Editors' Blog

UK's law firms made of sterner stuff than merchant banking pushovers

Posted 23/04/2007 by John Malpas

Writing in the Financial Times this morning, John Gapper heralds the global success of a class of City institution that would traditionally be regarded as having been staffed by ‘barrow boys’ (see article). While posh merchant banks such as SG Warburg and Barings singularly failed to adapt to the post-Big Bang environment, says Gapper, "déclassé" inter-dealer brokers, led by Tullett Prebon and Icap, are strutting the global stage with aplomb.

He adds: "This is a tribute to the culture from which they emerged: a tough, scrappy hyper-competitive world that was a far cry from the languid charm and amateur management of merchant banks."

The nearest thing you get to 'barrow boys' in the legal world are, of course, the clerks, who continue to run most sets of chambers, despite the emergence of a new class of practice managers from marketing backgrounds. I say this with some trepidation as many clerks find the tag ‘barrow boy’ deeply condescending.

But what of the legal world’s equivalent to the toffs who failed to steer the venerable merchant banks on to the global stage – the people in charge of the UK’s leading law firms? "Languid charm" is not a trait that could easily be ascribed to the likes of David Cheyne and David Childs.

In a recent blog, Legal Week deputy editor Alex Novarese took exception to the widely-held assumption that the US firms will sweep their UK rivals aside in the battle for global dominance (see the blog post here). This assumption is at least partly informed by the historic experience of the UK’s venerable merchant banks. And yet the UK’s law firms have been operating in a far more competitive environment than that which the banks were exposed to the aftermath of Big Bang.

This is in part thanks to the UK's status as one of the most deregulated legal markets in the world - an environment that has toughened up UK firms both for their expansion abroad and their efforts to fend off the advances of US rivals. They may not be barrow boys, but the people in charge of the leading UK firms are no mugs.

By the way, in the blurb accompanying the FT’s redesign today there is a plug for Martin Lukes’ column and its "uniquely funny world where 'thought bullets' and 'creovation' are the order of the day". Overheard on a train the other morning in the real world: "Before you go to the meeting, I’ve got some bullet points I want to load you up with."