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It is time for the annual round of partner promotions, when ambitious assistants await their fate. Sean Farrell goes behind the scenes at some of the City's top firms and finds out what's required to be among the chosen few.
It is that time of year again, when a smattering of assistants, who have toiled for seven years or more, achieve the summit they have been aiming for - partnership.
The basic model for partnership selection is that departments make recommendations, and then vote on whether individuals should be made up to partners. But there is a lot of variation within this model, and while law firms remain partnerships rather than companies, the quirks easily come to light in the selection process.
No firm will reveal the darker peculiarities of its appointment process, but Alan Hodgart, European managing director of consultancy Hildebrandt International, says horse-trading, blackmail and sheer weirdness remain in many firms.
"In a lot of firms, departments push their favourites and say to other departments if you don't oppose ours we won't oppose yours.
"And you get promises being made and blackmail being exerted on others. They ask colleagues to help them and say [that department] has got five partners and we've got two and you've got one and we'll help you get two if you help us get three and it becomes a numbers game."
He tells of a firm making up a partner because of his wild behaviour.
"It was a stodgy firm that wanted to be more entrepreneurial, and he used to get drunk at parties and they decided this was the sort of person they should have. It didn't work out, and he left within two years.
"It's getting better in firms with more than 250 fee earners. People are asking, what are the functions of a partner in the new world and does this person perform as a partner should?"
One way to reduce the scope for skulduggery and idiosyncrasy in selection is to introduce an intermediary body to make the recommendations. This device is used by many practices to iron out problems early on and ensure unanimity when the formal partnership vote is taken.
Lovells' partnership planning committee is made up of members from different parts of the firm, who assess the business case for prospective partners and seek contributions from partners before reporting to the board. The report, plus the board's comments, goes to a partnership meeting in the spring and a vote is taken.
Simmons & Simmons has had its partnership appraisal committee in place for about six years, but it is elected rather than appointed. The committee comprises senior partner Bill Knight, managing partner David Dickinson and three partners elected from the junior, middle and senior bands within the firm.
Dickinson says: "If each department is represented, it's more difficult than if you are a selected group taking a view on behalf of the firm.
"The partnership has a final decision on the formal recommendations, though it would be unusual to go against a recommendation.
"That's what this system does. People respect the concept of elected bodies, and if they [object to] a recommendation, they have to have pretty strong grounds."
At SJ Berwin the firm's strategy committee decides on nominations, which are put to a partnership vote. "We still manage to get round a single table, and it's a round table discussion," says EU and competition partner Ralph Cohen.
"When I say a vote is taken, one hopes the case has been made out. It's not a question of a show of hands, and it goes through without any strong objections."
Most firms will ask a candidate to be interviewed or to make a presentation to the panel or the board. But Hodgart says at some firms every partner has the right to interview candidates. "Every year there will be some partners who will ask to interview all the candidates."
Some firms go a step further. Davies Arnold Cooper has introduced psychometric testing for its candidates. They were sent away to Manchester Business School to work through tasks while a psychologist observed their behaviour and body language.
DAC's managing director Nick Sinfield told The Lawyer last year that some candidates thought to be ideal partner material fell at this hurdle. The tests measured the non-technical abilities now required of lawyers. "We certainly didn't feel that we, the partners, were able to assess that because we were coming to it from an old-fashioned stance ourselves, so we needed outside help," Sinfield said.
But a spokeswoman for the firm now says the tests are not used to decide whether someone is promoted but to spot areas where they may need support once made a partner. "If someone came out as being completely cracked, perhaps [it would affect their chances]. But that would have been spotted a lot earlier on in the regular reviews."
As firms grow both in size and international reach to become global businesses, the model has to become even more sophisticated. Clifford Chance's elaborate selection process runs from April to February and allows the partners to participate in the process online (see box).
So much for process, but what about the factors at play behind the scenes? One element which affects a lawyer's chance of partnership is their practice area.
Of the 28 partners made up by Linklaters last week, 10 were in the corporate department. With an M&A boom on, it is no surprise that corporate and banking will dominate the new appointments at the big City firms, with assistants in burgeoning vogue areas like structured finance and securitisation also benefiting from predictions of future growth.
But for those in areas such as bond and equity work, which require few partners and lots of assistants, the opportunities will be more scarce - and the same could apply to litigation, which does not fare well in economic good times.
But all is not lost, according to David Baker, chairman of the partnership planning committee at Lovells. "One looks at it in terms of the business case and what the projection is for that practice area, and in terms of the individual - their adaptability should that area not be as successful as one had hoped."
A barrier that varies from firm to firm is post-qualification experience. Baker is happy to say that to become a partner at Lovells you need to have notched up "a minimum of six years, but it can be considerably longer". And no matter how experienced a lateral hire assistant is, they must serve three years at the firm before being considered for partnership.
