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This year, The Lawyer’s annual ranking of the largest UK law firms by turnover is available as an interactive, digital benchmarking tool. For the first time this will allow you to manipulate each data set against the metrics of your choice.
Every summer, the entire reporting staff of The Lawyer turns into a bunch of geeks – and we love it. The Lawyer UK 100 Annual Report is the biggest statistical exercise in the legal profession bar none, and we spend weeks researching the figures. We talk to managing partners, equity partners, finance directors, bankers, accountants, headhunters, management consultants, heads of chambers and senior clerks. It’s bliss, alright.
The best bit – well, the nerdiest bit – is when we have all the figures in front of us. Then we actually revel in discovering that Firm A’s lock-up improved by 10 per cent despite its gigantic property practice, that Firm B’s profit rise was partly attributable to it shaving its cost per lawyer in Ljublijana, or that Firm C has cut its equity partnership in half over four years.
The result is the 132-page monster annual report arriving with your copy of The Lawyer today. Simply ranking law firm revenues and profits is easy. We don’t believe that you can assess law firms or chambers as businesses unless you dig deeper and understand the context in which they operate. We started this process last year with our pioneering study of financial management in the UK’s biggest law firms, when we also revealed for the first time how different firms stacked up on costs.
This year, whether you’re a partner, an assistant solicitor or a non-fee-earning professional, you’ll be able to see how your organisation is run. You’ll be able to see the profit margin, equity structure, salaried partner remuneration, costs, work in progress, debtor days, and billing targets for every single firm in the UK top 100, plus the top 30 international firms in London. And no doubt our 9,000 in-house lawyer readership will be very interested in seeing how the UK’s biggest firms make their money.
Transparency is a new thing for lawyers and their staff, and it’s timely. Already, increasing numbers of firms are opting to become limited liability partnerships with all the financial rigour that requires. After the Clementi review, they may even be able to attract outside capital.
For the moment there’s little appetite for this. As the report reveals, most practices carry out their growth plans without resorting to outside debt. But things change; 10 years ago, law firms didn’t even reveal turnover. Any potential investor is now going to want to see where the returns are. The Lawyer UK 100 Annual Report will help all of us know where we should put our money. Enjoy.