Ok …..maybe not the meanest but it does rhyme with leanest !
Our experience tells us this article is talking sense. Australians have always had to operate in a sophisticated but essentially small legal market that is affected more than others by the vagaries of international business, finance and trade.
Law firms have had to deal with this in an inventive way and ever more so since 2008.
We’d suggest that being bullish about the remaining Australian law firms isn’t such a bad idea. Although here at ALE we do think moving lock stock and barrel into an agreement / JV / Merger with a Chinese firm is still something we’d be very wary of. You will lose partner expertise and you may create boutique competition as those partners take their clients with them.
This combined with some of the more frustrating aspects of Chinese business culture and attitude towards work may be the straw that breaks the camels back.
US and UK firms routinely deride the market Down Under. Here’s why Australians deserve more respect
An old friend of mine insists he reads David Hume to clear his mind. My friend is a very smart fellow. Hume, of course, was even smarter. They somehow communicate across the centuries.
Kalis2014
Peter Kalis, chairman and global managing partner, K&L Gates
I’m not as smart as my friend and, perforce, not as smart as Hume. The works of Enlightenment philosophers rarely clear my mind. The entanglements there are of a simpler provenance and typically can be sorted at a sporting event with a beer. But for brain cramps that just won’t dissipate I need to get away. And there’s no better place to visit than Australia.
The Australian recently published the results of a study of the local legal market for the fiscal year ending 30 June. Not a pretty picture. The nine top-tier international firms shed 10 per cent of their workforce and 5 per cent of their partners. Partners who had been spared the worst effects of the global crisis were experiencing headwinds.
Against this backdrop I visited our Australian offices in August along with our indomitable Australian managing partner Nick Nichola and our global vice-chairman Jim Segerdahl. As with my previous experiences in Oz, what looked on paper an exhausting march from Brisbane to Perth to Melbourne and finally to Sydney in fact left me in a crystal clear state of mind. Call it an Aussie state of mind.
Based on press reports, I had expected to see something resembling the barricade scene from Les Miserables outside major law offices. Far from that dismal picture, I found a legal community whose energy is high, whose resilience is evident and whose adaptation to market forces is well under way. In fact, our Australian practice is having a fine year, and I suspect we’re not alone.
It’s mind-boggling that a country of 23 million people can generate a $1.5trn economy – ranking its per capita GDP above that of the US, China, Japan, Germany, France and the UK, among others – and do so with the affability for which Aussies are justly famous. It’s a real haul to get to Australia from anywhere, and yet Australia is highly integrated into the global economy. As to the recent ebb in the resources market, there is a school of thought that this will be good for Australia and allow it to focus on other strengths.
Over a century ago JP Morgan was asked to predict the course of the stock market.
“It will fluctuate,” he said.
True. Markets are not for wimps. They move up and down, and only those sedated by years of undeserved success are surprised. JP Morgan got this, and so do the leaders of the Australian legal profession. The firms there are riding out the re-set of their market while refining their value propositions. I’m bullish on the Australian market. And I’m not alone.
The internationalisation of the Australian legal profession began in earnest a few years ago, when leading firms tied up with counterparts from the US, the UK and China. Interestingly, Australian firms committed to these strategies when their markets were hot. They acted from strength and on a global vision. We denizens of the Northern Hemisphere may not remember that these were among the best law firms in the world. Now they are at the strategic core of international firms such as K&L Gates, Ashurst, Herbert Smith Freehills and DLA International, and are member firms in Vereins King & Wood Mallesons and Norton Rose Fulbright. Other international firms have secured smaller combinations, opened greenfield offices or entered Australian alliances – Clifford Chance, Linklaters and Allen & Overy, for example.
What did my Australian tour reveal? Brisbane, Melbourne, Perth and Sydney are multicultural concentrations of talent, legal and otherwise. The markets vary, of course, but they have in common their place in – and importance to – the wider Asia Pacific region, the influence of strong resources and financial sectors, and healthy investment flows from the US and the region. As for their legal communities, they hardly need a slap on the back from me, but based on my observations I’d say the Australian legal profession holds its own with any in the world.
So what of the purported distress of the past year or two? If you had spent time in New York or London in 2009 you would wonder what the fuss is all about. There is a profound distinction between global crisis-induced hysteria on the one hand and cyclical dislocation and adaptation on the other. The Aussie market is just fine; competitive to a fault, but competition makes us all better.
Law firm value propositions evolve or face obsolescence. At a strategic inflection point some Australian law firm leaders grasped this principle and acted on it. Good for them, and good for us that they did.
