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Why Brexit, technology and agile working are some of the ingredients shaking up City law

7th 01 2019

 

 Finance partner and co-head of graduate recruitment at Travers Smith Danny Peel explains how the City law firm is responding to change:

The below post was written by Elizabeth Davidson for Legal Cheek and can be found at: https://www.legalcheek.com/lc-careers-posts/why-brexit-technological-disruption-and-agile-working-are-some-of-the-ingredients-shaking-up-city-law/

A successful law firm is an agile one. Whether it’s the chaos of Brexit, rise of disruptive technologies, the downturn in emerging markets or fears that the current bull run will end soon… law firms must adapt to change. So, how do they do it?
 
As Danny Peel, finance partner at City law firm Travers Smith, explains, the fortunes of City law firms tend to track the economy. In times of plenty, there is lots of M&A work which, in turn, means work not only for the corporate teams but for the various specialist teams around the firm. In leaner times, transactional work can dry-up to a slow drip which means that firms need to look to other areas to generate business. Following the financial crisis ten years ago, Travers Smith looked to move away from a perhaps over-reliance on its corporate practice and sought to grow other parts of the business which are less sensitive to the peaks and troughs of the economy.
“We’ve looked to be better hedged and have focused on organic growth in some of our other practice areas,” says Peel.
 
Notably, the firm has doubled the size of its dispute resolution department — litigation tends to be less sensitive to the economic climate (and can actually increase in a downturn, as there is an even greater emphasis on protecting and preserving existing revenue streams when the business as a whole is contracting or stagnating).
It has also invested in its derivatives and structured products team which, alongside its own, stand-alone instructions, provides support to the firm’s highly-regarded pensions and financial services & markets teams. Like litigation, advisory mandates tend to provide a steadier flow of instructions than transactional work.
One of the biggest drivers of uncertainty at the moment is, of course, Brexit. In common with most major law firms, Travers Smith has established a dedicated Brexit working group to keep the firm and its clients up to speed on developments.
“As you might expect, both we and our clients are extremely focused on all things Brexit and are monitoring developments closely. The complications arising from a “no deal” scenario are wide-ranging and go to the very heart of many of our clients’ businesses — from their ability to trade with their European partners to the make-up of their workforce,” says Peel.
Some businesses which are looking to invest in the UK — such as those with significant non-sterling revenues or private equity houses which have raised funds in euros — may have benefited from the uncertainties caused by Brexit as the weakened pound has increased their spending power significantly. On the other hand, uncertainty can have a freezing effect. Peel gives as example: “In the months leading up to the Scottish independence referendum in 2014, inward investment into Scotland all but dried up because investors didn’t know what would happen.”
 
Technology is another driver of change. Travers Smith is trialling some AI (artificial intelligence) products, which its lawyers use for contract review and keyword searches. “It’s not the finished article yet,” Peel says. He continues:
“With most AI products, you have to teach them what to look for and that takes time and investment — but that will improve as the technology gets ever more sophisticated, so there’s definitely a future for it. Another useful development has been our document building software, which we have developed with an external provider. For finance lawyers like me, it might previously have taken several hours of intensive work to bring a 300-page loan agreement precedent to a point where you can start tailoring it to the transaction in question, but with this software the same process can be completed much more quickly. Technology has been transformative — sometimes saving hours of time, making life easier for our lawyers and helping keep our clients’ costs down.”
 
The arrival of agile working has also improved life at Travers Smith. The firm is a keen supporter, and its policy allows lawyers to work from anywhere. That’s not to say its smartly-appointed Farringdon premises now lie deserted — most people find it easier to work in the office surrounded by their books and files. A handful of people work remotely and are “formally on the books on that basis,” says Peel, including two full-time funds associates who live in Scotland and travel south for meetings when required (typically every two to three weeks). Others work at the firm on an ad hoc basis, including one real estate alumni who now lives in Dubai.
Peel hopes agile working will continue to improve the gender balance at the firm, where more than half of the trainees and associates are female but less than 25% of partners are female. He says:

“We have made great strides in diversity and inclusion, in particular gender balance, over the last five years or so but there is still plenty of work to be done. Agile working allows people to juggle work and family commitments and has proved invaluable — we have now got to a position where it is 100% accepted that people can leave early and log on from home which has made a massive difference to both men and women across the firm.”

Travers Smith, explains, the fortunes of City law firms tend to track the economy. In times of plenty, there is lots of M&A work which, in turn, means work not only for the corporate teams but for the various specialist teams around the firm. In leaner times, transactional work can dry-up to a slow drip which means that firms need to look to other areas to generate business. Following the financial crisis ten years ago, Travers Smith looked to move away from a perhaps over-reliance on its corporate practice and sought to grow other parts of the business which are less sensitive to the peaks and troughs of the economy.