is set to unveil radical proposals which could see the firm become an all-equity partnership as part of its overhaul of the global lockstep.Clifford Chance is set to unveil radical proposals which could see the firm become an all-equity partnership as part of its overhaul of the global lockstep.
The lockstep review committee, led by real estate head Cliff McAuley, has drawn up a plan that will be put to a partnership vote in the autumn. The Lawyer understands that any proposed move to an all-equity partnership will be conditional on stretching the global lockstep.
The Clifford Chance ladder currently runs from 40 to 100 units. One partner at the firm told The Lawyer: “Instead of having salaried partners we would create more rungs before 40 points.
“We’re trying to have a global lockstep with enough flexibility to cope with mature markets, differentials within markets and investment in new markets. [The current system] limits our ability to grow.”
Under the plan, some jurisdictions may opt in to a lower ladder. That decision would be devolved to the local partnerships and not imposed centrally.
A source close to the process said: “There may also be a gateway at 100 units to an upper ladder.”
The lockstep review committee is currently taking soundings with European managing partners, the partnership board and key opinion-formers within the firm. The proposal will be unveiled to the partnership before the end of June.
The status of non-equity partners has been a thorny issue at the magic circle firm over the last couple of years. In August 2003, salaried partners convened a meeting with management to complain about the extension of the salaried partner term from two to three years. However, a year later the salaried partners won concessions from the management and got a simplified system for reaching equity.
At the end of the 2003-04 financial year, Clifford Chance had 626 partners worldwide, of whom 406 were equity.