Despite high-profile allegations of financial wrong-doing coming to light in recent weeks, over half of partners believe firms' financial controls and governance frameworks are working effectively. Simon Petersen reports

Partners remain bullish regarding the ethics and governance standards at major commercial law firms despite several high-profile investigations involving alleged financial wrong-doing.

The latest Legal Week Big Question survey found that 56% of respondents think the quality of financial monitoring and governance frameworks at major law firms is 'good' or 'excellent'. A further 25% believe such standards are 'OK', while 18% said they are either 'poor' or 'could be better'.

In addition, the respondents believe that ethical standards at partner level are generally robust, with 84% rating standards as 'very good' or 'good'. Just 4% believe ethics at partner level are 'not good' or 'very poor'.

The results strongly suggest that most City lawyers believe the several high-profile cases of alleged financial wrong-doing at partner level at top 50 law firms are exceptional.

Notably, Hogan Lovells last month announced that it had dismissed litigation partner Christopher Grierson after it emerged that he had allegedly wrongly claimed £1m in expenses over four years. It also last week emerged that former Ince & Co partner Andrew Iyer has been referred to the Solicitors Disciplinary Tribunal after an initial investigation by the Solicitors Regulation Authority (SRA) for alleged misconduct.

Squire Sanders Hammonds European managing partner Peter Crossley commented: "What happened at Hogan Lovells is very much the exception to the rule. The vast majority of partners in our profession are extremely trustworthy."

He added: "Every firm has to ensure that it has full and proper checks and balances in place. One never wants a situation where one partner is given too much authority over a firm or a client's money. You need to have proper governance in place, and I believe no firm can afford to be complacent about this."

Macfarlanes senior partner Charles Martin agreed: "I don't think the rare instances of possible problems are the tip of an iceberg, but are very much a rare exception. Partner ethics in City law firms are high and problems are very rare.

"I suspect there may be slightly differing nuances of attitude across City law firms depending on firm culture, but in all cases you would expect partners to behave in a thoroughly trustworthy and accountable manner."

Partners also believe that the legal profession has a good record of ethical behaviour in relation to other professional service firms, with 72% believing law firm partners have better standards than their counterparts in banking and accountancy. Only 4% believe senior lawyers have done worse than comparable advisory businesses on this yardstick. Eight out of 10 respondents also believe that questionable expense claims by partners are either 'unusual' or 'very unusual'.

The poll of partners did find that the majority believe the police should investigate claims of wrongly claimed expenses involving large sums ahead of professional regulators. Two thirds of respondents agree the policy should handle such cases ahead of the SRA – including 35% who 'strongly agreed'. Only 8% clearly feel that the SRA should take the lead in such cases, with 26% being unsure.

Such sentiments are a contrast to the situation with Grierson, in which Hogan Lovells reported the matter to the SRA rather than the police, after seeking guidance from the regulator.

Wragge & Co real estate head Adrian Bland said that the profession must take a tough line on ethical lapses: "My personal experience is that partners at major law firms are generally highly ethical. If a partner stumbles, it is a big story because it is so unusual.

"A firm's reputation is absolutely paramount – the longer you're in the business the more you understand that. If you do something that brings down the reputation of your firm, you are destroying the business and no sane partner wants to do that."

Crossley added: "By and large every firm has tightened up considerably over the last 10 years, particularly with technological change being what it is. Every firm has had to adapt, and that process is ongoing."

Partners on ethics

- 84% of respondents believe partners have good or excellent ethical standards;
- 72% see the ethical standards of the legal profession as higher than accountancy or banking;
- 66% think the police should investigate wrongful expenses claims ahead of professional regulators; and
- 20% think it 'quite common' or 'common' to see partners make questionable expenses claims