‘We have enough of a say’: Squire’s Peter Crossley on retirement, leadership and the US

Victoria Young talks to the long-serving Europe and Middle East managing partner

When Legal Business last profiled Squire Patton Boggs’ UK legacy firm Hammonds in 2005, the cover line was ‘Bad habits’ – profits had slumped, lock-ins had been introduced and outgoing partners were considering legal action. New managing partner Peter Crossley pledged to get his house in order.

Fast forward ten years and a handful of US mergers later, both current and former partners now sing the praises of Squire Patton Boggs’ Europe and Middle East managing partner Crossley.

‘Very decent’, ‘effective’ and ‘gentle but gets it done’ are phrases heard when surveying former partners about the veteran litigator. In his own words, his leadership style is ultimately about ruling through consensus.

‘The old style of command and control from a professional services firm does not work in the environment we are all working in. You can argue about whether it ever worked. Ultimately being a consensus politician is really important.’

Reflecting on the years gone before, Crossley says: ‘If you asked me, “do you prefer the challenges you have on your table in 2016 rather than in the 2000s?”, then obviously the answer is yes. But looking at the firm we’re becoming, it’s an exciting time.’

Hearts and minds

Crossley’s management reign extends back to when he was elected as Hammonds managing partner back in 2004, restructuring the firm and merging with US practice Squire, Sanders & Dempsey in 2011. Crossley steered the ship through that merger and did the job again in 2014 with Washington DC firm Patton Boggs, and earlier this year with California-based Carroll, Burdick & McDonough.

Squire London managing partner Robert Weekes says: ‘Crossley had the vision to look for a US merger before some of the mid-market UK firms did. We were in the Squire relationship pretty early on, while for UK mid-tier law firms, it is too late now.’

Nonetheless, while Crossley is credited with making Hammonds part of something bigger in a way other mid-tier UK firms have failed to do, some partners are privately critical of the firm for losing momentum, failing to achieve organic growth and management being too centred in the US.

Another former partner comments: ‘Crossley delivered the merger well, but should have stepped down one or two terms ago as a unifying candidate is needed. Decisions are being made in the US, not the UK.’

Since the Squire merger, partners have had differing views of its impact, with several complaining it benefited London at the expense of the regional offices, but Crossley glosses over that point as a non-issue.

He adds: ‘I don’t actually believe that in 2016 – and this may be a complacent thing to say – but I don’t think we have partners saying we are controlled by America. We have enough of a say.’

However, those interested in the future of the firm do view carefully what is happening on its global board, which is made up of 12 partners across the globe who are elected and sit for four years. Currently only two come from the EMEA region, Crossley and restructuring partner Susan Kelly.

With about half its UK partnership in London and the rest spread through its original base in Leeds, as well as the Manchester and Birmingham offices, Crossley has a tricky task of keeping all of his UK partnership happy with each other, let alone worrying about being dictated to by the US.

He says: ‘Obviously, in terms of size, London is the biggest and most important in Europe, but we wouldn’t do what we are doing in Leeds and Manchester if we didn’t see them as flagship offices as well.’

The firm moved into a new office in Leeds last month, shifting 200 staff into a 32,000 sq ft space, slightly smaller than the 36,000 sq ft it had before. In 2017 the firm will further downsize regionally to a smaller office in Manchester, shifting from 45,000 sq ft to 27,500 sq ft in the infamous – if you follow law firms – Spinningfields development. Headcount has dropped from 87 to 68 staff since the Squire Sanders merger in 2011.

Arguing that the new Manchester office has room to increase headcount by 30%, Crossley notes: ‘We are taking slightly less space and you can just get more efficiencies in these newer offices.’

‘The old style of command and control from a professional services firm does not work.’
Peter Crossley,
Squire Patton Boggs

But between 2011 and 2015, headcount was down in Birmingham from 30 partners to 25, while in Leeds it was up from 28 partners to 30. In the City, headcount has stayed flat at 58 partners, although since the end of Squire’s 2015 reporting year, it has added five more partners.

Crossley is adamant Squire wants to be seen as more of a City firm and the headcount figures show investment in those areas. In the firm’s last partner promotions round, it made up four partners in London and two in the regions, while the year before it made up only three in the City, but six in the regions.

One sure-fire method of quelling partner unrest is strong financial performance. Compared to ten years ago, their lot has markedly improved. In more recent years, the firm’s financial performance has been steady but not stellar, although the changing structure of the business over the last five years has made year-on-year comparisons largely meaningless. In the global firm’s most recent results, it posted £544m in turnover, up by 12% from £485m in 2014, but taking into account the Patton Boggs merger, which based on the Washington firm’s 2013 turnover, would have added about £180m to the top line.

Given that the legacy UK firm was generating £118m back in 2010, against 2015 UK revenues for Squire Sanders of £104m, it is easy to see why some feel the firm has lost too much of Hammonds’ famed entrepreneurial drive in recent years.

More indicative of the UK partner’s fortunes financially is how profit per equity partner (PEP) has changed during Crossley’s tenure. In 2005, at the firm’s nadir, PEP was just £80,000 and, although it recovered during the boom years, fell below £300,000 in 2009. The figure touched £526,000 in the last financial year, up by 4% from £508,000 in 2013/14.

Crossley comments: ‘Bearing in mind some of the challenges of putting together and creating a global firm, we’ve done fine. From about autumn last year we have developed pretty significant momentum, which has bled through to the start of 2016, and we are confident this year is going to look pretty good.

‘We are just starting to reap the benefits in terms of the significant investment we have made, not just in terms of money but in terms of time spending getting it right.’

The road ahead

Crossley turns 60 in February 2017 and his term ends in December this year, but he insists he has not yet made up his mind on whether he is going to retire.

He says: ‘It is something we will be deciding as a firm moving through the summer and, if that were to happen, it would need to be announced in the next few months.’

Several names emerge when the idea of successors is floated, with Weekes and EMEA corporate chair Jane Haxby names to watch. Weekes has been London managing partner since 2008 and had a stint on the global board, while Haxby has also done her time on the international board and solidified leadership in her role as EMEA chair of the firm’s corporate practice group.

Current global board member Kelly is another name touted for the top job. An outsider runner could be Jonathan Jones, who was Leeds managing partner, although two former partners told Legal Business his influence within the firm has waned in recent years.

Crossley concludes: ‘The chief executive of a very prominent FTSE 100 company once said to me that your main job is to ensure there is proper succession in place. To leave a firm with nobody in place to take over – you don’t do it in any business, let alone one our size. You want to achieve a seamless transition.’

Understandable sentiments given Crossley’s role in stabilising the firm, but the hope of the younger generation of partners must be that Squire can regain some of the edge that once made Hammonds such a potent force in the profession.

victoria.young@legalease.co.uk