Hughes Hubbard & Reed chair Candace Beinecke doesn’t believe in “silver bullets” when it comes to managing a law firm. After years of steadily climbing up the ranks, her New York-based firm grabbed the number one spot on our 2011 A-List. But Beinecke says management focus isn’t responsible for that success. Quite the opposite. “Our strategy has been to stick to what we know, grow but grow smart, and focus on clients, not on firm management,” she says.
That approach sets Hughes Hubbard apart in an age of blockbuster mergers, massive lateral acquisitions, and the ascension of full-time law firm managers. The 300-lawyer firm has roughly the same head count as a decade ago and only one more office. (Hughes opened its seventh office in Jersey City in 2003.) Hughes hasn’t adopted grand new diversity initiatives, implemented new pro bono requirements, or made massive changes to its associates program. Instead, Beinecke and her partners have made steady and small tweaks to the 123-year-old firm. The results have been impressive in their consistency, with Hughes Hubbard increasing its total A-List score every year since 2005.
Nowhere is the success of Hughes Hubbard’s steady approach more evident than the firm’s significant increases in revenue per lawyer. Hughes Hubbard’s RPL increased 19 percent in 2010, resulting in an RPL score that is 25 percent higher than its score five years ago and 41 percent higher than its score on the first A-List survey in 2003. And yet Hughes Hubbard has studiously avoided expansion through big mergers or lateral acquisitions, events that could deflect time and energy away from clients toward integration.
Instead, Hughes Hubbard prefers small lateral acquisitions that bolster already successful practice areas. Take the firm’s recent expansion of its restructuring and banking practice. Going into the financial crisis, Hughes Hubbard had a reputable practice, led by James Giddens, a bankruptcy veteran who was named as trustee in the liquidation of Lehman’s brokerage business in September 2008. That same month, Hughes Hubbard acquired bankruptcy boutique Luskin, Stern & Eisler, adding three partners. Over the next year, the firm also lured Gibson, Dunn & Crutcher bankruptcy partner Kathryn Coleman and Lovells litigation partner Marc Henry. These timely additions brought in more than 50 active matters representing financial institutions, such as Société Générale S.A. and Citigroup Inc., in connection with the financial crisis. As the economic tide has shifted, several of these new relationships with financial institutions have led to loan and securities transactions work, says Beinecke.
Similarly, the firm’s knack for picking the right-sized opportunities has helped boost its pro bono score by 8 percent since 2005, to a near-perfect score of 199 this year. In recent years, the firm has turned its focus to complex and larger-scale pro bono matters, such as representing a group of immigrant women in a federal class action that challenged the failure of city and state agencies to provide public benefits to eligible immigrants. The success of that action, which settled in 2007 and has cost Hughes Hubbard close to 8,000 hours to date, whet the firm’s appetite for larger matters, says Beinecke. More recently, Hughes Hubbard represented 40 low-income tenants in a housing court action against the landlord of a Bronx building with more than 600 housing code violations, a project that required close to 1,500 attorney hours in 2010 alone. These larger projects haven’t been revolutionary. Hughes Hubbard has long asked attorneys to complete at least 50 hours of pro bono service. But they made a difference in results. This year, the firm reported an average of 143 pro bono hours per lawyer, the third-highest average in The Am Law 200.
Fine-tuning diversity efforts has also proved rewarding. Hughes Hubbard has an extensive history of championing diversity, hiring its first female associate in 1942 and making its first African American female partner, Amalya Kearse, in 1969. (Kearse went on to become the second African American to sit on the U.S. Court of Appeals for the Second Circuit.)
A few years ago Hughes Hubbard also began a two-stage approach to formal mentoring. The firm assigns mentors at two points in a lawyer’s career. In their first year, associates receive three mentors: a junior associate, a senior associate, and a partner. In their fifth year, associates select a new mentor, an individual who they feel would be most helpful and beneficial in advancing their careers. This program has helped boost the firm’s already high diversity hiring and retention rates. Seventy-three percent of the firm’s 2010 incoming class were diversity candidates, and 11 percent of the U.S.–based partners are minorities.
Those improvements in mentoring have helped boost asso­ciate satisfaction as well, with Hughes Hubbard’s midlevel satisfaction score representing a 9 percent increase from the 2010 A-List and an 18 percent increase from 2008. Over the last three years the firm has encouraged broader associate participation by initiating a slew of committees, including a technology committee that ad­vises management on the best ways to implement new technology, and an efficiency task force. Beinecke sees such committees as one of the best ways to improve client service over the long run. “Good ideas bubble up from the bottom,” she says.