Andersen Global – the tax and legal adviser – has set out rapid growth targets that would see it operating in 100 countries in three years' time. This would more than double its existing footprint.

It currently has a presence in 48 countries, 39 of which have a legal capability. But Mark Vorsatz, who runs the tax side of the business but is also chairman of Andersen Global, says another three office launches are on the way and it aims to add 20 law firms to its network this year.

The firm operates a franchise model where law firms can become part of the network with the later option of adopting the brand.

Andersen Global gained its name when Wealth Tax and Advisory Services (WTAS) – which was founded in 2002 – acquired the legal rights to the Andersen name in 2014, following the collapse of holding company Arthur Andersen, and its legal arm Andersen Legal, in 2002.

Global's growth plans come as the Big Four audit firms continue their march into the legal industry.

Andersen currently has just over 1,100 legal professionals worldwide. KPMG has 2,300, EY has 2,200, Deloitte has 2,500, and PwC has 3,500.

Vorsatz believes Andersen will soon be a major contender alongside top law law firms and the Big Four.

If Andersen achieves its target it will top KPMG, EY, and Deloitte. KPMG currently practices law in 76 countries, EY in 83, and Deloitte in 85. PwC says it already practices law in more than 100 countries. However, the Big Four are all in expansion mode.

What is Andersen Global?

Launched by 23 partners of the defunct accounting firm, Andersen Global first began focusing on tax advice under the Andersen Tax name but has now expanded to provide legal services, creating two divisions – Andersen Tax and Andersen Tax & Legal. Both operate under the Andersen Global brand. 

International expansion started six years ago and created a system under which tax firms or law firms could set up non-exclusive and non-financial collaborations.

Andersen typically keeps a collaboration agreement for a year before offering the firm the opportunity to become a member firm. At that point, the firm can choose whether or not to adopt the Andersen brand. So far, all firms have converted collaboration into brand membership.

Typically, Andersen aims to work on 75 percent legal matters and 25 percent tax matters at each individual firm. Andersen says there is an approval process for partner appointments but firms make their own local hires.

Andersen currently has no member firms in the U.K., but in the next 18 months hopes to consolidate a legal platform. 

“It's been a tough market for us to get into,” says Vorsatz, “because there aren't many good independent tax practices in the U.K. and we have been hesitant to set up a legal practice. With most workflow coming out of either the U.S. or the U.K., we didn't originally want to conflict with our other regions.”

For those reasons, Vorsatz says Andersen has previously declined a deal with a U.K. law firm. However, he says that because Andersen has expanded dramatically since declining the deal two years ago, it has a much more appealing offer to consolidate an even better deal in the U.K.

With 136 current locations, Vorsatz says they get three to four firms a week coming to them to begin collaboration conversations. He expects to secure a presence soon in a number of countries including Oman, Romania, Croatia, Bulgaria, Czech Republic, Columbia, Chile, Bahrain, South Africa and Zambia.

The growth in numbers

Comparing Andersen to private practice firms, Vorsatz points towards the following statistics:

Dentons currently has the largest geographic coverage, with 78 countries worldwide. DLA Piper has 45 plus some locations operating under DLA Piper Africa, Baker McKenzie has 46, and CMS has 41. Andersen Global has 39.

“When I first started telling people we're growing out, there was quite a bit of scepticism from partners in other firms. Now no one doubts our ability as we continue to execute our goals,” he says.

“We're a little different to law firms,” says Vorsatz, “in that we look at the business as being relationship-driven rather than transactional-driven.”

He says that while bigger law firms are often focused on money centres as opposed to having a broader international presence, Andersen believes its international approach will pay off. He adds: “If we can build relationships with clients in 27 countries in EU, then we'll get the transactional work in turn.”

Andersen launched in Nigeria in 2017. The network now includes eight member firms in Africa, and aims to get to 20 by the end of this year. 

In 2017 it also launched in Duesseldorf, since when it has gone from a 10-person headcount to 75, and aims to reach a 300-500 headcount in three to five years.

Just this year, Andersen Global started with 513 partners and has already boosted that to 565, through hires and organic growth. In the past two months, it has secured collaborations with firms in Peru, Budapest and Luxembourg, and a member firm in Poland. 

Vorsatz says he wants to add 1,500 people globally this year, including 100 partners.

Although Vorsatz' three-year target would overtake the number of countries in which EY, KPMG and Deloitte have legal practices, even without expansion, the Big Four still dominate overall: EY and Deloitte operate in 150 countries, KPMG in 154, and PwC in 158.

And if the Big Four continue to expand their legal arms, Andersen may face an uphill battle to keep up. Partners at the Big Four have confirmed they have no interest in standing still.

Facing competition

But Vorsatz says he can see a gap in the market, which provides an opportunity: “If you look at the Big Four, the fastest-growing segment of their business is the consulting arm. I believe that within 10 years we're going to see a separation of the consulting arms from the legal arms – that's a logical evolution.”

Regulatory issues aside, he says the legal arms may well seek their own independence from the rest of the consulting business. With the biggest proportion of revenue coming from the audit work, he says resource allocation and financial priorities are not given to legal arms, so often they become less attractive for partners as potential employers.

Vorsatz adds that if the Big Four separate their different offerings, they will be “formidable”. But until then, Andersen has the advantage of being nimble and able to seek out opportunities that may be presented by any disagreements over independence.

Vorsatz explains: “A couple of years ago, I met with the managing partner of immigration law firm [Fragomen Del Rey Bernsen & Loewy]. What he told me was that it took him 15 years to add 30 locations to his firm. He said to me: 'you guys have already done in 10 months what it took us 15 years to do'. He was dumbfounded by us.”