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The recently appointed global head of legal services at Big Four accounting firm KPMG, Stuart Fuller, plans to expand the firm's legal services in Asia-Pacific and the Americas and make the legal offering more visible both inside and outside the firm.

In an interview with Law.com in Sydney, Fuller described his growth plans for the legal services arm of the firm and offered his view on how the Big Four fit into a legal services profession dominated by traditional law firms.

Fuller, who is based in Sydney, takes over as global head of legal services at KPMG from Zurich-based Juerg Birri on August 1. While assuming the broader role, he will also retain the role of Asia-Pacific legal services leader.

"We will continue to grow in Europe. There's no doubt about that," Fuller said. "But the rate of growth in Asia-Pacific and the rate of growth in the Americas will be higher. Therefore, there will be more of an even balance across those three regions than there is now."

KPMG's legal services arm currently has more than 1,850 lawyers in Europe, the Middle East and Africa, more than 300 in the Americas, and over 250 in Asia-Pacific.

Stuart Fuller

Fuller noted that the heavy European weighting is merely a product of history, as Europe is where KPMG began its legal services offering. But he said he wants to "build out the footprint" in Asia-Pacific, in Canada and in Latin America.

"It will be in more jurisdictions," Fuller said, noting that KPMG Legal Services is planning to open an office in Shanghai by the end of the year. "We've got a number of other markets in Europe, Asia-Pacific and the Americas under constant review."

In January, KPMG launched SF Lawyers in Hong Kong but remains the only one of the Big Four that does not have a legal offering in Singapore. Fuller said there are no specific plans to open an office there.

"My approach to things is you need to make sure you've got a client demand for it, which I'm pretty confident we have. Secondly, you then need to make sure you get the right people. And thirdly, frankly, you just need to keep most of these markets under watch and be opportunistic," he said.

Overall, the firm's legal offering will be larger and have more lawyers in the next few years – an expansion spurred by business growth for clients and increased regulatory and compliance burdens, Fuller said. He declined to say how much larger.

Growth will come in those areas where KPMG Legal Services has the talent and where the broader firm has existing strong franchisees and client demand – cross-border M&A, regulatory compliance and financial services. Advising clients on legal aspects of digital technology, such as privacy laws, consumer data rights, commercialisation of data and drawing on data to improve business efficiency, is another growth area because it involves both consulting and legal work.

The "vast majority" of KPMG Legal Services' work arises from existing clients and from working with KPMG consultants from different parts of the firm, he said.

The major hurdle for the firm's legal services business is raising awareness among clients and potential clients, Fuller said.

"The biggest challenge we've got is building the brand. When you are a law firm, the clients and the market innately accept that you can do legal services," he said.

Despite the fact that legal services is a large function at KPMG, it is still a newer function, he explained.

"In terms of the brand, and clients automatically thinking, 'yes, you know, I could go to KPMG or PWC or Deloitte or EY for legal services' – they are aware of it, but it's not as natural an awareness as a law firm."

Of KPMG's 220,000 staff globally, only 2,400 are lawyers, with 250 partners, and Fuller said a challenge is how to "make ourselves more visible, and therefore more relevant to the non-legal parts of KPMG and for our clients".

"You really have to over-project or be overly visible in order to get known and get visible," he said.

He described the legal services market as "brutally competitive" and highly dispersed, adding that even the world's largest law firm by revenue, Kirkland & Ellis, had revenue of only $3.2 billion in its most recent fiscal year.

KPMG's combined global revenue, for all its services, totalled $29 billion last year.

Fuller, who joined KPMG in March 2018 after 27 years at King & Wood Mallesons, including as global managing partner, dismissed concerns that the Big Four accounting firms were taking work from traditional law firms.

"The market is growing enough that big law firms and legal services capabilities in the Big Four can coexist quite nicely," he said. "I think it's insecurity on the part of the law firms sometimes to keep talking about this threat of the Big Four. It's an overstated argument. "

Even so, Fuller plans to better integrate KPMG's legal services offering with the rest of the firm, which he said could give the accounting firm an advantage over traditional law firms.

"I'm a great believer in that one-stop-shop model," he said. "How do we get further and better integrated with our deals, colleagues, our advisory colleagues and our consulting colleagues so that we go to market together as the KPMG services – whether it's corporate finance, M&A plus legal services, or risk consulting plus legal services, or management consulting transformation and legal services?"

"The one-stop shop is a key advantage that professional services firms have over traditional law firms because there is one relationship partner, one responsibility to the client, and one engagement to the client," he said.

Having the lawyer in the room at an earlier time, when a transaction is being framed up or an issue is being clarified, is another advantage, Fuller said.

"There's no doubt about it. Advisory firms such as KPMG are engaged by clients earlier than by the law firms," he said. "If we can get the lawyers from legal services into the room earlier, we can actually shape the solution faster."

Finally, there is the advantage of geographic coverage. Even the largest law firms are "nowhere near" KPMG's 77 jurisdictions, so it is more likely the firm will have a legal presence in the country where the client is doing business, he said.

 

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