Breaking the £1m barrier
George Bull assesses the implications for the legal profession of the current surge in partner profits and salaries and asks whether they can be sustained in the future
This year, more partners will hit the seven-figure profit share benchmark than ever before, with additional high-rollers anticipated in 2001. The law attracts intelligent, inquiring, competitive – even pugilistic – practitioners who happily pit themselves against legislation, precedents, cases and competitors on a daily basis. It is not for the faint-hearted – the law of the jungle rules, and when the fittest survive in a globally competitive arena, they want the recognition and remuneration packages befitting Lion Kings. Success has become visible, with the best and brightest seeking affirmation of their position – with a million-pound slice of the profits the preferred perk. Being ‘the best’ in any profession, industry, sporting or artistic arena is a fundamental life-affirming achievement. Premier legal talent is a rare commodity in a profession previously known for personal reticence: there is a perennial scarcity of excellence across all disciplines, which means gifted individuals at the top of the profession can and should seek rewards in line with their contributions. Link these changes with the broad shift in UK society toward more conspicuous consumption and the million-pound partner seems inevitable – a natural outgrowth of changing times and individual expectations.The professions are becoming more businesslike, more commercially aware and more driven. Partner profits are vital to lock in the best talent and recruit superior young blood.Leading lawyers are no different to their counterparts in industry: they are at the peak of their career powers and they should be able to command commensurate earnings. Compared with the multi-faceted packages pulled in by leading manufacturers of baked beans (Tony O’Reilly), pop conglomerates (Richard Branson) and retailers (Sam Walton), remuneration in the UK legal profession is decidedly second or third division. How many leading lawyers have access to company flats and houses? To 24/7 chauffeur services? To multi-million pound share option schemes and incentive programmes? To pension plans which, to the average worker, seem like the riches of Croesus? The world is shrinking, while knowledge explodes. The two will converge and the tidal wave of million-pound partners will surge through the profession. Will the million-dollar law partner, like the million-dollar investment banker, become the norm?But can the meteoric rise in profit levels be maintained? Will this destroy the nature of UK partnerships? What are the effects on a partnership and on second- and third-generation partner development? How will law firms fund ever-increasing packages? Will all staff participate in the fiscal glory? Are there significant hidden costs involved in cosseting your Armani-clad staff?
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