A buyers’ market for professional indemnity cannot hide law firms’ exposure to growing risks
For a profession often accused of being overly obsessed with risk when advising clients, it is ironic that law firms are taking on uncharted levels of risk themselves.
Continue reading “Taken to the limit – growing risks for law firms”
With regulatory focus on financial services business unrelenting, effective risk management strategies are vital. We teamed up with Cornerstone Research to assess the challenges
Nine years ago, the financial services world began undergoing seismic changes with the onset of the credit crunch that have left the industry where it is today. The aftermath led to repeated overhauls of regulation, to the extent that none are certain what the endgame might be, particularly with significant new regulation such as Basel IV being widely spoken of.
The standout performer from this year’s second 25 is once again Mishcon de Reya which, along with Macfarlanes, has been the pace setter in this peer group over the last five years. The firm has come a long way since it first made its debut into the top 50 four years ago in 2012. Over five years, revenue has climbed more than 100% from £65m.
Mishcon revealed robust profits for the 2015/16 financial year, with profit per equity partner (PEP) up 11% to £1m as global revenue grew to £132.7m from £116.7m, an increase of 14%. The firm did, however, this year downsize its Manhattan practice to focus on IP. As such, New York revenue came in at £4.8m, a considerable drop given the business in recent years generated upwards of £13m.
‘We want to be a top 50 law firm. We have the trappings, but we’re not quite there yet.’ So said TLT managing partner David Pester to Legal Business three years ago. This year that ambition has been realised, with the Bristol-based law firm entering the top 50 for the first time.
TLT continued its strong growth trajectory in 2015/16, posting a 15% increase in turnover to £71.6m while profit per equity partner (PEP) was up 10% to £253,000. Overall, the firm has grown in turnover 65% from £43.3m over the last five years, particularly impressive considering the firm’s place in the squeezed national mid-market.
National player Bond Dickinson had a disappointing year financially, with turnover down 3% to £104m, while profit per equity partner (PEP) has also dropped 3% to £275,000, a stark contrast to the firm’s performance in last year’s Legal Business 100, where PEP soared 26% to £284,000 and turnover climbed 8% to £107m. Blaming the results on a harder mid-market and significant IT investment, managing partner Jonathan Blair says that despite the tougher conditions, real estate, private client and transport all performed particularly well.
‘Real estate was strong for us – on the operational property side, on the investor side, on the house building side,’ he says. ‘Private wealth has always been an area for us that has been very reliable. It seems to be able to withstand the vagaries you get in litigation, which tends to be counter cyclical, or M&A activity or any transactional activity. Private wealth is always pretty strong – we have grown that and worked hard on it.’
Since merging with King & Wood Mallesons, legacy SJ Berwin has lurched from one disaster to the next. Can the firm recover?
A dire 2015 brought matters to a head at the firm now known as King & Wood Mallesons (KWM). On a wet and windy evening on 22 March, 24 partners from legacy SJ Berwin were hauled in front of global managing partner Stuart Fuller and European and Middle East senior partner Stephen Kon to be told that they were to depart.
Continue reading “Global 100: Branded – Inside the troubled takeover of SJ Berwin”
While 2015’s Global 100 showed signs of regained momentum, the intervening year saw some contenders come to a shuddering halt. Legal Business looks at the few setting the pace and those faltering in the global race.
In the early hours of 24 June, the unthinkable happened. The UK had voted to leave the European Union by the narrowest of margins, sending stocks plummeting when the London Stock Exchange began trading. Sterling fell to its lowest level against the dollar since 1985. And while the panic had dissipated after several chaotic days, around the world shockwaves were being keenly felt.
‘The UK has embraced technology and alternative legal services faster than the US with some innovative and imaginative thinking.’
Kim Koopersmith, Akin Gump Strauss Hauer & Feld
From downturn fears to investing for the future, law firm leaders give their perspective on the challenges facing elite global firms.
Big issue
‘How the global market evolves is the million-dollar question because we have got some key things lurking in the background and also in the foreground at the minute which would change things dramatically. There is very little organic growth, so you have this continuous battle for both clients and a share of the purse with clients.’
Bryan Hughes, chief executive, Eversheds
