The Leader Column

You wouldn’t think Anthony Cann or Tony Angel are a couple of Trotskyites, but given the permanent revolution at Linklaters, I’m having my doubts. Managing out dozens of partners and associates, that cash call last year, up to £30m spent on a new IT system, and perhaps most damaging for the old amour-propre, coming bottom of The Lawyer 100 magic circle profits table with £650,000 – which was also less than Herbert Smith and Macfarlanes.

For in the slightly unreal world of the magic circle, high profits equals intellectual credibility. When you’re used to leading the City pack and then find you’ve been outpaced by those oiks at Clifford Chance, that must hurt.

Whole swathes of Linklaters partners are entirely unnerved by this. I remember asking one partner about it last year. He paused, and said: “What did the management tell you?” I replied: “I’m not sure I understood their reasons.” To which he said waspishly: “You’re not the only one.”

Now, it may be that the management has done all the difficult things. It had to integrate a whole slew of European law firms into a worldwide partnership and is being tough on underperformance – two huge tasks that Freshfields, for example, has not yet had to face.

Yet it looks like Linklaters lawyers have lost a partnership but not yet found anything to replace it. Jim Wadia, the former Andersen chief, and corporate head David Cheyne are usually cast in the roles of the hawks. However, there’s an increasingly militant tendency in London who can only see Linklaters slipping further behind Allen & Overy, Freshfields and Clifford Chance – let alone the US firms against which the magic circle is now benchmarked. And all this at a firm that still dominates the M&A league tables.

Don’t underestimate the symbolism of corporate partner Peter King resigning. Unlike Tim Emmerson, who left Freshfields for the more intimate environs of Milbank Tweed in London, King is still a supporter of the global vision, or he wouldn’t have joined Shearman & Sterling. The fact that he was able to parachute in near the top of Shearman’s equity probably helped, but what should worry the management is that a leading corporate partner wanted to realise his ambitions at another global firm.

They’re a resilient lot, Linklaters partners, but there’s only so much they’re going to take. Cann and Angel had better deliver on profitability soon. After all, they’ve got to justify all that turmoil somehow.