Catrin Griffiths, editor, The Lawyer
Judging a firm by its promotions
Analysing partner promotions.in the UK is a fascinating way of gauging law firms’ business confidence. Put simply, associates who are promoted to partner get made up for two reasons: they are intellectually and commercially up to it, and each has a proper business case for promotion.
If there is no growth in a particular specialism, then firms are not going to create highly paid partners in those areas. Thanks to the recession, partner promotions have inevitably dipped in the UK over the last few years; rather, global firms have been promoting overseas lawyers in strategically important markets such as China or the Middle East.
But there were plenty of smiles in the UK last month when The Lawyer collated its partner promotion table. On the whole, the trend was up, with only one firm, Bird & Bird, seeing its total number of promotions drop.
Indeed, 20 per cent more associates were made up to partnership in 2011 compared with 2010.
However, it is still tough to make it to the top in the UK. Take Linklaters, which promoted 18 to partnership this year compared with 14 last year – only a third of the new partners are based in the City, while more than half last year were from London.
One of the best performances in terms of female promotions came from Norton Rose. This year seven of the 15 additions to the partnership were female. Only Squire Sanders & Dempsey, which took over national UK firm Hammonds last year, came close to matching that figure, with eight women out of 18 promoted. Bird & Bird made up only two partners this year, but both were women.
US firms grow home teams
Meanwhile, US firms have started to invest in their own talent. It’s taken a while, because the big US firms only started recruiting trainees a decade ago, but that is now starting to bear fruit.
US firms are still hugely active in the partner lateral hire market (Kirkland & Ellis and Latham & Watkins being particularly acquisitive of late), but many US practices are now taking a longer term view towards organic growth – which is good news for the career prospects of trainees at US firms’ London offices.
Shearman & Sterling, one of the most successful US firms in London, has not made a single external partner hire since 2008. McDermott Will & Emery, which has built its City practice largely through external hires since opening in the UK in 1998, recently promoted Rashpaul Bahia to partner, the firm’s first London lawyer to progress from trainee to partner.
Meanwhile, White & Case, another of the big US beasts in London, has consistently promoted more partners than it has hired, with the emphasis on finance promotions – six in 2008, two in 2009, six in 2010 and six this year. Much of this was occasioned by partner-level defections to other firms, which left a gap in the senior ranks, but White & Case associates can at least see a defined career path.
Client factor wins votes
There has been a whole spate of elections for law firm senior partners across the City this year.
While senior partners traditionally wield less internal clout than managing partners, who tend to make the strategic and financial decisions, they occupy an important symbolic role, often as the voice of the partnership and also as an external ambassador and client-relationship guardian.
At the Queen’s law firm Farrer & Co, senior partner James Furber stood down only to be succeeded by not one but two joint senior partners, Jim Edmondson and Richard Parry, in a move that many observers considered to be a fudge.
By contrast, Linklaters’ senior partner election was a classic case where three partners – one UK banking, one UK litigation and one Belgian corporate specialist – fought for their colleagues’ votes.
In the end Robert Elliott, a well-known UK banking lawyer with a particularly close relationship with key client RBS, won the day. It is the first time that a banking lawyer has occupied the post at Linklaters, as in the past it tends to have gone to a representative from the firm’s all-powerful corporate department.
Over at Simmons & Simmons there was a six-way battle, with litigator Colin Passmore eventually triumphing over former managing partner and fellow litigator Mark Dawkins in the partnership election. Passmore is another celebrated client man – this time for Barclays. And at Clifford Chance popular banking partner Malcolm Sweeting won the senior partner contest last year, mainly because of his excellent client track record with the likes of Goldman Sachs.
It is still very much the case that at the big City firms, strong personal relationships with major financial institutions can get you to the top. Although managing partners still set policy, senior partners – who often stand outside the strict management reporting lines – have huge influence.
Indeed, the question everyone is asking about Simmons is whether it will reopen discussions with a US firm following its failed merger talks with Mayer Brown last year. Simmons’ new senior partner will certainly have a view on that.