Guest post: Is law a franchise or a business? Lessons from Warren Buffett

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I often look for knowledge outside of the legal profession to help me develop strategy for our [Microsoft’] legal business. I recently came across Warren Buffett’s 1992 Berkshire Hathaway shareholder letter, and this passage on franchises vs. businesses caught my attention:

An economic franchise arises from a product or service that: (1) is needed or desired; (2) is thought by its customers to have no close substitute and; (3) is not subject to price regulation. The existence of all three conditions will be demonstrated by a company’s ability to regularly price its product or service aggressively and thereby to earn high rates of return on capital. Moreover, franchises can tolerate mis-management. Inept managers may diminish a franchise’s profitability, but they cannot inflict mortal damage. Continue reading “Guest post: Is law a franchise or a business? Lessons from Warren Buffett”

Comment: Deal view – Cleary Gottlieb seeks to avoid City M&A anonymity in the age of US disruptors

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Comment: Deal view – Cleary Gottlieb seeks to avoid City M&A anonymity in the age of US disruptors

The London contingent of Cleary Gottlieb Steen & Hamilton has recently moved across the road into premises so new they do not yet have a postcode recognised by Google Maps. The irony is not lost if you consider the firm’s role as counsel to Google on some of the most high-profile antitrust cases in recent years. You would have thought they would have had that detail covered.

Uncharted or otherwise, the shiny new office can only be seen as a vote of confidence from Manhattan, especially as it will allow the City branch to accommodate some 180 lawyers – 40 more than it currently houses. But despite an exceptional competition practice and a long-established European network, Cleary ’s struggle to become a big hitter in London for mainstream M&A has been evident. Continue reading “Comment: Deal view – Cleary Gottlieb seeks to avoid City M&A anonymity in the age of US disruptors”

Comment: The golden age of law firm leadership has passed… what now?

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I used to say three things when asked for a view on the quality of leadership in the profession. Firstly, that it was pretty good (certainly better than commonly supposed). Secondly, the standard has generally improved (since the early 2000s). And, thirdly, the notion that law lags far behind most industries in management is nonsense (poor leadership being rife).

It was only when recently asked this by a new reporter – an experienced business correspondent but new to the profession – I realised that I could only now stand by the latter contention. After all, there is still much to be said for the disciplines of the owner-manager structure, even amid New Law disruption (and perhaps more than ever in an age that has revived the fashion for the cash-burn phase). But as someone who has met hundreds of managing and senior partners, my view is that this is a long way from the golden age of law firm leadership. Standards of operational polish have continued to improve – there is a reason that major law firms so rarely fail in the UK. That matters, but it is only part of the equation in an industry facing structural issues. Continue reading “Comment: The golden age of law firm leadership has passed… what now?”

Guest comment: NDAs and the profession’s cultural problem revealed before Parliament

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Guest comment: NDAs and the profession’s cultural problem revealed before Parliament

Evidence before the Women and Equalities Committee last week (28 March) paints a worrying picture of ethics in the legal profession. And by ethics I do not mean some whispy, academic notion of doing the right thing. I mean professional ethics: understanding the Code of Conduct, and the law that governs lawyer behaviour. It was a lesson crystallised at the hearing by that well known purveyor of fey, leftist nostrums, Philip Davies MP. He distilled for the lawyers ranged before him a central question: why is it lawyers are very clear about their obligations to act in their clients best interests but so unclear about their other obligations?

Because though Allen & Overy (A&O) partner Mark Mansell did a decent job of balancing the need to engage with the new-fangled idea that all was not well with non-disclosure agreements (NDAs) without breaching that holy of holies, client confidences, he still dug himself a few holes in front of the assembled MPs. The veteran employment lawyer did so by talking in the abstract about an imagined, 20-year-old agreement that was negotiated over 24-hours-plus, with one 12-hour ‘all-nighter’ session, which prohibited one party from having a copy, which contained clauses designed to inhibit and limit disclosures to the police, medical practitioners, and others. Mansell said such an agreement could be described as unusual, or very unusual, or very, very unusual. But he wasn’t able to tell us, he said, about this agreement. Continue reading “Guest comment: NDAs and the profession’s cultural problem revealed before Parliament”

Deal view: Cleary Gottlieb seeks to avoid City M&A anonymity in the age of US disruptors

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Deal view: Cleary Gottlieb seeks to avoid City M&A anonymity in the age of US disruptors

The London contingent of Cleary Gottlieb Steen & Hamilton has recently moved across the road into premises so new they do not yet have a postcode recognised by Google Maps. The irony is not lost if you consider the firm’s role as counsel to Google on some of the most high-profile antitrust cases in recent years. You would have thought they would have had that detail covered.

