During its 125th anniversary year, Slaughter and May still divides the industry like no other institution. For its admirers, it is the standard bearer, bucking the received wisdom of the modern legal market – for detractors, an outfit on borrowed time, hoping to bet against the market (with an unhedged bet at that).
But 17 years since it first articulated what became irritatingly known as its best friends strategy, there remains no clear answer as to which camp is right.
Still, as we find in our look at the firm’s celebrated corporate practice this month (see ‘The new boy’), Slaughters has had a pretty good crisis. Buoyed initially by bank bailout work, it has coped admirably in an environment in which its domestic corporate market has been in hibernation, while the economic shift eastwards further threatened its relevance.
On paper, Slaughters should be in trouble. In reality, the simplicity of its structure, relatively low cost-base, flexibility of its generalist approach and consistency of its partnership have compensated in the medium term, though not without a little slimming down.
The firm retains by far the strongest corporate bench in the City, while also having picked up market share as City rivals shift focus abroad. It’s striking and slightly unsettling the extent to which the firm still relies on Brand Boardman – there are more succession issues than Slaughters lets on – but even without Mr M&A, it’s a fantastic line-up.
None of which is enough to put Slaughters’ future beyond reasonable doubt. The international question looms as threateningly as it did in the late 1990s. Slaughters’ main counter to global challengers – that they are plagued with quality control issues across their networks – is eroded year on year. Top global firms have their strategic issues, but they are generally making ground in this area and will make more in the future.
How much more scope there is to improve Slaughters’ international showing without a shift in strategy is debatable.
In response, new head of corporate Andy Ryde is putting renewed emphasis on its international profile. What else can the firm do? It has been fortunate that Asia and the US have proved so problematic for key rivals post-Lehman but the law game gets more international by the minute. Slaughters’ sales pitch here would also be more convincing if it wasn’t forced every five years or so to give the same spiel about how its referral arrangements used to be a little rough around the edges but their ‘best friends’ really get it now. How much more scope there is to improve the firm’s international showing without a shift in strategy is debatable. Slaughters cannot match its global rivals for resource.
What will be interesting is if Slaughters were to more robustly articulate another aspect of its approach that makes it as distinct: its classicist view of client service undiluted by CRM programmes or matter profit analysis. There’s certainly scope to play that message up: its international strategy is damage limitation in mitigating the negative inherent in its chosen model. In contrast, its bat-for-your-client ethos could have a major upside in the era of more demanding GCs.
This also brings us to the main reason Slaughters has endured as an institution against the odds: it provides a world-class service to clients and has the most consistent partnership in the City. Forget the grating attempts to shroud itself in mystique, which may still impress the tourists but no one else, Slaughters’ selling point isn’t style, it’s substance. And it will be those qualities that will give it a shot of confounding expectations for years to come.
alex.novarese@legalease.co.uk