David A. Scherl will step down as Morrison Cohen's chairman and managing partner, positions he has held for 17 years.

Steven M. Cooperman, 51, and Y. David Scharf, 50, have been elected vice chairmen of the midsize firm, effective immediately. They are expected to become co-managing partners in January of next year when Scherl will become chairman emeritus. Scherl said he chose January because that seemed the right amount of time for a smooth transition.

Steven M. Cooperman

“I'm really doing this personally because I love this firm, and I think this is an opportunity for a firm to invest within itself and I think it's unique,” Scherl, 56, said in an interview. “Generally, the managing partners are well into their seventies and take a lot of coaxing to make such a decision.”

The firm announced the transition to its staff at a meeting 3 p.m. Monday. Separately, Scherl said the firm is recognizing the significant contributions being made by some 10 to 20 partners who have the primary relationships with the firm's most important institutional clients. This group of partners will receive increased economic incentives, he said.

Scherl, who said he has no plans to leave the firm, will continue to counsel the firm's most important clients. He said that giving up the management responsibilities means he'd likely have time to sit on boards of private equity or portfolio funds, positions he previously turned down.

Cooperman and Scharf said they don't plan any dramatic changes such as a significant increase in head count and that they are not open to any merger offers.

Y. David Scharf

“We love who we are and what we are and so to the extent, you see changes from us, it will be more in the line of enhancements and growth in those prescribed areas,” Scharf said.

The new leaders are not that much younger than their predecessor but Scherl said, “It's not a question of just age. It's a question of where you are in your career.”

Scherl sees the move as a strategic way to create stability for institutional clients who know that the next generation of partners and those below them are making a long-term commitment. He said the firm is following the kind of succession planning that they'd ordinarily advise their clients to do.

“My mindset is that lots of larger firms have been able to institutionalize clients over the course of time. I think that's a challenge for boutiques and also a challenge for mid-market firms,” he said. ”The end game is really an investment into the next generation.”