our regulatory risks please read our Risk Framework, our Risk Index and our 2016 Risk Outlook.

 

What is a risk-based approach to regulation?

 

Risk-based regulation means that we are constantly monitoring the market for barristers' and advocacy services. We identify all of the potential risks that could prevent the Regulatory Objectives from being met.  As we do this, we focus our attention as the regulator on the risks that we think pose the biggest threats to the public interest.

We then take action to try and prevent those risks from occurring in the first place, or to reduce their impact. 

 

Why do we use a risk-based approach to regulation?

 

There are a number of reasons why we use a risk-based approach to regulation.

First, and most importantly, the Legal Services Act requires us to regulate in a way that is transparent, accountable, proportionate, consistent and targeted. We do not think we can do that unless we properly understand all of the risks we are dealing with. 

The Legal Services Act also requires us to apply best regulatory practice. We think taking a risk-based approach to regulation is best practice: so we use it. Our oversight regulator, the Legal Services Board, also thinks it is best practice. Indeed, they have required all legal services regulators to regulate in this way.

There is another statutory reason for applying this approach. We are subject to the Regulators' Code and that Code requires us to act in a transparent, accountable, proportionate, consistent and targeted way.

 

How do we regulate barristers in a risk-based way?

 

Our Regulatory Risk Framework describes how we approach the delivery of our regulatory objectives.

We start by looking to understand the wider environment which impacts our work, those we regulate and the consumers of legal services.

We categorise those things which can go wrong in the delivery of legal services in our Regulatory Risk Index. This is a living document which helps us systematically and consistently to identify and respond to potential issues in the market for barristers services. In particular, this means considering the risks of harming the public interest.

At regular intervals, we publish a Regulatory Risk Outlook. It identifies important trends and developments in the way in which legal services are being delivered and consumed. These trends help us pinpoint the most important risk themes and this, in turn, helps us determine the areas which require most of our regulatory attention.

The themes that we identify, therefore directly impact the activities we need to undertake each year (as set out in our annual Business Plans). They also help us make sure that our Strategic Plan is aligned with the latest insight and developments in the market. We publish a new Strategic Plan every three years. This is why our information about regulatory risk needs to be read alongside the information in our Strategic and Business Plans.

 

What are the main regulatory risks that we have identified?

 

We have identified three main areas in which risks threaten our statutory regulatory objectives. These will be addressed within the three strategic priorities that we will address during 2016-19. These strategic priorities are:

  • The opportunity for those we regulate to improve how they meet consumer needs

What consumers want from the legal services market is changing rapidly. There is evidence that some consumers' needs are not being adequately met. We want to understand this better and improve the capability of the profession we regulate to meet these needs.  

  • Improving diversity, and enhancing equality in practice and culture at the Bar

Those who provide legal services are instrumental in maintaining a fair and democratic society, and using the legal system to hold people to account under the rule of law. The legal system needs to reflect the changing make-up of society, and practice at the Bar needs to be sensitive and responsive to that.

  • Responding to commercial pressures on legal services providers

We want to safeguard consumers against the potential consequences of commercial pressures in individual practices, or the system as a whole, where those consequences are not in the interests of consumers or of justice more broadly.

 

Are the risks that we face as an organisation covered in the Regulatory Risk Index?

 

No: at least not directly.

The risks that we face as an organisation (such as project or financial risks) are different to the regulatory risks contained in our Regulatory Risk Index.

We use dedicated corporate and project risk management techniques to manage these types of risk. This helps us to maintain an efficient and effective delivery of our regulatory role, and to fulfil our other corporate responsibilities.

Having said this, when considering how we will respond to regulatory risks, we do take into account some of the challenges, constraints and opportunities we face as an organisation.

Regulatory risks are focused on the market place for legal services: on the experience of those who use legal services and on the activities of those we regulate. This is the focus of our Regulatory Risk Framework, Index and Outlook.

When considering how we respond to regulatory risks, we will need to take into account the challenges, constraints and opportunities we face as an organisation, whether arising internally or driven by external factors impacting our organisation.

 

Where can you find out more?

 

If you want to read more about how we manage and control our regulatory risks, and about the risks themselves, you should read our Risk Framework, our Risk Index and our 2016 Risk Outlook.

We recommend that you read them in the order stated above.