MDPs offer the chance to diversify
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With accountants rapidly encroaching on our work, MDPs provide a way to bring them on board and become more business-oriented, says Brian Marson. Brian Marson is senior partner at Marsons.
AS LAWYERS around the globe react with glee to the challenge of multi-disciplinary partnerships (MDPs), a wealth of opportunities awaits UK law firms.
Solicitors in Australia are seizing the initiative in response to the large number of accountancy firms opening up legal practices Down Under. They say they want to "regain some of the market share lost to accountants over the past decade".
The days have gone when the legal profession would flatly refuse to even contemplate the thought of dirtying itself by working with accountants. But we have been engulfed by a tide of change. Across the world, and especially in Europe, the big accountancy firms are on a seemingly unstoppable march.
Spain's largest legal firm was taken over by Arthur Andersen last year. In the Netherlands, Belgium, Sweden, Italy, Canada, Australia, France, New Zealand, and many other countries, accountants are remorselessly building their legal practices. Last year, Arthur Andersen reportedly recruited more lawyers in the US than any single law firm. Figures published last year show that five of the 10 largest law firms in the world are now led by accountancy firms.
The new debate is not about how to stop them, but how to regulate them. Countries such as Australia, France and Canada have all but dropped their bans on MDPs. The New Zealand Commerce Commission is investigating whether the country's MDP ban is anti-competitive, while our own Office of Fair Trading has expressed considerable interest in MDPs and says it wants to see them happen.
The main argument against MDPs is that lawyers and auditors have conflicting duties with regard to confidentiality. Lawyers are obliged to keep client matters secret, while auditors have a duty to disclose any wrongdoing they discover.
The Law Society's consultation period on MDPs is due to end this month and the president, Michael Mathews, acknowledges there must be changes. However, we need to be able to compete. It will be of little use if the Law Society relaxes the ban but accompanies this with so many other rules that in practice MDPs become virtually impossible.
We can offer clients an ethical, professional business that stands apart from our competitors, and regulation is important to retain this distinctiveness. However, in today's climate of deregulation - both at the Law Society and globally - we should only adopt the minimum rules to maximise our competitiveness.
MDPs offer the chance to bring other expert professionals into our firms and keep them there by giving them a stake in the business. The key word is "entrepreneurialism", and the solicitor brand remains strong.
Clients should approach us for all their business needs, not just when they are in trouble. This gives practices crucial diversification and with an economic slowdown on the way, different income streams are vital.
We should also approach clients. It is sensible for an employment law practice to also offer non-legal services.
The legal profession is already doing this with some success. There is an old joke about the MDP between a probate lawyer and a funeral director - but why not? How many more times do we need to be told we live in a consumer culture?
The time has come for our profession to marry the demands of being both a profession and a business. The best way to ensure that MDPs meet the exacting standards of the legal profession is for solicitors to have a major say in their control.
The rewards could be immense. In any case, solicitors will be an integral part of all real MDPs. They need us, and we should take advantage of that.