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Laurence Simons newsletter July 2014

Posted by: Laurence Simons 25/07/14

Lawyer Under Fire

If a career in banking law prepares you for anything, it's facing ghouls and other terrifying spectres with a degree of equanimity. This has been underlined by former Simmons & Simmons corporate lawyer Holly Boyd, who recently secured a sought-after job as night watchman at a reputedly haunted theatre.

Over 500 people applied for the role, showing that people who live in London will do anything just to feel some kind of emotion other than mild irritation at another delay on the underground.

The makers of Ghost Stories, which is currently playing in the West End, hired Boyd as something of a publicity stunt for their latest show.

This follows some spooky, entirely above-board goings-on when a camera in the auditorium, “the scream-cam”, turned itself on and took photos overnight as well as recording a seat flapping up and down, which sounds terrifying.

Admittedly, a poltergeist that enjoys photography and sitting is unlikely to prove much of a threat to the general public, but Ms Boyd has nevertheless stepped into the breach to keep an eye on the theatre.

She told the Evening Standard she knew it was the job for her as soon as she'd seen the advertisement.

The corporate lawyer appears to be something of an adrenaline junkie (apart from the fact that she's got an incredibly boring career, obviously) - in the past Ms Boyd has trekked in a storm in Australia, jumped out of a plane and swum with sharks, although obviously corporate finance is great training for the latter activity.

"I think the world would be a much more interesting place if the paranormal were indeed true," she burbled.

"Holly’s fascination with the paranormal, bravery and sense of humour made her the perfect candidate," added Ghost Stories writer Andy Nyman.

One just hopes she doesn't see anything disappear, because a career in legal finance won't have prepared her for that kind of transparency...


UK law firm gap increasing?

The British legal market appears to be developing much like the society in which it's based (as well as that society's football league) - the rich are getting richer, while the mid-tier languish in mediocrity and the rest struggle to keep their chin out of the water.

Deloitte recently highlighted the issues affecting the private practice sector, noting that overall revenue for the top 100 law firms grew two per cent year on year in the last quarter of the 2013-14 financial year.

But over the last six years the top ten firms have far outshone their counterparts in terms of revenue, reports the Financial Times.

These companies generated growth of 18 per cent during this period, which encompasses several years of the financial crisis following the banking crash of 2008.

Comparatively, firms ranked 26 to 50 by revenue achieved only a one per cent growth rate over the same six-year period.

The organisations below this fared even worse. In many cases, their growth levels have not returned to pre-recessionary levels.

Jeremy Black, a Deloitte partner who advises law firms, suggested that big firms have been undercutting their smaller counterparts on fees, deigning to do work they might have previously ignored as they attempt to hoover up as much business as possible.

"This has made the mid-market even more crowded," he added. While the economic improvement recorded recently might ease conditions as business levels increase, it's difficult to see smaller firms outstripping their bigger rivals from a standing start.

Furthermore, many firms have been decisive when it comes to scaling back unproductive departments, meaning that fees-per-lawyer figures are looking good - especially at top-level international firms, where this kind of ruthlessness is necessary.

Many pundits (that is, men in expensive shoes enjoying their second Chablis at Gordon's Wine Bar) would argue that it's a dog eat dog world and larger firms are inevitably going to out-perform their mid-tier rivals in the current economic conditions. Others will point out that lawyers are going to be replaced by robots in the next decade so it doesn't matter, anyway.


Businesses 'demand more of their GCs'

In-house legal teams are increasingly being asked to fulfil more roles within their organisation, according to a new report from KPMG.

On the bright side, the majority of these roles are related to regulation and legal matters - general counsel aren't being asked to clean office windows. Nevertheless, it does mean that in-house jobs are becoming increasingly challenging (and prestigious).

Malcolm Marshall, global head of cyber security at KPMG, said: "In the last five years we've seen cybersecurity move from the back room to the boardroom and in extreme cases the court room. 

"Against this sort of backdrop, few people will be surprised to see it come in as the fastest-growing risk for general counsel and that’s why in-house legal teams should have a seat at the table, providing advice about the policies and vigilance required to tackle cyber risks for business."

KPMG interviewed six leading in-house lawyers to put its report together, with the web and online security once again a leading issue cited by respondents.

However, GCs are also being asked to examine other areas - due diligence is now a major part of their role, as businesses attempt to stamp out any kind of corruption across their supply chain in order to reduce risk exposure.

