London-based corporate associates vying to make partner at Allen & Overy (A&O) have had their hopes dashed after the firm announced there will be no promotions in the group next year.
The magic circle firm informed lawyers of the decision through its associate forum last month.
A&O made up just one partner in London corporate this year. However, the psychological impact of the announcement will be significant in a department that is struggling to emerge from the shadow of A&O’s market-leading banking group.
Around 67 per cent of the firm’s global profit comes from the London office, where the largest contributor is the banking group. An A&O spokesperson said: “We’re not going to comment on a matter which is going to be announced in May 2005.”
One source said that if there had been an outstanding candidate, the department may have been able to justify a promotion. But given the economic circumstances, the standards by which talent is judged have been driven significantly higher.
Outside London, particularly in Belgium and the Netherlands, corporate dominates other departments, including banking. But last year was poor for the London corporate department, with larger deals thin on the ground. Banking, though, saw increased London revenues.
A&O’s decision is set against a trend to cut down on partner promotions in a number of firms. In the most recent round, A&O, Clifford Chance, Freshfields Bruckhaus Deringer and Lovells, appointed fewer new partners across all departments than in any of the past four years.