RPC set for international expansion and governance review under new leadership
New RPC managing partner sets out priorities for firm, following long-serving leader Watmough's early exit
February 20, 2017 at 10:18 AM
6 minute read
RPC is facing its biggest management overhaul in years, with new leader James Miller replacing longstanding managing partner Jonathan Watmough at the end of January.
Watmough's departure was announced by the firm in December, but it has now emerged that he went on sabbatical last July – 10 months before his third term was officially due to end on 30 April this year.
Former insurance head Miller was appointed by the board that month, alongside corporate chief Tim Anderson as interim co-managing partner, meaning that, in fact, he has already had seven months to get used to the role he formally took up on 30 January.
Miller said: "Jonathan raised the sabbatical as an option 20 months before it took place. We have a five-year business planning cycle; that process came round again. It was a good moment – if he wanted to do something new – to take that opportunity."
Miller said a governance review is due before the end of the current financial year, with the length of the managing partner's term and the size of the management board both up for discussion.
"One thing on the agenda is looking at the managing partner term. Under the deed currently, it is three years. I guess it depends how the partners feel. The length of the term could change. We also have quite a large management board. I expect we could trim that."
The senior partner term, which is also three years, is not under review. Rupert Boswall was re-elected to take a second term in that role in January.
Watmough held the managing partner position at RPC for eight years, encompassing three uncontested elections. He first became managing partner in 2008 and subsequently requested and was granted an extension to run for a third term. A source close to the firm said it is unusual for RPC leaders to secure consent for a third term, so a second extension and fourth term would have been exceptional.
News of Watmough's sudden exit in December raised questions in the market about the reasons for his departure.
Former partners paint a picture of him as a charismatic, impressive leader who had begun to lose power after a long run at the top. For the first time, he was facing active competition for the managing partner role, with multiple candidates throwing their hat in the ring after years of uncontested elections.
One ex-partner suggests Watmough "wasn't carrying the partnership" towards the end of his term. They add: "He is a very charismatic man. He had a clear vision of what he wanted to do and expected people to follow."
Another adds: "Personally, I would say Jonathan was supportive of me until it became difficult due to the competing interests of the partners. He was so keen on my practice, but other partners weren't aligned."
Another former partner comments: "He was effective and good at getting things done. If anything, he was allowed to get on with too much – he had a lot of autonomy. He's a dynamic man; charismatic and impressive."
Speaking to Legal Week in his first interview since becoming managing partner, Miller insists there will be no major changes at the firm under his leadership: "The formula we've got is a good one – we are fiercely independent, people are at the heart of what we do, and we're not going to undertake massive strategic changes, because I think we are on the right path."
Since Watmough took over at the head of RPC, the firm has nearly doubled its turnover, from £60m in 2008-09 to around £100m. Profit per equity partner at the all-equity partnership has also increased during the same timeframe, albeit on a smaller scale, rising from £327,000 in 2008-09 to £362,000 in 2015-16, after a 10% year-on-year decline. Global partner headcount during this period has increased 30% from 61 to 79.
According to Miller, RPC plans to continue to grow through lateral hires rather than mergers, and is aiming to add two or three partners to its intellectual property practice, while also looking to grow in funds and commercial disputes.
The firm has built up the corporate and commercial side of the business in recent years, with key hires including a three-partner Wragge & Co corporate team in 2013 coming alongside a push into banking and finance disputes. However, some sources have suggested that under Miller's leadership, the firm could turn its focus back towards its traditional insurance core.
Miller responds: "There's a natural tendency to assume I'm an insurance partner and therefore the push will be on insurance, but if an insurance opportunity or a commercial one comes up, I'll pursue it. The balance we have now is good, so we are going to build on that – there will be no volte face."
However, the firm has identified opportunities to expand its international insurance offering. "There are new markets coming online; new jurisdictions opening up," says Miller.
He highlights Asia in particular, where the firm has offices in Singapore and Hong Kong: "China is opening up. Markets out there are purchasing more insurance than they used to, and our clients are moving out there.
"There are some very good lateral hires in the pipeline in Asia. We have just expanded our corporate offering with two hires there – we are very active and have a great client base across the region."
The firm is also ambitious about driving its insurance consultancy business forward. During 2015-16, the consulting business generated total turnover of £1.05m but made a loss for the year of £2.6m. "The business has enormous potential but it is still early days. We would hope [that] in the very near future, in the next financial year, we will be profitable. There's no reason why it can't be a £50m business."
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