Q&A: Kristóf Ferenczi, firm managing partner, discusses the future of Kinstellar

Can you share your journey in the legal field leading up to your current role as managing partner?

I started my legal career more than two decades ago as a trainee at the then-established Budapest office of Linklaters, and during my early years I was also seconded to the firm’s London office. My early professional years also included time at a CEE-based independent firm and DLA Piper’s Budapest office before returning to Linklaters. In 2008, as a result of Linklaters’ withdrawal from the CEE region, partners from the affected offices laid the foundation for a new firm, leading to the creation of Kinstellar in November 2008. I became a partner in 2009, and head of the firm-wide energy service line. I was appointed managing partner of the Budapest office in 2020 and became Kinstellar’s firm managing partner as of January 2024.

I am a transactional lawyer at the core, but starting off from a corporate M&A background I soon moved to focus on regulated network industries such as telecommunications, railways and then energy, which has become my main focus for more than 18 years by now. I enjoy the complexity of our work in the constantly developing energy markets, which have undergone waves of fundamental changes over the last two decades.

My professional journey has been an exploration of several interconnected areas of law, allowing me to expand my skillset, knowledge, and insights across various business sectors and transactional issues. I believe that this approach has helped me cultivate a versatile approach and comprehensive perspective to address the multifaceted needs of our clients. It underscores the importance of lawyers’ adaptability in an ever-changing legal landscape.

What motivated you to take on the role of managing partner at this firm?

I am motivated by a profound sense of honour and privilege to lead the firm where I have spent most of my career, witnessing its remarkable growth over the years. Serving as firm managing partner is a unique opportunity for me to contribute to its success, leveraging my experience and commitment to contribute to its ongoing development.

Kinstellar has had a remarkable journey, and I am proud to be part of its narrative. We have grown from a firm of nearly 100 people and four offices in 2008 to 11 offices in 12 countries, a team of over 500 people, and with ambitious plans to expand further in our core regions. We have built a recognised and trusted brand with strong teams of lawyers and business service professionals behind it, gained a strong market reputation, and created robust relationships with market-leading international law firms and corporations.

From the outset, we wanted to create a premium law firm focusing on those emerging markets that are outside of the large financial centres, with a strong commitment to grow our firm on a fully integrated basis across Central and Eastern Europe and Central Asia. We have adopted a unique model that enables us to continue investing in our growth and in our people. Rather than a traditional law firm partnership, our structure has been inclusive and has seen many more colleagues becoming part of our success than would have been possible otherwise. The firm is owned and grown by us, with no headquarters but with a clear, one-firm approach whereby everyone is incentivised by our very structure to work closely together, collaborating across our markets, offices, and practice and sector teams throughout the firm.

What are the key changes or improvements you plan to implement in the firm?

Kinstellar has built a substantially more significant and broader international reputation than most would have believed possible 15 years ago.

Our strategy is to continuously strengthen our existing business from its good starting point and not to grow haphazardly, but as strategically, deliberately, and professionally as possible. Our goal is to be laser-focused on ensuring that we bring the firm to its full potential across our markets, offices, sectors, service lines and teams.

With those objectives in mind, in the next period we are going to put more emphasis on our sector focus and sector teams, as well as building further out our service offerings. With additional growth projects in the making, maintaining our one-firm approach and implementing our integration model in all of our markets, including future new jurisdictions where the firm will expand to, requires concentrated management efforts on internal cohesion, enhancing our internal secondment scheme, as well as further investments in our IT environment.

Our team is at the forefront of everything we do, and we believe in its strength, talent and potential. We aim to create a community, a benchmark for a ‘good place to work’ and to continue making Kinstellar an inspiring environment for our teams.

Additionally, we will continue investing in technology to facilitate seamless collaboration across jurisdictions and optimise our client service, as well as in training and development opportunities for our teams.

How do you plan to navigate the challenges that the legal industry is currently facing?

The legal industry in the CEE/SEE region is grappling with evolving regulatory frameworks and increasing demand for specialised expertise. Generational changes, constantly evolving expectations both from our team and our clients, finding and motivating talents across diverse markets, technology advancements and generative AI – these are just some of the issues that we are grappling with.