Uncharted or otherwise, the shiny new office can only be seen as a vote of confidence from Manhattan, especially as it will allow the City branch to accommodate some 180 lawyers – 40 more than it currently houses. But despite an exceptional competition practice and a long-established European network, Cleary ’s struggle to become a big hitter in London for mainstream M&A has been evident. Continue reading “Deal view: Cleary Gottlieb seeks to avoid City M&A anonymity in the age of US disruptors”

Comment: After shock Voge departure, Latham has a #MeToo problem and so does the profession

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Comment: After shock Voge departure, Latham has a #MeToo problem and so does the profession

Latham & Watkins and William H Voge are fortunate in one regard. The looking-glass glaze that appears when law firms are embroiled in newspaper-selling scandal typically inflates status to make a so-so story look better. ‘Top lawyer involved in….’ stories usually translates as ‘someone you’ve never heard of at a mid-tier firm you rarely think about’.

In this case, Latham benefits that the significance of the departure of Voge is so strong in the industry that general coverage will inevitably underplay it. With respect to the Magic Circle, for years now Latham has been firmly established as the world’s most influential and potent global law firm. That status was underlined earlier this year when the world’s highest-billing legal practice became the first to cross the $3bn mark, a distinction that only a few years back a London-bred law firm looked certain to achieve. Continue reading “Comment: After shock Voge departure, Latham has a #MeToo problem and so does the profession”

Comment: A shock to the system as Freshfields heavyweight departs

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Comment: A shock to the system as Freshfields heavyweight departs

Given that it has been so well telegraphed that the $10m lateral was coming to the Square Mile, the shock among City peers at the hire of Freshfields Bruckhaus Deringer private equity veteran David Higgins (pictured) has been, well, shocking. ‘Outrageous’, ‘obscene’ and ‘mildly appalling’ are among the reactions from peers. One hopeful partner at a US firm notes: ‘The clients won’t be impressed with that number splashed all over the news.’

But such sentiments are a naive reading of how the industry is evolving. Yes, if you think of a lateral as wrangling an immediate book of business, such a package suggests needing to preside over $30m within three years to be called a success on a conventional yardstick. That would certainly be a stretch – though not impossible given what some of the strongest City laterals have managed – but that is not the benchmark. Kirkland & Ellis has been stuffed with leveraged finance talent for years while lacking an unquestioned corporate A-lister. The hyper-productive Matthew Elliott delivered that when he joined from Linklaters in 2016, but his practice has a very precise real estate slant. Continue reading “Comment: A shock to the system as Freshfields heavyweight departs”

Comment: Law firms will never just hand status to City women – they’ll have to take it

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Comment: Law firms will never just hand status to City women – they’ll have to take it

In a blow for traditionalists, our latest cover feature eschews profiling a group of hard-working, smart, highly-confident men who are talented lawyers to instead profile a group of hard-working, smart, variably-confident women who are talented lawyers. Radical stuff.

But then the career cycle for too many ambitious female deal lawyers remains nasty, brutish and short. While women increasingly advance into senior roles in advisory practice areas and even more so among the ranks of senior general counsel, in the upper reaches of transactional law, it is still a boys’ club and anyone claiming differently does not know many corporate lawyers. Continue reading “Comment: Law firms will never just hand status to City women – they’ll have to take it”

Guest post: The Legal 500 United Kingdom is changing – and it starts with the submissions

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Guest post: The Legal 500 United Kingdom is changing – and it starts with the submissions

Those of you in the UK with fond memories of the hefty The Legal 500 books dropping onto your desks are in for a change. The publication later this year of the latest research will be environmentally-friendly and move to a wholly digital platform via legal500.com. Our ambition is to create the best possible exposure for law firms’ practices via our online rankings. We want to ensure the most relevant information on law firms and sets is readily available to clients, creating the most comprehensive and user-friendly research service available anywhere online.

Moving The Legal 500 to a digital platform gives legal500.com the flexibility to offer that expanded service. As we seek to improve and expand our published information on the market, we want to work in partnership with law firms and sets, so that our evolving research reflects what you need to convey to clients seeking your firm’s help. Continue reading “Guest post: The Legal 500 United Kingdom is changing – and it starts with the submissions”

Guest post: What happens to Anna when companies merge?

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Guest post: What happens to Anna when companies merge?

This is not a piece written from the perspective of a project manager or a strategist. Neither am I writing a worthy best practice guide. What I would like to do is to take you into a small world occupied by one person. She is an in-house lawyer. Let’s call her Anna.

Anna has worked for the Medium-Sized-But-Mighty-Fine (MSBMF) pharmaceutical business for the last five years. It was only very small when she started, but MSBMF has grown quickly after two of its products became market-leading. Continue reading “Guest post: What happens to Anna when companies merge?”