If partner promotions are a guide to firms’ investment in finance, what are the current prospects for assistants in the City?
Looking at some of the appointments this year (see table), you might think the outlook is wintry. Clifford Chance didn’t make a single banking partner in London this time round, while Freshfields Bruckhaus Deringer drew a blank on project finance. Freshfields, you might remember, had already telegraphed its decision a year previously through a mistakenly circulated email (revealed by The Lawyer, 23 June 2003), which said the business case for future project finance promotions was looking slim.
Yet finance assistants need not panic unduly. In the larger City firms, promotions have kept pace with corporate, while capital markets assistants fare rather well. Allen & Overy (A&O), Clifford Chance, Freshfields and Linklaters each made up three in capital markets, mostly spread around the global networks.
For the combined banking, projects and capital markets tally, Linklaters and A&O came first and second, with 11 and nine respectively. With both magic circle firms, the appointments were spread evenly across banking, capital markets and projects. In A&O’s case, there was also an interesting nod towards the borrower side of the finance business with the promotion of Ian Borman.
But for the moment it’s Linklaters – still playing catch-up with A&O and Clifford Chance on finance – that is making the biggest investment. Notably, Philip Spittall – part of that talented diaspora of former Wilde Sapte assistants who left just before the Dentons merger – got the call-up this year. Many thought he should have been made up the previous year, but it seems that a bottleneck at the senior assistant end prevented it. The only two London assistants to make it in 2003 were Simon Gwynne in asset finance and Andrew Jones in projects.
That same temporary glass ceiling may also have contributed to Chris Howard’s departure for Freshfields earlier this year. Howard – another former Wilde Sapte man – became Freshfields’ first ever associate to partner lateral in January this year, joining his old mate Brian Gray, who joined Freshfields from Wilde Sapte as an assistant four years ago and who made partner in 2002.
Bottleneck or not, Linklaters not only promoted internally this time round, but also made a lateral hire of note just a couple of months ago. The firm may have lost a strong contender in Howard, but it struck gold with the hire of rising Clifford Chance star Stephen Lucas in March.
Intriguingly, Howard and Lucas are considered to be energetic business-getters as well as strong lawyers. Both will be crucial to Freshfields’ and Linklaters’ push for more bank-side business; Lucas has worked with Citigroup and Goldman Sachs and Howard with Royal Bank of Scotland and HSBC. (Freshfields’ renewed push on finance following the McKinsey report no doubt helped the prospects of its three promoted lawyers – Chris Barratt in securitisation, Simon Johnson in acquisition finance and Richard Tett in restructuring.)
Internal promotions aside, what are the opportunities for assistants looking for partnership outside their firms? It’s patchy. CMS Cameron McKenna (project-finance dominated, with one new partner this year, Paul Smith, in that very area) tends to grow virtually all its partners organically. Even DLA, whose entire growth has been predicated on lateral hires, tends not to put senior assistants from magic circle firms immediately into the partnership.
However, recruiters say finance assistants are easy to place.
“They’re in a much stronger position to engineer a good move to another firm than corporate assistants are,” says Greg Abrahams of Abrahams Russell. “Several US firms are looking to hire senior assistants in leveraged finance and property finance.”
But joining the finance practice of a US firm has one major drawback.
First of all, hardly any of them promote straight into the partnership – Latham & Watkins and Shearman & Sterling may have made their initial growth in London through external partner hires, but now they groom their own lawyers for promotion. What’s more, it’s impossible to get anywhere near a credible US firm if you haven’t got a book of business. This means that with the increasing institutionalisation of bank relationships, assistants looking at careers with US firms may fall victim to the panel system.
If an assistant has spent years building up relationships with mid-level bankers, then the only option is to move to a firm that already has strong panel representation. Small wonder that Berwin Leighton Paisner (BLP) and Denton Wilde Sapte have done so well in picking lateral talent, with BLP’s property finance practice giving the firm massive inroads with banks such as RBS.
Dentons – which had yet to announce its internal promotions at the time of writing – has been an assiduous farmer of City talent. Since March 2003 it has hired no fewer than eight partners into the general finance and financial markets practice. Some, such as Michael Black and Jayesh Patel, formerly of Theodore Goddard, were partners with established track records, but the firm also hired three senior associates from Clifford Chance into the partnership: Sergious Sergiou, Ian Yeo and David Cohen.
Dentons banking head Howard Morris says his firm has capitalised on the feeling among many senior assistants that the equity prize is increasingly out of reach. “It’s increasingly hard for City assistants who are looking at spending longer at the salaried or junior equity level,” he says.
But the low number of women being promoted should give managers some cause for concern. It’s a well-known phenomenon that female lawyers start dropping out at around four years’ post-qualification experience, but this year’s promotions underline the view that finance is particularly tough for women.
The six firms in the table together promoted 34 assistants to partner. Only six of the new partners were women. Three were from Linklaters – Nicole Xanthopol and Caroline Miller-Smith in London, and Mary Moran in Tokyo. The other three – Kate McCarthy in Washington DC, Tanja Svetina in Milan and Frances Wong in Hong Hong – were from Clifford Chance.
Are there really equal opportunities for finance assistants? Is it a uniquely beery culture? All together now…
|Number of partner promotions (2004)|
|*Including banking, capital markets and project finance|