Given Kinstellar’s broad footprint covering 11 jurisdictions, as well as our size and continued ambition for growth, we need to offer our teams the opportunity to advance in a coherent and transparent manner. Hence our plans to invest further in our ongoing training programme to make it even more comprehensive, also with a view to help our teams stay abreast of legal and technological developments. Investing in understanding our clients’ business drivers and the sector specifics in which they operate is key to act as their trusted advisers, which is why Kinstellar will continue strengthening our sector focus and sector teams across the firm. On the technology side, we constantly evaluate what is the right approach to our IT infrastructure and what investments make the most business sense. Overall, I find that adaptability and regular assessment of the priorities are key in navigating challenges.

What is your approach towards maintaining a balance between tradition and innovation in the practice of law?

In my view, practising law in the 21st century is not a rigid, unchanged, ‘carved into stone’ professional activity. Being successful as legal advisers to our clients today requires not only commercial thinking, business mindedness, creativity and an ability to assess various outcomes as per the client’s priorities, but new ways of interacting with our clients and building our advice into their decision-making processes. Hence innovation is of key importance for what we do. Having said that, legal education in most of the jurisdictions where we operate in Central and Eastern Europe and Central Asia is still based on a more traditional approach to the practice of law. So, in many ways we take this more traditional view of the practice of law as the background from which many of our colleagues come and turn it into a more innovative and more 21st-century commercial practice of law.

Our goal is that our innovation projects should positively impact our service, resources, financials, pricing, and investment models. In particular, such projects focus on our operational efficiency in transactions; the improvement of our processes; the design of legal services, client-centred services and new legal products; data analysis; automation; communication and collaboration with clients; and client and fee-earner education.

How do you plan to promote diversity and inclusion within the firm?

Kinstellar is committed to fostering an inclusive workplace that reflects the varied cultures and perspectives of our jurisdictions. Our initiatives in this area include targeted recruitment efforts and mentorship programmes.

We hold ourselves and all of our people to a high-level of quality, to a culture of collegiality and support. This is manifested in multiple aspects of our operations, which we believe distinguish us from many of our competitors, and which, taken together, set us apart. Our lockstep partner compensation system engenders a collegial and collaborative atmosphere rather than one of an ‘eat-what-you-kill’ approach, and this in turn leads to a strong and successful team culture.

The overwhelming majority of our partners are local lawyers, many of whom have grown through our own ranks. Many of our partners are women, as are several of our firm-wide sector and service line heads and members of the firm leadership team. We want to continue on the path of helping women succeed in their career at Kinstellar and reach top positions in our organisation.

We have established mentorship programmes to provide guidance and support for professionals from various groups within the firm, which we will further strengthen going forward. Our recruitment processes are designed to attract a diverse pool of talent. We actively seek individuals from different backgrounds and experiences. Recognising the importance of work-life balance, we offer part-time arrangements to accommodate the diverse needs of our team members.

We continually evaluate and update our policies to align with the evolving needs and expectations of our team. We are dedicated to fostering an environment where everyone feels valued and empowered.

What are your thoughts on the impact of technology on the legal profession, and how do you plan to incorporate it in your firm?

Technology is fast becoming a game-changer across all sectors, not only in the legal landscape, particularly with the impending adoption of AI.

We are committed to leveraging these developments wisely and diligently to enhance efficiency, accessibility, and overall client service, while being mindful that we are not a global firm with thousands of colleagues across the world. Hence we aim to invest in a smart and efficient way in digital tools and platforms that cater to the specific needs of our clients and improve the work efficiency of our team. These include, eg more advanced legal research tools and legal document automation, which we are experimenting with at present.

As technology evolves, so does the need for robust cyber security measures. Therefore, we prioritise the implementation of cyber security protocols to safeguard our clients’ sensitive information and protect our business against ever-growing cyber security risks.

Could you share your vision for the firm for the next five years?

Kinstellar will prosper through both organic growth in our existing markets, bringing the firm to its true potential, as well as making bold moves into new markets and adding adjacent services to our offerings. We aim to be the go-to firm in Central and Eastern Europe and Central Asia, both for international law firms that do not have a presence in our region, as well as for our clients.

Fostering our one-firm approach and collaborative and collegial culture, we will continue to attract top talent, embrace technological developments, and uphold the values that have defined our success throughout the years while expanding our geographical footprint.

Our focus remains on delivering exceptional client service, fostering a dynamic and inclusive workplace, and leveraging technologies to stay at the forefront of the evolving legal landscape.