China Watch: A Foreign Lawyer’s View from the Inside
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26 March 2014
A couple weekends back I attended my firm’s semi-annual partners’ meeting in the outskirts of Beijing.
Robert Lewis is international managing partner at Zhong Lun Law Firm, Beijing
A couple weekends back I attended my firm’s semi-annual partners’ meeting in the outskirts of Beijing. This was my second partners’ meeting after joining Zhong Lun (ZL) earlier this year, the first being in Chengdu, where ZL had just opened a new office.
Being a foreign lawyer in a leading Chinese law firm after 25 years in international law firms in the US and China is a unique cross-cultural experience to say the least. ZL’s recent partners’ meetings are a good case in point.
When I was at Lovells in Beijing (where I was the managing partner of the office for 9 years preceding the merger with Hogans), our global partners’ meetings were held in London, Mallorca, Cannes, Barcelona and other destination resort locations in Europe. London was notable for the time a German senior partner made a presentation in drag as Julia Roberts’ long-lost sister (not sure that would fly in a US firm!). In Barcelona we had a spectacular meal in a twisted building designed by Gaudi. Cannes was particularly memorable because of the Roman Polanski suite on the same floor of the hotel where I stayed one year. (I often wondered what kind of memorabilia would be placed in the RP suite – would it relate to his films or his legal problems?)
The Ruilin Bay Hot Springs Resort Hotel in the Shunyi district of Beijing, about an hour outside the city proper, where ZL held its recent partners’ meeting, has no Roman Polanski suite, but it does have a new Rolls Royce Phantom sedan parked in a roped off display outside the front door (to show that this was a top class facility) and a “Relaxing Bar” overlooking a man-made oriental rock pool and garden with a 20-meter tall artificial rock formation and waterfall. Instead of elegant European dining, we had Chinese style buffet, which is a disappointment for all who love Chinese food. (I once had a Lovells partner in Germany remark that the two great cuisines of the world were French and Chinese, but one could tire more quickly of Chinese food than French. I replied that was most certainly the case if one ate Chinese food in Germany, but the same is, unfortunately, also true if one eats too regularly at a Chinese buffet even in China.)
Having now attended two ZL partners’ meetings, I can safely say that they are very Chinese in form and content. Although almost all ZL lawyers speak/read English at a high standard (although some of our best partners do not speak English), all of the presentations are in Chinese only. The same is true for all internal email communications in the firm, our intranet, etc. (Our public website and other advice and communications with foreign clients, though, are all in English.) It can make for tough sledding for some of our other non-Chinese colleagues whose spoken/written Chinese is not up to par.
Other Chinese touches abound at the ZL partners’ conferences. For example, every 20 minutes young Chinese waitresses dressed like 1950s airline attendants come in to refresh our tea (a service tradition that somehow did not make it to England with the tea imported from China). Finally, the PowerPoint slides are uniformly unimaginatively designed with nothing more than an endless series of bullet points. (OK, that is not really a difference with international law firms. We recently had a top DC firm make a presentation to our clients in our offices, and while the content was superb their slides were just plain ugly.)
On the other hand, much of the content of the presentations at the partners’ meetings of Lovells and ZL are fairly similar. Both include lots of statistics, e.g. at this conference I learned that ZL has added 20+ new partners since the last partners’ meeting six months earlier for a total of nearly 150 partners and 600 lawyers, revenues are up 30+% over the same period last year, the new ZL tax practice is booming, our other core practices continue to be highly regarded and perform well, our expanded Hong Kong office is gaining momentum, we were named 2011 national law firm of the year for China by Chambers Asia, yadayadayada.
There are other similarities: Lovells had practice group break-out sessions; ZL has practice group break-out sessions. In each case, partners all have opinions about all sorts of topics but when the conference is over most go back to put their heads down to focus only on their work on their desks. It’s tough to get anyone to give priority to the important over the urgent no matter where you are. In some ways it is comforting to see that lawyers in China as every bit as independent-minded as lawyers and professionals everywhere else. (A good friend of mine previously headed up a big-4 accounting firm in China and described managing his partners like herding cats. It’s the nature of the beast, I expect, in all the professions.)
But it is also encouraging to see the progress being made by the elite tier of Chinese law firms. The Chinese legal profession is still quite young and immature. The Big 3 national law firms (Jun He, King & Wood and ZL, probably in that order) are each only around 20 years old. This generation of Chinese lawyers had no prior generation to mentor them. There were no precedents, professional standards, or management systems to inherit, no lore of the law or the profession to absorb from those who went before them. They had to learn it all on their own, with, of course, a sizeable assist from the foreign law firms which have trained so many of the partners in ZL and the other top Chinese law firms – a classic example of creating a monster which then threatens to eat your proverbial lunch (at least in China).
The top dozen or so Chinese firms have made substantial progress in terms of law firm management systems and structures. The Big 3 have invested substantial (by Chinese standards) resources in back office infrastructure (ZL engaged Microsoft to develop a proprietary back office system for the firm’s 8 offices on a unified basis) and have adopted different forms of partner lockstep or point-based partner remuneration systems to encourage partners to cooperate in productive ways that benefit clients, the firm as a whole and the partners individually. K&W is a true lockstep; Jun He is a complex point system; and ZL is a modified lockstep. All conduct comprehensive partner performance reviews to assess and reward both monetary and non-monetary contributions.
But outside of this leading group of a half dozen or so firms, most Chinese firms are nothing more than oversized barrister chambers – there are some shared costs (often only minimal at that) but otherwise all partners are independent profit centers. In the more traditional Chinese law firms (if it can be called tradition after only 20 years), it is “eat what you kill” in the rawest form imaginable, resulting only in clusters of independent practitioners.
So sitting with all the ZL partners at our recent partners’ meeting, it was quite satisfying to see not only the familiar form of the broader law firm management model borrowed from the large international law firms but also much of the substance. ZL and the other leading Chinese law firms are perhaps only half way along the path to achieve parity with the large international firms in terms of firm or practice management, but with only such a short history and starting from zero, that in itself is a miracle in progress.
Robert Lewis is a US lawyer qualified in California who has lived and worked in China for nearly 20 years. He was one of the first senior foreign lawyers to move from a large international law firm to a local Chinese law firm in 2010.