Cheyne extols virtues of classical senior partner
It's official. Had he lost the senior partner elections, Linklaters corporate heavyweight David Cheyne would not have quit the firm in a fit of pique. Indeed, Cheyne claims such behaviour from a Linklaters partner would have been "extraordinary", despite the long-running mutterings linking the magic circle firm's top deal lawyer to one Sullivan & Cromwell.
July 05, 2006 at 08:03 PM
7 minute read
It's official. Had he lost the senior partner elections, Linklaters corporate heavyweight David Cheyne would not have quit the firm in a fit of pique.
Indeed, Cheyne claims such behaviour from a Linklaters partner would have been "extraordinary", despite the long-running mutterings linking the magic circle firm's top deal lawyer to one Sullivan & Cromwell.
True to stereotype, the two unsuccessful candidates in the election – global finance head Giles White and head of restructuring Robert Elliott – show no signs of throwing their toys out of the pram.
"The election was remarkably un-divisive," says White. "It was rather boring – we all followed the same line and we all believe in the same strategy."
Such claims, of course, belie the plain fact the three candidates all had very different personal styles and represented separate constituencies within Silk Street. And Cheyne's election promises a watershed for the firm.
Like the current senior partner, Anthony Cann, Cheyne is a former head of corporate. But there the similarity ends. Cann's low profile reflects an understated and inward-looking approach to the role of senior partner. Cheyne's style is altogether more direct.
As one partner observes: "David does not suffer fools gladly, whereas with Anthony it is often a lot harder to tell what he is thinking."
As the former leader of the firm's flagship department, Cheyne is closely associated with managing partner Tony Angel's relentless drive to improve performance at the firm, although Cheyne's methods are regarded as having been a lot more old fashioned.
Cheyne observes: "We realised during the dotcom boom that we needed to do more focusing and that we needed to be clear in which direction we were going. In 2000 we had already started to think that we needed to be better managed."
His five-year tenure as head of Linklaters' M&A practice, if not quite controversial, was considered divisive by some as he set about reorganising the department and, in his trademark forthright style, sending out the message that high performance was a requirement rather than an aspiration.
Though considered successful, some wondered if Cheyne's style was compatible with the ambassadorial, 'voice-of-the-partnership' element of the senior partner brief.
Cheyne, who describes himself as "noisier" before he took the head of corporate role, believes the experience tempered his style. However, he is unrepentant regarding his focus on individual performance.
"I believe everyone should work to the best of their ability and, if that is tough, then I am quite tough. I believe a successful firm means happy people who will try harder and that we should do better, but I would not describe myself as tough. You can do most things with a fair element of consensus and if you are trying to set an agenda, people need to buy in to it."
While the firm's tough approach to management has reaped rich financial rewards, with average partner profits this year breaking the £1m barrier, Cheyne shrewdly appreciated that to become senior partner he needed to put some distance between himself and central command.
His decision to return to full-time fee earning last year should be viewed in this light.
As he notes: "The senior partner is not the managing partner."
Traditionally, senior partners have divided their time between keeping the partnership onside and nurturing clients.
Cheyne praises Cann for his work gluing the partnership together after a series of challenging European mergers, but argues that a settled management structure will afford him the luxury of getting out there and working the boardroom, a skill that many would say only Slaughter and May's Nigel Boardman can match him on.
Not only is Cheyne determined to continue fee earning (unlike Cann) when he becomes senior partner in October, he also wants to muck in and help with client pitches, especially abroad.
And by 'abroad' he does not necessarily mean New York, which has been the focus of the bulk of Linklaters' investment over the last couple of years.
Cheyne's attitude to the US will be watched closely – given his ability to lead the debate within Linklaters' partnership and his reputation for being ambivalent on the merits of heavy investment in the US.
He concedes that finance, where Linklaters has made a series of bold appointments, has so far made the running in Manhattan, but the sheer manpower required means M&A will be a far tougher challenge.
Cheyne also stresses that Linklaters has no intention of moving away from its lockstep or pursuing a New York merger.
"I do not see us merging. We are growing on our own in the US and we want to be bigger and stronger there. We need to be larger in corporate but it is a difficult market to develop fast in. It is very about much how opportunities materialise, but there are people out there of the right quality."
"The international legal market is still relatively under-developed," he adds. "If you look where we are, there are lots of places where we can and should be growing, and the US is one of those."
This may summon up images of bold forays into untapped Asian markets, but it is equally true of Europe, where Linklaters' much- vaunted corporate practice faces stiff competition, not just from a resurgent Freshfields Bruckhaus Deringer and an increasingly confident Clifford Chance, but also from a select band of US firms.
Cheyne should know. Earlier this year Graham White, who was hired under his watch from SJ Berwin to help the firm break into private equity in London, jumped ship along with fellow partner Raymond McKeeve for Kirkland & Ellis.
Cheyne is defiant about the decision to break with decades of tradition and hire a partner into London corporate, insisting that it allowed the firm to build up its buy-out practice quickly.
Many will disagree, with critics citing the failure to integrate the private equity practice into the wider M&A team. Nevertheless, White's departure may well have helped Cheyne by reminding the firm's partners that Linklaters' corporate prowess cannot be taken for granted.
For example, his pledge to focus on clients will have played well in Germany, where the firm is battling to gain market share from Freshfields, Shearman & Sterling and Hengeler Mueller.
As Markus Hartung, Linklaters' longstanding German managing partner, observes: "The companies in the Drax 30 who are reaching out globally know exactly who David Cheyne is."
But it would be unfair to describe Cheyne's emphasis on client-winning as his idea alone.
Both White and Elliott say that they too had stressed the senior partner's client-nurturing brief in their manifestos.
This is no coincidence. It is evident that this emerged as a strong theme within the partnership when soundings were taken over who should succeed Cann. This sentiment is likely to have proved decisive in the election.
As Elliott concedes: "David has been out of management, he has been client-facing and, by disposition, it is natural for him to do this role."
Cheyne's elevation to the top job says as much about where the firm's heart lies as it does about his own particular qualities.
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