The main thrust of the report is that, where once lawyers might have only been involved at one point in a process, they are now being consulted for advice all the way down the line as businesses become extremely cautious.

David Eastwood, global head of contract compliance at KPMG, described this as an opportunity for business-savvy lawyers.

"Companies are becoming more complex and they are facing a more diverse set of risks. As a result, any executive who can master these intricacies while managing the risk will likely see their star rise," he added.

Those GCs who are not overwhelmed by the new set of demands being placed on them could make the boardroom in the future, even taking up a leadership position as more firms look to legal expertise as a key driver of success.

With the regulatory environment unlikely to get any less complex in the coming years, in-house lawyers should take the bull by the horns.

KPMG's report concluded by suggesting that business expertise and numeracy are becoming the most important drivers of success when it comes to internal legal functions.


FT names innovative lawyers in Asia-Pacific

The Financial Times has named the winners of the inaugural FT Asia-Pacific Innovative Lawyers programme, a competition launched in recognition of the region's increasing importance to the legal landscape across the globe.

A similar event is already organised in the US and Europe by the newspaper.

According to it, the awards are based on expert analysis, market surveys and hundreds of interviews with legal professionals, as well as a top-secret process involving a dartboard and a blindfold.

David Pilling, Asia managing editor of the FT, said he was delighted to recognise good performances in one of the most dynamic legal regions in the world.

"As the region's business practices change to adapt to a shifting landscape, the role of lawyers and legal frameworks must equally evolve. This report celebrates the best of these strategies," he added.

The awards are set up in a similar way to their predecessors in Europe and the States, which in a nutshell means there are far too many categories involved for me to tell you about all of them - I assume you're reading this on a computer with internet access and can easily look it up.

Anyway, Tencent was named the most innovative in-house legal team.

South Africa 'most business-friendly place on continent'



Companies and law firms planning to invest in the African continent over the coming years are likely to look to South Africa, Morocco and Tunisia, according to the Economist’s Intelligence Unit and its recently-released Business Environment Rankings.

This much-vaunted report attempts to take into account the years up until 2018, so these three countries will be pleased with the confidence boost - as will lawyers with bases in these countries hoping to gain a foothold in the African market.

The Economist's study is designed to reflect the main criteria used by companies to formulate their global business strategies and considered fairly accurate - although, of course, such predictions can always be thrown off-kilter by unexpected events.

On a global basis, Singapore, Switzerland and Hong Kong were the top performers, reports Business Tech.

According to the magazine, other African countries are currently being held back by political conditions despite their natural resources and potential for rapid economic growth.

"Two other Sub-Saharan countries - Kenya and Nigeria - also rank at the lower end of our rankings, held back by the ongoing problems of corruption, weak infrastructure, deteriorating security and, in the case of Nigeria, the absence of effective government institutions," said the report.

Even South Africa dropped back slightly compared to its performance last year, perhaps because European countries have regained their spots as the continent's economy shows welcome signs of stability.

With Europe's market relatively stagnant and the Asian market beginning to slow down, international legal service providers have been casting their eyes at Africa in recent years, particularly as external investment in parts of the continent increases.

However, many countries remain difficult for establishing legal offices, either because of ongoing social issues or due to a lack of liberalisation in the market.

Champagne lawyers win legal battle



Champagne and cigarette papers - it might sound like the new solo album from Johnny Borrell, but it's actually the latest legal clash from Champagne trade body CIVC.

Decanter magazine reports that the trigger-happy organisation clamped down on Royal Distribution Tabac Distri Nord, which was selling rolling papers under the name Crystal Champs and accompanying them with the image of a Champagne glass.

In what must be the Frenchest legal case of all time, the Lille Tribunal de Grande Instance accepted that there were potential commercial damages from the misuse of the symbol and awarded damages, although the exact sums involved were not reported.

As anyone who's ever been cornered by a boring oenophile at a dinner party is likely to know, the CIVC is extremely keen to prevent people from describing any old fizzy wine as Champagne - this should only refer to alcohol produced with grapes from the specific region of Champagne.

Fanny Hennequin, of the legal service of INAO, told Decanter that these cases are not unusual domestically as well as taking place quite often overseas.

"Breaches of protected designations of origin are far from limited just to foreign companies. We have perhaps 12 ongoing cases around all French appellations," she explained. And I think we can all raise a glass of fizzy, white, sweet beverage to that!