Lord Carter's recently published Review of Legal Aid Procurement produced a considerable response from legal aid practitioners and those involved in the legal aid world. It generated little interest elsewhere in the legal profession, where it is generally presumed that legal aid and commercial practices are worlds apart.

There is, however, one key area where these worlds come together – quality. Lord Carter's report is entitled "A market-based approach to reform". Many commentators have wrongly assumed that the key to this market is pricing. In fact, the key to any market that does not deal in commodities is quality. Unless there are clear benchmarks for quality and transparent means of judging quality, pricing is meaningless.

As a powerful purchaser of legal services (legal aid funding is in the order of £2bn through more than 3,000 law firms), the Government is well positioned to demand guarantees of quality. This is especially important when the services being bought are often for extremely vulnerable clients. But the whole profession should be able to assure everyone – from large City investors down to individual homebuyers – that it puts quality at the top of its commitment to clients.

The major change proposed by the report is to achieve minimum quality standards for all legal aid practitioners through a comprehensive peer review process. It is this process that will drive the restructuring of the legal aid market. It will be welcomed by many legal aid practitioners who currently operate to high standards and retain a sense of vocation and a level of commitment that is not matched elsewhere in the profession.

The process of quality assurance will, in the first instance, be undertaken by the Legal Service Commission but the report recommends that responsibility should eventually (and by not later than 2009) pass to the Law Society.

What has this to do with commercial law firms? The answer lies in the draft strategy document issued for consultation by the Regulation Board earlier this year that set out key objectives for its regulation of the profession. The City of London Law Society responded to the draft and made the point that, whereas past regulation has concentrated on qualifications for entry to the profession and the conduct of individual solicitors, regulation in future will need to consider the approach to quality of law firms rather than individuals. It will be necessary to have a system which looks at the 'proxies for quality' which will include training systems within firms, knowledge management systems, research facilities, mentoring, appraisal processes and other similar matters.

This will be a major move away from current processes that look principally at qualifi-cation standards and complaints handling with regard to individual solicitors. These matters will remain relevant but, in future, the regulatory board will also need to monitor the levels of investment by firms necessary to achieve an infrastructure that underpins quality.

This regulatory shift in focus from sanctions against individuals for past failings to monitoring of the systems used by firms will be a major challenge. The experience gained in the quality assessment of Legal Aid firms will lead the way in determining how this can be achieved. The current peer review system is the starting point for this process, although it will undoubtedly need, as firms grow, to develop into broader processes for assessing 'proxies for quality' as well as monitoring outputs on a regular basis.

The profession has no past experience to draw on and firms will need guidance as to the systems and levels of investment expected of them by the Regulation Board. The board and the profession need to demonstrate to the outside world that this challenge can be met because it will be a key test of the adequacy and viability of the new regulatory structure.

The world of legal aid will provide a valuable opportunity for developing the necessary standards and systems and will therefore lay the foundation for quality assessment for the whole profession. This is one area where legal aid and commercial firms have a common interest.

Guy Beringer is a senior partner at Allen & Overy and was an adviser to the Carter review.