International firms in Asia Pacific are still struggling with low local fee rates, research from The Lawyer’s Asia Pacific 150 2016 report shows.
The average revenue brought in by lawyers at global firms in places such as China, Singapore and Australia is lagging dramatically behind those firms’ global averages.
The gap in revenue per lawyer (RPL) demonstrates the challenge for firms to achieve top-line growth in the Asia Pacific region.
However, regional and global revenue per partner (RPP) figures are more comparable. In some cases, partners in the Asia Pacific region even outperform their global peers.
Among the firms that provided regional turnover information, Clifford Chance had the highest revenue per lawyer (RPL) in 2015, at $697,000 per lawyer in Asia Pacific. But that figure is 15 per cent lower than the global average of $802,000.
Hogan Lovells has the second highest RPL in the region, $531,000 – 21.6 per cent lower than its global average of $678,000 per lawyer.
Per partner, Clifford Chance brought in $3.2m in Asia Pacific last year, slightly less than the global average of $3.5m.
Hogan Lovell’s Asia Pacific practice actually outperformed the rest of the firm in 2015. Its regional revenue per partner figure was $2.1m, almost 13 per cent higher than global RPP of $1.8m.
Similarly, Baker & McKenzie, DLA Piper, Reed Smith and Watson Farley & Williams also reported higher than global-average revenue per partner (RPP) figures in Asia-Pacific last year.
The firm with the biggest disparity between global and regional average is Withers KhattarWong. Withers entered into a formal law alliance (FLA) with Singaporean firm KhattarWong last year, boosting its regional headcount significantly. However, the rapid expansion diluted the firm’s average figures. Last year, average RPL of Withers’ Asia offices was $138,000, compared with a global RPL of $552,000. Average RPP in Asia was $402,000, less than half its global average of $1.39m.
Withers regional senior partner Sharon Ser told The Lawyer the firm’s priority is to integrate teams and client development among its newly expanded teams and regional capabilities. It also aims for continued growth of its international private client, tax and corporate practice across Asia Pacific.
The Lawyer Asia Pacific 150 is an annual ranking and analysis of the top 100 independent firms and top 50 international firms by lawyer headcount and regional revenue.
The research provides a rare glimpse into the most sensitive issues among international firms conducting business in the region.
Baker & McKenzie is the highest grossing international firm, but the research shows its revenue in Asia Pacific has been on a downward turn over the past two years. DLA Piper is the second largest international firm in the region by revenue, followed by Clifford Chance.
For most global firms in the region, the Asia Pacific contribution to their global revenues is still relatively small, typically less than 10 per cent. Although none of these firms’ managing partners would outline their financial targets for the region, all said Asia Pacific remains an important region for their firms and is ripe for investment.
For more details on the top 50 international firms in Asia pacific, order your copy of the Asia Pacific 150 2016 report. Contact Richard Edwards on 0207 970 4672 or at firstname.lastname@example.org