19 January 2004
I was looking forward to meeting Freshfields Bruckhaus Deringer’s German co-senior partner elect about as much as his colleagues probably look forward to doing their tax returns. The German contingent of Freshfields is still largely über-conservative and highly secretive. When my phone calls are eventually returned, the conversations are always polite, but the person at the other end of the line would patently rather be doing something else.
Konstantin Mettenheimer and I did not get off to a good start. To be fair, the fault lies not with him primarily, but with the PR bod he brought over with him from Germany. When the chap in question comes to collect me from reception, I catch him blatantly looking me up and down with what can only be described as disdain bordering on contempt. Now I would not describe myself as oversensitive, and the man may even have a point – it is windy outside and I am wearing last year’s urban utility trousers, while he is dressed with military precision – but he obviously missed the induction session where HR explains that Freshfields lawyers and support staff are models of etiquette and keep such opinions to themselves.
So, inevitably, when I first sit down with Mettenheimer, I am slightly on edge. So is he. Then things go from bad to worse. The PR man asks if we can “check quotes” after the interview. This is a pretty astonishing request considering the interview is being tape recorded. You would not have thought there was a great deal of room for error.
Initially, I am worried that the interview will not go ahead and my trip to Fleet Street has been wasted. However, Mettenheimer demurs and agrees to be interviewed without any kind of retroactive copy control. (I would like to say that this was the end of the matter, but the German PR called the following week to try to change the terms and allow advance access to “check quotes”. But that is another story.)
The whole sorry saga is a bit of a shame, because the charade over copy control detracted from the fact that Mettenheimer is not only a bit of a charmer, but also relatively open and honest once he gets going. I thought I would start with an easy one, so I ask him about his recent election to the co-senior partner position.
Freshfields’ electoral process looks complex, if not labyrinthine, to the uninformed outsider. In a nutshell, the partners elect a consultation committee which consults with the partners and then nominates two senior partner candidates, one from England, the other from Germany, whose appointments are then rubber-stamped by a firmwide partnership vote. Got that?
Actually, this sort of consensual appointment is a nightmare for journalists. No manifestos, no hustings, no cat fights… frankly what is there to write about? Mettenheimer wryly apologises that the process is not more newsworthy. “The difficulty with a plain election, the size we are… while I have shaken hands with every partner, if you ask them, ‘Do you really know Konstantin Mettenheimer?’, I suppose a large percentage would have to say ‘no’,” he admits.
Famously, not all his partners agree with him. As The Lawyer reported last year (12 May), between 20 and 30 German partners, mainly from Frankfurt where Mettenheimer is based, put their names to a written request for a more democratic electoral system.
When I ask Mettenheimer about this incident, I expect him either to not answer at all or to gloss over it. He picks the latter, but at least he is engaging with me on the issue and that is a step forward. “Some partners in Germany were unhappy with that and said, ‘Why can’t we have direct elections and they’ll just stand and there’ll be a vote?’,” he says. “I think all – or really almost all – have been convinced by the result of what we’ve had.”
His final words on the subject are: “If you ask me, ‘Is there a little discussion now and then? Is there major friction which is really interesting for the press?’, I’m afraid we always kill that before it even arises. Yes, there is some friction, but it’s really much less than one might think, expect or hear of.”
Mettenheimer is much more candid on Freshfields’ governance. As a result of the Freshfields Deringer-Bruckhaus merger, the Anglo-German firm has two of almost everything: two senior partners and two heads of every practice group, one English, one German. (The one exception is chief executive officer Alan Peck – there is only one of him.) Freshfields has now kicked off a governance review to look at its management structure – after all, how long can one of the world’s biggest firms go around looking like Noah’s Ark.
Mettenheimer is quite clear about what he wants: a more international management. “We’re roughly one-third English, one-third German, one-third the rest of the world. I think it’s really important that in whatever management group we have, be it central management, our partnership council and our practice committee, where you pull together the practice groups, that it’s really a proper reflection of what we are.” Unequivocally he rounds off the speech with: “We’d better change that.”
This all sounds pretty reasonable, but not everyone at Freshfields agrees. Several partners in management and many close to the heartland of the corporate department whisper that Mettenheimer is going too far too fast. Mettenheimer, though, is confident that the firm will get the internationalised management he feels it needs, because “I haven’t heard anybody openly or less openly objecting. Even privately, I don’t think people do [object].”
As Mettenheimer acknowledges, some partners operate on the principle that management positions should simply go to the best man or woman for the job, regardless of nationality. The feeling is particularly strong in relation to practice area leadership, where much of the real power lies at Freshfields.
It is a problem that bedevils all of the UK City firms that have grown to become global players. There is simply not the same management expertise outside the US and London, where the legal sector is the most highly developed and law firms are the largest. So, should the job go to the best qualified candidate?
Mettenheimer argues: “I firmly believe in our firm going global, being truly international, not everywhere, but in the important places. Now, if that’s what you’re aiming for, you also have to reflect that throughout the firm, and part of that is that you have a management of that nature.” With the consultation committee set to make its initial recommendations this spring, internationalisation is firmly on Freshfields’ agenda. It is likely that there are a few fireworks yet to come.
The co-senior partner is also remarkably candid on the issue of conflicts in Germany. Freshfields, because of the size and dominance of its corporate department in Germany, has historically taken a relatively liberal attitude to conflicts. Independent German firms, with Hengeler Mueller as standard-bearer, say they take a much tougher line.
Asked about the firm’s stance, Mettenheimer does something quite astonishing. He reaches across the table, picks up my tape recorder and says directly into it: “Yes, we’ve pushed, and yes it was a conscious decision. And it’s the right decision because it’s permitted; and not only that, Hengeler have done it themselves.” Probably no need to check that quote, then.
He explained that an auction where there were several similar bidders was the most likely instance of the firm acting for more than one party. “Market standard is that clients accept it,” he says. This is not necessarily true, but Mettenheimer deserves respect for putting his case. The last thing I ever expected was for a partner from Bruckhaus to speak up on an issue that UK firms – most notably Allen & Overy – have been dodging for 12 months.
The German partner is also very clear in his attitude to the US; the firm has not given up on a US merger yet. “We want to move along with the market,” he says. “We don’t want to jump into something where we’re not sure that we’re really doing the right thing. We want a merger rather than a greenfield development.” Keeping the US offices small and “digestible” is key for the moment.
By the end of the interview I rather like Mettenheimer. I chuckle rather than grimace when he rounds off by calling Freshfields a “happy family” without a hint of irony. I even let it pass when he asks me why I could not think of any more difficult questions for him. His PR advice may not be the best, but face-to-face, Mettenheimer is genuine and open – more so in fact than many of his London partners.
I still don’t expect him to return many phone calls, though.
Co-senior partner elect
Freshfields Bruckhaus Deringer