The magic circle firms are known as places where one has to serve a certain amount of time before becoming a partner. But Jonathan Beastall, who sits on Clifford Chance's partner selection group, insists: "We don't expect people to have served any particular period of time."
But he adds: "They have to have enough experience under their belt to be a partner, and have the relevant expertise." Lateral hires are not promised a fast track to partnership, but "the economics of the marketplace is such that you have to be open with people about how the system will work and how they will fit into the system".
Jonathan Goldstein, the 34-year-old chief executive of Olswang, was made a partner when three-years qualified." At this firm there is no qualification limit or time of service. It's when people believe the individual is capable of commanding a partnership and it's a slightly more intangible test than other firms," he says.
As firms get larger, the days of sitting back and waiting for partnership are long gone and the requirements made by firms are becoming more testing. At one magic circle firm, a source says "the Heathrow partnership" means an assistant is told they are almost ready for partnership but it would be useful if they were to spend three years in a particular foreign office.
Lovells' Baker says willingness to go to far-flung corners of the earth should not prejudice a candidate's chances of promotion. But he adds: "Flexibility in terms of going to these sorts of places is a feature we are looking for generally in terms of partners. It's a positive point, as are languages."
Every partner that is made up risks dilution of the figure for profits per partner. Of course, this has always been important because it determines how much money partners will take home each year.
But with top firms constantly weighing up merger options, healthy profits per partner are an important part of attracting a suitable marriage partner. The Lawyer recently revealed that top Paris firm Jeantet & Associes had imposed a two-year freeze on partnership promotions to buoy its profits as it attempts to attract a UK or US merger partner.
A source involved in reviewing partnership candidates at a top City firm says: "Obviously, in determining whether we appoint new partners we look at the dilution of profits those new partners will make, unless those partners make a profit.We look at how over the medium-term profits will be diluted by those partners coming in.
"But in terms of trying to maintain profitability because of a possible merger, I would have thought anybody doing sensible due diligence would notice that. And it will damage the practice as well, because people will become unhappy."
And keeping good assistants happy is the name of the game these days. With the lure for assistants of doubling one's salary at a US firm or a possible fortune from share options at a dotcom company, are firms feeling the pressure to maximise partner appointments to show their staff they can make it?
SJ Berwin's Cohen says: "It's like a steaming pot. You have got to let some out from time to time. It's that quandary between making people up and losing them."
A partner from a top 10 firm says there is great concern at the salary levels being offered by the US firms and dotcoms. But he adds: "It didn't have an effect on who we considered as candidates. A question is occasionally 'If we don't make this person a partner will they leave?' but either someone's good enough to be a partner or they're not."
In the end the best way to reach the summit is to work hard and show commitment. But the criteria for commitment are becoming greater.
A source reports that at one firm's partnership selection meetings the committee expressed gratitude that candidates had cancelled their wedding and missed the birth of their child to get deals done. "This was the kind of commitment they appreciated," says the source.
But even with this kind of devotion there is no guarantee of success.
Hodgart says: "There can be a blackball at the vote. Partners have said to me assistant X is supposed to be good but I had an incident with them five years ago when the assistant was two years qualified and they would say I'd never vote for them and the assistant would miss out."
So the message is clear. Never exhibit human error, bring in more business than the rest of the firm put together, pretend you have always wanted a three-year posting in Bratislava, do not cross your arms or legs, and miss or cancel all the significant events in your life, and you may just be in with a chance. Otherwise, there is always that dotcom company.
Clifford Chance's partnership process
Jonathan Beastall, a member of Clifford Chance's partner selection group (PSG), says that appointing new partners is one of the most arduous non-fee earning roles at the firm.
The process runs from April to February, beginning with the regional managing partners and global department heads nominating candidates after taking soundings 'at the coal face'. These nominations are accompanied by an analysis of the business case for each area.
The firm has drawn up a standard nomination form which deals with the candidate's personal characteristics as well as the part they will play in the firm as a partner.
'That is circulated to partners in the firm electronically, together with an electronic questionnaire, giving them the opportunity to answer pre-set questions about the candidate and to put additional comments in that they may have,' says Beastall.
At this stage, candidates produce a written document setting out how they will contribute to the firm as a partner. This goes to the PSG but not to the partnership as a whole.
Partners are able to talk in person to the PSG if they want to discuss particular issues about a candidate. The PSG analyses the responses and collects responses from sponsors and others who are interested in the candidacy.
'That will lead to some people falling out of the process and some staying in it,' says Beastall.
The survivors then undergo a two-day assessment exercise. Beastall is reluctant to go into detail about the content but says: 'Candidates are put through different scenarios to assess their non-legal skills, dealing with management issues, business development issues and personnel issues.'
Candidates are also required to give a presentation to the PSG during the assessment exercise.
Once all the information is assembled the candidates are put to a partnership vote. 'Experience is that the recommendation will be followed. The process is designed to build consensus,' says Beastall.