Quick question: Does the merger mania afflicting the legal market auger well or not for the law business? Is it panic, in other words, at pressured fees and increased competition, or is it the result of carefully thought through business development and marketing?
The Financial Times reports that the firm came into its present form through a series of mergers in South Africa, Australia, Canada and the US – has elbowed out so-called magic circle rivals from the top of rankings that score the largest firms in the world on their brand power.
The firm is third in Acritas’s global brand index for 2014, pushing out Linklaters and Freshfields Bruckhaus Deringer – two “magic circle” firms – from the top three slot for the first time.
The magic circle are the elite cadre of London-headquartered firms with large international footprints.
While the magic circle and other traditional firms pool their profits from around the world, Norton Rose Fulbright does not. It works on a so-called verein structure, which keeps parts of the firm financially separate with discrete profit pools.
Merging this way is quicker as it avoids protracted discussions about how to marry up two firms’ different profits. Partners – the most senior lawyers – take a share of their law firms’ profits rather than a salary.
Recent international mergers such as those that created Hogan Lovells and King & Wood Mallesons – both of which rose in this year’s rankings – have been similarly structured.
“Norton Rose Fulbright has benefited from the expanded reach and expertise created through its combinations to achieve high levels of favourability among in-house counsel who also value the firm’s key industry sector approach,” Acritas said.
The survey polls 1,185 in-house lawyers in companies around the world with more than $1bn in revenues. Roughly a third of the companies are each based in the US, Europe and Asia. The respondents are asked what law firms first come to mind, and which they feel most favourably towards.
Baker & McKenzie – long known for its large geographic footprint and an operation with Balkanised profit pools – tops the Acritas list for the fifth year, 38 points ahead of the next firm, Clifford Chance, another magic circle firm.
Read more at the Financial Times