This is a working paper exploring the private law underpinning CCP clearing in the financial markets. It argues that a private law analysis can help to explain the capacity of CCPs as a legal device. It makes particular reference to EU and US regulatory reform in the wake of the crisis, following on from the G20 statements that OTC derivatives should be cleared on CCPs where possible.

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In the wake of the financial crisis considerable momentum has built up behind proposals to extend central counterparty (CCP) clearing in the over-the-counter derivatives markets. However, implementation is proving complex. This paper argues that one cause of this complexity is that the public sector is seeking to incorporate into legislation (and require the wider use of) a privately owned and operated risk management mechanism. As a matter of law, the paper argues that CCP clearing can be understood as a market-generated ‘legal device’; in other words, one designed to support the markets by means of the interaction of various private law techniques. Following this analysis through, the paper highlights the benefits and drawbacks which derive from the legal techniques underlying CCP clearing (standardisation of contracts, asset-backing, netting and so on) and argues that these qualities are inherent to the device. It concludes that the inherent capacity of CCP clearing gives rise to a qualitatively different set of challenges for policymakers to those arising from technical implementation and it explains that both types of problem need to be addressed if the CCP prescription is to be effective.

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A number of high-profile campaigns relating to diversity have focussed on the large law firm sector since the mid-2000s. Reflecting what has been called the ‘diversity approach’ to equality management, they have emphasised voluntary action based on business case reasoning. This paper considers the impact of these campaigns in practice, focusing the dynamics of diversity policy-making within firms. Drawing upon empirical work conducted in large law firms, it explores in particular the perspective of newly appointed diversity staff who have day to day responsibility for diversity policies in the majority of large law firms. It discusses research findings that show while certain policies were being implemented across the large law firm sector, much turned on the position of diversity staff within firms and their ability to conduct in-house negotiations effectively, to compromise and downplay the potential for disruption to the status quo. On the basis of this research I consider the ongoing debates about holding law firms to account with respect to the diversity of their workforce. While the strategy of pressurising firms to disclose ‘diversity data’ seems to gather pace the paper recommends an open discussion about the goals of diversity policy making as a pre-condition of greater accountability.

There has been a long line of official initiatives seeking to address the poor record of the solicitors' profession on diversity. One of the latest, the Law Society's 2009 Diversity Charter and Protocol, attempts to harness client pressure as a way of bringing about change. The objective of the paper is to assess this strategic use of ‘demand‐side diversity pressure’ in the solicitors' profession, contextualizing the strategy and using different perspectives to assess it. The paper first considers the strategy as a development of ‘business case’ arguments for diversity and explores the implications of scholarly objections to this approach. Secondly, the paper uses empirical data from the City law firm sector to explore the nature and practical effects of demand‐side diversity pressures within law firms. I conclude by considering the prospects of the Law Society's scheme having a meaningful effect, factoring in the possible effects of the ongoing global economic crisis.

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