has announced radical plans to ditch its sacred all-equity partnership model.
The momentous move will result in the creation of the magic circle firm’s first-ever salaried partners based in Beijing, Hong Kong and Shanghai.
Freshfields Asia chief Perry Noble told The Lawyer that the move is a retention tool and a defensive measure aimed at reducing the risk of senior associates who miss out on partnership jumping ship to rival firms.
He said: “It takes a complex mix of attributes to be an equity partner at Freshfields. Even with great raw material, much depends on the development opportunity, the types of clients you act for, the nature of deals you handle and the quality of practitioners you interact with. Some other firms aren’t as strict.”
Noble argued that it is more difficult to polish up on these skills in developing economies. “The purpose of salaried partners is to help our senior lawyers refine these skill sets. We envisage this to be a two to three-year process, after which the salaried partners would be expected to graduate to full equity,” he explained.
The first cohort of salaried partners are expected to be made up at the start of the 2007-08 financial year, with between three and five senior associates being promoted to the newly created rank within five years.
Noble, however, claimed that the need for salaried partners in Freshfields’ China practice is likely to disappear over time.
The move is hugely symbolic, because only last month Freshfields senior partner Guy Morton told The Lawyer that he favoured an all-equity model (The Lawyer, 30 January).
Freshfields is the only magic circle firm that is an all-equity partnership.
In a separate move, Freshfields China managing partner Mike Moser will be retiring from the firm to be succeeded by New York-qualified M&A specialist Douglas Markel.