Retaining talent and attention: Why goodwill is both an appreciating and depreciating asset

In a profession that thrives on precision, commitment and high-stake trust, law firms today are dealing with a quietly escalating challenge: how to retain not just talent, but attention.

It’s no longer enough to hire the brightest minds and most experienced professionals. The real test now lies in sustaining their energy, engagement and emotional investment for the long haul. The challenge is not only who stays on the payroll, but who stays present - intellectually, emotionally and purposefully.

Across firms, conversations once confined to the cafeteria or chai ki tapri have become open acknowledgements: young lawyers are burning out faster, seniors are quietly disengaging and the once-desired partnership track doesn’t carry the same brand value it once did. Even the most reputed names are not immune. While data on attrition within Indian law firms is sparse, the broader professional services sector, which includes legal services, has witnessed a steady migration of entire teams from leading firms to boutique setups. Clearly, the problem is not isolated. But beyond the numbers, what firms are truly losing is something harder to measure - goodwill.

Goodwill doesn’t appear on a law firm’s balance sheet. Every managing partner, practice head and HR knows when it’s there and, more acutely, when it’s not. It’s felt in the unspoken bond between mentor and mentee, in the trust that underpins late-night collaboration and in the quiet assurance that someone has your back when it matters most.

Goodwill is not a bonus payout or an employee-of-the-month plaque. It’s deeper, quieter and far more lasting. It’s the senior who trusts their associate beyond output, the firm that accommodates life’s unpredictability without judgment. It’s the small, silent currency of mutual respect that sustains the culture of a place long after the policies fade from memory.

And herein lies the paradox: goodwill is one of the few assets in a law firm that both appreciates and depreciates, depending entirely on how it’s treated.

When nurtured, goodwill grows organically. It fosters collaboration instead of competition, mentorship instead of mere management, ownership instead of obligation and initiative instead of inertia. Associates go the extra mile not because they're told to, but because they want to. Seniors invest in juniors because someone once did that for them. Partners evolve from billers into leaders.

The cumulative impact of this invisible culture is immense. It retains people not through policy, but through purpose. One must never forget that employees are either firm’s strongest advocates or sharpest adversaries; what they become is up to you.

Yet, goodwill is alarmingly perishable. And especially in Tier-1 law firms, with their notoriously high-pressure environments, the decay can certainly be swift. When emails go unanswered but expectations don’t, when wins aren’t celebrated but mistakes are magnified, when facetime is mistaken for commitment - that’s when goodwill begins to decay. Not always through visible attrition, but through something subtler and more dangerous: disengagement. The quiet quitting of the legal world.

The pandemic only accelerated this reckoning. Its exposed cracks in traditional firm models and amplified what younger lawyers had long been feeling. They are asking harder, more personal questions:

• Does my work have meaning?

• Am I seen beyond my billables?

• Will I still want this life ten years from now?

The firms that aren’t paying attention to these questions are finding themselves in an endless recruitment loop, hiring fast, losing faster. Those who are, however, are doing something remarkable. They are choosing to re-recruit their own people. Not just during annual appraisals, but every month, every matter, every moment that matters.

The definition of excellence hasn’t changed; it remains sacrosanct. What’s changing is the understanding of what it takes to achieve it sustainably. Loyalty can no longer be assumed; it must be earned. The generational equation has flipped. Where firms once asked candidates, “Why should we hire you?”, today’s associates ask, “Why is your current team leaving?”

As the profession welcomes Gen Z and Gen Alpha - generations that have experienced hybrid work, digital flexibility and values-driven workplaces - law firms can no longer rely on legacy models of hierarchy or rigidity. This generation doesn’t thrive on facetime; it thrives on faith. The culture must evolve to reflect inter-generational values, blending traditional discipline with modern empathy.

Building goodwill doesn’t demand seismic transformation, it demands consistency. It’s in the daily decisions that quietly shape culture:

• A partner who recognises effort beyond closed doors.

• A colleague who shares credit, not just workload.

• A senior who asks how someone is really doing.

• A management team that treats flexibility as a retention tool, not a threat to control.

True goodwill grows through regular feedback that leads to action, transparent pathways to growth, genuine mentorship and recognition that goes beyond compensation. It’s about seeing lawyers as people, not just performers.

Every firm has a choice to treat goodwill either as an appreciating asset or a depreciating asset. The choice will define not just their internal culture, but their future sustainability. Because ultimately, law firms are built on relationships with clients, with courts and with colleagues. Like all relationships, they thrive on trust, shared values and the willingness to invest in one another.

Jogesh Sharma is the Founder and Muskan Aggarwal is a Consultant - Practice Management at Yellow Wire Consulting.

Disclaimer: The opinions expressed in this article are those of the author(s). The opinions presented do not necessarily reflect the views of Bar & Bench.

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