‘All the top people in this country have grey hair,’ notes one Milan playmaker. It is a truth Italians know all too well: those pulling the strings of the country’s politics and economy are often years past the average European age of retirement. And law is no exception.
The country’s top firms still owe their success to a few veteran rainmakers and their decade-old connections. Individuals like Sergio Erede, Michele Carpinelli and Francesco Gianni, all past 65, still define Italy’s legal market more than 20 years since foreign advisers first arrived in scale. The three largest independents – BonelliErede, Chiomenti and Gianni, Origoni, Grippo, Cappelli & Partners – all generate comfortably over €100m (exact figures must be taken with a pinch of salt).
The individualism of Italian lawyers has been as well documented as it is justified. London’s big four entered the market on the back of the privatisation spree of previously state-owned groups in the 90s only to find lockstep partnership models travel very badly to Milan.
The result was a string of troubled local arms. The union between Grimaldi and Clifford Chance soon hit turbulence. Six years after Allen & Overy (A&O) had merged with Brosio, Casati e Associati, by far its most prominent lawyer, Roberto Casati, quit for Cleary Gottlieb Steen & Hamilton in 2004.
With only a handful of large corporations, Italy’s economy is dominated by family-run SMEs whose patrician managers care more about personal relationships than global legal brands. Add ten years of sluggish growth and the lowest fees for a premier western European economy and it is clear why Italy has not had the same attention as France and Germany.
The international pack largely reacted by retrenching or refocusing on cross-border clients. In the last couple of years, Ashurst and Simmons & Simmons have closed Rome branches, while A&O lost its Italy senior partner Massimiliano Danusso to BonelliErede in 2016. Magic Circle firms cut heavily after the banking crisis.
Aside from Chiomenti, top firms still have to prove they can thrive after the retirement of strong-willed founders.
True, Dentons, Fieldfisher and Herbert Smith Freehills (HSF) bucked the trend: the first with two office launches in Milan in 2015 and in Rome the following year, the second through two local mergers in the space of a year, gaining a sizeable presence in five Italian cities, while HSF opened an IP boutique in Milan in January 2018.
‘We have a bottom-up approach,’ says Dentons’ Federico Sutti, recruited from DLA Piper to launch Dentons’ Italian practice. ‘Most global firms consider Italy a secondary market and focus on international clients. Our strategy is different.’
The Legal 500 Italy researcher Costanza Curro notes that ‘Dentons has been receiving excellent feedback from clients and peers.’
On their part, the Magic Circle – Clifford Chance and Linklaters in particular – have established a strong presence in banking and capital markets, where English law and foreign contacts provide the strongest edge for the foreign counsel.
‘It is very unusual for us not to be present at a table related to financial matters,’ asserts Linklaters’ western Europe managing partner Claudia Parzani, one of Italy’s leading securities lawyers. In turn, Freshfields has focused its efforts on a well-regarded disputes practice, while A&O has concentrated primarily on debt capital markets.
Yet big-ticket corporate work remains in the hands of a few elder statesmen. ‘Italian rainmakers decided to remain independent,’ says Chiomenti’s Carlo Croff proudly.
They were helped by top American firms opting to collaborate with local advisers rather than attempt a frontal challenge. Along with Cleary, Latham & Watkins and White & Case are the two notable US exceptions to have made substantive progress. Latham focuses heavily on private equity, finance and capital markets, although Italy managing partner Antonio Coletti insists ‘the teams we work with are Italian and the work is generated by partners in this office’. Five of its 11 local partners cover M&A and private equity.
White & Case is also viewed as making significant inroads in capital markets work under the robust leadership of Michael Immordino, who re-opened the firm’s Milan arm in 2011.
He says: ‘Our strategy has been to work with our clients on a cross-border basis, representing Italian clients who need both Italian and foreign law services and non-Italian clients who need Italian law services. Almost all our work is cross border.’
Yet Croff remains bullish: ‘Until Cravath, Sullivan & Cromwell, Paul Weiss and Kirkland & Ellis open in Italy, there will always be a place for successful independents here, because they will need to work with us when an Italian deal lands on their table.’
Not that the hierarchy has been unchanged over recent years. Legance, which launched amid a split from Gianni in 2007, has established itself as a muscular transactional adviser, while the 80-lawyer Gattai, Minoli, Agostinelli & Partners has made dramatic ground in private equity since its 2012 launch. Chiomenti has put a difficult transitional period behind it to cement itself as a potent M&A and banking adviser, after a period in which it had fallen behind Gianni and BonelliErede. In the background, Milan has progressively established itself as by far Italy’s dominant legal hub, while Rome’s lustre has continued to fade.
Yet the big questions remain much the same as during the 2000s: will the next generation share the same passion for independence as their founding fathers? And how long will lawyers in their 30s and early 40s be prepared to wait for a chance to shine?
Italy’s economy is globalising. Private equity houses and Asian investors look at local excellence in manufacturing with mounting interest. Former prime minister Matteo Renzi also made some much-appreciated efforts to modernise Italy’s economy before resigning in December 2016.
‘The Italian legal market can be profitable if you do top-end work,’ insists Cleary’s Casati. ‘Costs are lower than other major European economies.’
Aside from Chiomenti, top firms still have to prove they can thrive after the retirement of strong-willed founders. BonelliErede has taken substantive steps to modernise governance and expand its practice in Africa and the Middle East, but lawyers still whisper of its enduring reliance on Erede. Cleary, likewise, knows big beasts like Casati and antitrust specialist Mario Siragusa cannot continue forever.
Foreign advisers still dream of securing frustrated M&A playmakers in their prime. Schooled in a more global and faster-moving market, they may be more willing to join an international platform. Relying on personal relationships will get trickier as more managers are based in Beijing or Silicon Valley than Milan. But for now the delicate balance of ego, style and contacts keeps Italy’s legal community humming productively, if not always harmoniously.