Mishcon de Reya managing partner Kevin Gold is facing the firm’s biggest shake-up in a decade.
Last month the firm voted through its conversion to LLP status, which will see all of its 65 fixed-share partners brought into the equity. It is also on the brink of combining its four offices into one (8 June 2014).
But that office might be draughtier than expected because Gold has just told his lawyers they can work as many, or as few, days as they want. He’s also told them to take unlimited holidays.
There’s no doubt Gold has massive faith in his firm and its people, so much faith in fact that Mishcon has passed a new agile working programme allowing its lawyers to work anywhere they want and take unlimited holidays, as long as it doesn’t affect their clients. The change coincides with Mishcon’s preparations for a relocation next year into a single site at the Aldwych.
It’s a lot to handle simultaneously. How does Gold feel about all the upcoming moves?
“I’m s*tting myself,” he admits, laughing, but quickly adds: “It’s a lot to bring together but we’ve got a great team.”
“You’ve got two choices,” continues Gold, ”the amount of time you want to work and the amount of time you want to have off.”
Gold, Mishcon’s longstanding number one cheerleader, goes even further, adding when questioned that “of course, you can work a three-day week, that’s why we’re the best company to work for”.
“These are lifestyle choices and it’s about creating a flexible workforce that the organisation serves and that serves the organisation too. I thought I’d have big resistance from the board and the partnership but I had very easy take up,” he insists.
Many might not share his surprise at the scheme’s popularity which, he claims, stemmed from wanting to foster a better gender balance in the firm. Worried that the high number of female trainees and associates were not translating into a balanced partnership, the firm set out to make work more flexible for new mothers.
“More women than men are coming into the law and when women have a baby they take a break out of the profession and often feel it’s difficult to come back in,” says Gold. ”They might not be able to commit all their time in the office and I think people often feel a loss of confidence.
“It’s not very efficient if you want to talk about it in terms of investment but to put it in broader Mishcon terms, its not our way to let people feel uncomfortable.”
The firm is already making strides in increasing the number of women in its partnership, adding eight female partners during 2013/14. It now has 29 female partners out of 102 partners in total and six of its 37 equity partners are women.
Those numbers are about to change dramatically in other ways too (19 August 2014). In September the firm voted to convert to an LLP after decades as a general partnership. The move was motivated both by the need to bring Mishcon into line with new HM Revenue and Customs (HMRC) rules on LLP member taxation and partly by partners’ concerns over taking on a more onerous lease.
The 120,000 sq ft Africa House in Kingsway will cost around £3m more per year than the firm’s current offices. Until now Mishcon has been spread across four offices in Holborn at an annual cost of £4m.
“The timeline was really driven by the risk of taking a major lease, people didn’t want to take the joint and several liability. But then there was a strong bias which said we like being a partnership for maybe emotional reasons so we kind of resisted the change,” Gold says. “Then HMRC came up with the new regime so we put that all into the melting pot and decided not make this change into something forced upon us and to look at making some positive energy instead, so we voted.”
After becoming an LLP, all Mishcon partners will contribute capital and take a stake in the firm as junior or senior equity partners, eliminating the firm’s salaried partner band.
The change is likely to make a difference to the firm’s hefty average profit per equity partner (PEP) figure, which soared to £975,000 for the UK end of the firm (it has a separate LLP in New York and prefers to keep those numbers under its hat) during 2013/14, a 16 per cent increase on £840,000 at the 2012/13 year-end. However Gold said several junior partners were already on higher salaries than some equity partners due to a focus on merit-based pay.
“What’s difficult to see is certain emotional triggers that happen to people. If someone owns a percent of the firm, that can trigger an emotional reaction in them but other people might think another thousand quid is a better emotional reaction,” he adds, explaining some partners’ resistance to the idea of joining the equity.
“I come from an old school where I would be much more comfortable with a John Lewis way of life. I think if everyone has shares we’re better than if fewer people have shares,” he says, “But the Mishcon way is we will come up with a solution and if it doesn’t work we will fix it.”
In terms of the wider career progression of Mishcon’s lawyers, Gold claims he wants them to be “legal entrepreneurs”.
“We don’t have partners who are just good techies and not involved with the culture of our business,” he says.
As part of that, the firm developed the Mishcon Academy, which Gold hopes will one day be able to offer MBAs in conjunction with the top universities. The Academy, which launched last year, has four strands – learning and development, social impact, commercial connectivity and new thinking. In July deputy chairman Anthony Julius was named director, or dean, as Gold puts it.
All lawyers in the firm are asked to take parts and have to end the year with a certain number of points, accumulated through attending lectures on anything from civil rights to political or business issues.
Gold thinks most lawyers are really “frustrated academics” but says the next step will be to offer the programme, and maybe in the future an MBA, to clients of the firm.
“Everything in law is part of a narrow thing really so the idea is to get people thinking about the narrow and the big things, both in academically and intellectually and in terms of society.”
The Mishcon mentality appears to be working if the firm’s financials are anything to go by. In 2013/14 the firm turned over £97.8m in the UK, up 17 per cent on its 2012/13 turnover of £83.4m and almost hitting its 2016 target of £100m two years early (8 July 2014).
Litigation is the key driver of Mishcon’s success, counting for 34 per cent of revenue. However the firm’s strength lies in its ability to draw together its family law, offshore work and private client offering.
Gold is clearly happy about the firm’s results but says, “it must easier to institutionalise a multinational than to institutional big families and you need to feel you have a track record.
”This year is a replica plus of last year, so I’m feeling more comfortable but next year will be a different animal because we’ve got this big move where we’re consolidating. That will impact in the next year I would imagine but we’ve got the opportunity to grow again I think.”
Gold might be “sh**tting himself”, but ultimately he has faith in his firm to get the job done, no matter how many days they work.