The legal world has been transformed in the last year, and so has our seventh annual A-List. Only four firms held on to the same ranking that they had in 2008. Four firms fell off the list, which means another quartet joined this elite group. One constant, however, is the continuing reign of Munger, Tolles & Olson, which remains our top firm for the second year in a row. The Los Angeles-based firm beat the two second-best firms, Hughes Hubbard & Reed and Latham & Watkins, by a comfortable margin of 34 points.
This list, which we launched in 2003, aims to measure and quantify the qualities that define an elite law firm, making an effort to look beyond profits. We examine four factors: revenue per lawyer, commitment to pro bono, diversity among lawyers, and associate training and satisfaction. Our formula gives more weight to the first two factors; we double a firm's scores for revenue per lawyer and pro bono, and then add scores for diversity and associate satisfaction.
This year's top 20 rankings might be seen as further evidence that these are hard times for New York-based firms. All the firms that fell off are based in Manhattan; those that replaced them are headquartered elsewhere.
Two firms made our A-List for the first time: Irell & Manella and Kirkland & Ellis. The two that reappear on the list -- Wilmer Cutler Pickering Hale and Dorr and Howrey -- are veterans of past lists.
The New York firms that fell off are Patterson Belknap Webb & Tyler (ranked third last year), Shearman & Sterling (ranked 13th before), Cravath, Swaine & Moore, and Simpson Thacher & Bartlett (both ranked 14th in 2008). (We also consider Shearman to be an international firm. While Shearman's New York office is its biggest, more than 40 percent of the firm's lawyers are abroad.)
At the top firm, Munger Tolles, the qualities we measure are ingrained in their culture, as we detailed in last year's profile of the firm ["A Firm of Equals," July 2008]. Munger isn't highly leveraged with associates, which tends to make for more satisfied young lawyers. The firm also maintains a strong cultural commitment to pro bono. "We want to give back to the community, and we think it makes for better lawyers," says Mark Helm, one of Munger's co-managing partners. He notes that about a year ago, management noticed a dip in pro bono activity and made a push to bring it back up. The California firm also cares about diversity. (Minorities make up 22 percent of its lawyers and 15 percent of its partners.) "We have made a strategic decision to look more systematically at diversity," says Helm. As an example, Munger runs a "diversity-based" summer program for first-year law students that has led to associate jobs for two lawyers. The firm last year also hired a diversity consultant to suggest ways that it could improve in this area, and devoted a day of its annual retreat to diversity discussions. "We didn't feel we were doing enough," says co-managing partner Sandra Seville-Jones. "We've done a good job, but there is so much more. We want to take it to another level." One thing the consultant suggested was formalizing the firm's associate review process, to make sure that the same standards were applied to everyone.