Last year was traumatic for many law firms. Few avoided staff cutbacks or shorter time working. In many cases partners took home significantly less than they had earned in recent years and managing partners have had to take tough decisions to deal with the downturn.
So does this week represent a turn of the page? Does a new decade mean a new chance?
Take for example Peter Martyr, of Norton Rose. After the firm’s merger last week with the leading Australian outfit Deacons, Martyr has become group chief executive of the Norton Rose Group. This means that he has ultimate responsibility for lawyers as far away as Bangkok, Beijing, Ho Chi Minh City, Singapore, Sydney and Tokyo.
On Monday morning, however, he found himself on a very chilly Watford Junction station where the irony of that far-flung legal empire was not lost on him. Once, Norton Rose’s aspirations were linked to the success of a chain of regional firms spread out along the M5 motorway. But at a critical juncture (after the IRA Bishopsgate bombing) the firm opted to go decisively down the international route.
“If you want to be in the global game then you must either be a boutique firm, a top domestic practice — like Slaughter and May — or you need to have a substantial international footprint,” he says. “Size is important if you want to operate internationally and I am glad to say that we have got over the curve to achieve that. Firms that have not made it are now likely to drop away.”
Looking ahead to conditions in 2010, Martyr thinks that now is the right time for firms to lay out their stall about where they want to be. Similar sentiments are shared by John Young, the senior partner at Lovells, who is looking forward to the tie up with Hogan & Hartson, the leading US firm, in spring.
Whether this turns out to be the long-awaited top-level AmericanBritish merger that sets the precedent for others to follow remains to be seen. Young confesses that he had always been doubtful about the practicality of the transatlantic merger until he met up with H&H and realised the high level of compatibility — including culture and values as well as practice areas. “Maybe the fact that they are a Washington firm rather than New York makes it easier,” he says.
What should be interesting to observe will be the firm’s parallel growth in Asia and in South America — a novel recipe for any British lawyer.
Linklaters, by contrast, has been closing offices in recent years in response to the downturn. And while it undertook some significant surgery to remould itself to the new realities, David Cheyne, the senior partner, says that 2009 was no worse than expected — and probably rather better.
He says that 2010 remains “extraordinarily difficult to predict” but is reasonably optimistic about a gradual pick-up as the year proceeds. Restructuring work will continue to be important but much will depend on the strategies adopted by the large corporates and financial institutions that make up its client base. But he says: “I don’t expect merger and acquisition work to come zooming back.”