Good Neighbours
The proportion of a UK law firm's work that has an international dimension has rocketed in recent years. For firms without their own-branded network of offices, meeting the client demand for international coverage is hard but rewarding work, argues Chris Hale
May 24, 2006 at 08:03 PM
6 minute read
Some 10 years or so ago, the prevailing view in the legal community was that to undertake the best quality legal work in the future, it was essential to have own-branded offices in a large number of different countries. In doing so, law firms were simply copying the large accounting firms and large corporations – for understandable reasons. Many English and US law firms embarked on a headlong rush to set up new offices or to merge with existing organisations overseas – with mixed results and causing fundamental changes to their culture. A handful of firms, including Travers Smith, concluded that it was possible to obtain a decent share of the best work by adopting a different approach, the key ingredients of which were a resolute focus on their existing strengths, operating principally from one financial centre and developing a network of like-minded firms in other countries. The evidence appears to show that there is room at the top of the legal market for both models to operate successfully.
So, how does a firm like Travers Smith find international firms to refer work to? All leading commercial and corporate law firms have had an international dimension to their work for many years and have been used to working with other law firms all over the world for a long time. At Travers Smith, the more recent change is that the proportion of work involving an international dimension has increased significantly and as a result we have had to deepen our existing relationships and develop new ones.
There was a fear a few years ago that all of the top quality independent firms – in western Europe, in particular – would be swallowed up by either US firms or our English competitors. As it has turned out, the point has now been reached where those top domestic Continental law firms that wanted to merge or enter into alliances with Anglo-Saxon firms have done so, and most individual partners in those firms that have not done so who wish to join an Anglo-American firm have moved to one.
If you now look around Europe, you will find that Scandinavia, the Benelux countries, the Iberian peninsula, France, Italy, Switzerland and Austria are all well served by a group of profitable, self-confident, independent law firms which are making a very good living from a mix of domestic work and international referrals. The position in Germany was, for a while, less clear, although even there the picture is changing, as the core of high-quality independent firms is joined by others falling out of alliances and re-asserting their independence. Generally, these independent firms are able to be more competitive in pitching for their own domestic work than the international firms and the partners in them prefer what they see as the cultural advantages of independence. There is no reason, therefore, to suspect that in the short to medium term these independent firms and their resources will not continue to be available to us.
The result is that we are able to source our foreign law advice needs from larger offices with greater resources and a greater depth of specialisation than is often available to those firms that are following the own-branded approach from their own offices. Even the firms following the multi-office approach will rely on other firms for their legal needs, in countries where they have no presence. No law firm, at least yet, shows any sign of setting up an office in every country.
At Travers Smith we have an international committee of four partners with the responsibility for co-ordinating our relationships with our legal 'best friends'. This involves a panoply of tasks; most notably, regular visits over-seas, receiving reciprocal visits from partners in our correspondent firms, joint training initiatives and secondments. One of the most important objectives in all of this is not only knowing particular firms, but knowing individual partners and associates in those firm. Without good personal relationships between individuals at Travers Smith and our correspondent firms, it is difficult to provide the seamless service we aspire to provide to our clients. In just the last three months our partners have visited correspondent law firms in the US, Canada, Finland, Denmark, Belgium, Holland, Sweden, France, Luxembourg, Spain, Italy, Hong Kong, Japan, India and China. At the same time, partners from firms in each of these and other jurisdictions have visited our offices to keep up the relations they have developed with individuals here. This is a never-ending process. Through it, we develop the network we work with.
So what are we looking for from the firms we work with? The two most obvious features of what we are looking for from our relationship firms are high-quality legal advice and responsiveness. In addition, we are looking for individuals within those firms who have a good understanding of the needs of Anglo-Saxon clients, who speak fluent English and who we get on well with.
Inevitably, some firms and some partners within those firms are better suited to some types of work than others. As a result, we aim to work with at least two firms in each major jurisdiction. This is a luxury not available to those of our competitors who are seeking to build a one-stop shop network.
One advantage of a firm with its own offices might be its ability to deliver a single bill to a client covering all jurisdictions. It has certainly been a justifiable criticism of firms that rely on networks that the client in the past has found itself receiving all sorts of different bills, in different currencies from firms in different jurisdictions, some of whom it may have had no direct contact with. One thing we have spent a considerable amount of time working on, and one thing we do look for from our network firms, is a common understanding of the way billing is to work and an ability for us to deliver a single bill to the client in the same way as those firms with their own offices.
There will be clients who, for good or bad reasons, will prefer the approach of those firms that are seeking to set up offices in many locations. A very significant number, however, do not. We are convinced that the quality of legal advice we are able to deliver is at least as good as the firms following the alternative model and, in many cases, better.
Chris Hale is head of corporate and private equity at Travers Smith in London.
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