Hello and welcome to the Fides Weekly Update. Take a look at this week’s key trends, moves and developments in legal and compliance.
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1) Who runs the world…GIRLS!
With Theresa May becoming the UK’s second female Prime Minister and Liz Truss the first ever female Lord Chancellor, the political scene has shifted significantly from a gender perspective this week. Politics aside, gender equality was big on the agenda in the Fides office this week as we hosted our first roundtable discussion on the subject of building inclusive legal teams. For more information on the debate, or to be added to our mailing list to hear about similar events in our Path to Parity series please contact email@example.com
The issue of gender and the representation of women in the higher echelons of law also caused ripples across the Atlantic this week, as news emerged that Faiza Saeed was elected as presiding partner at Cravath, Swaine & Moore – the first female leader of any Wall Street firm.
The current co-head of M&A, Saeed was the consensus choice among the firm’s 89 partners and will assume her position in January whilst continuing to practice. With joint Pakistani-American heritage Saeed will also become one of only a handful of Asian-Americans ever to lead an Am Law 100 firm, a major diversity milestone in its own right.
With gender parity at entry level into law firms in the US and UK, the underrepresentation of women in partnership and positions of senior management continues. Whilst 34% of partners in large American law firms are women, they only make up 18% of equity partners and 8% of employees earning more than half-a-million dollars. In the UK, women still only account for 17% of full equity partners in top 10 firms and 16% in top 11-25 firms, figures that have remained consistent over the past few years. This suggests that the impending launch of gender pay gap reporting will reflect poorly on law firms when introduced next year.
Despite this, evidence suggests that firms are making concentrated efforts to improve the talent pipeline for women and increase the number of female role models within their firms. Last week CMS became the latest firm to pilot a work allocation system for associates in its corporate department, following schemes introduced by Ashurst and Hogan Lovells last year. The distribution of work through a dedicated resource manager helps to eliminate unconscious bias associated with receiving work directly from partners, and ensures that associates experience a wider variety of work as their career progresses.
In the US, data from the AML’s Women in Leadership Survey also found that despite low partnership numbers, 23% or one in four female partners are members of key governing committees, including key decision-making bodies such as compensation and partner promotion committees. With women only making up 18% of equity partners, this means that a female equity partner is significantly more likely to sit on a key governing committee than her male counterparts, both increasing the number of female lawyers in leadership positions and creating female role models for the future.
Whilst a major milestone has been reached with the election of Faiza Saeed as presiding partner at Cravath, the path to gender parity in law is a long and complicated one. Saeed’s election demonstrates that women can succeed at the highest levels in law and provides hope for the future that greater numbers of female lawyers progress now that firms are more actively engaged in the issue.
2) Deutsche Börse / LSE merger
In February it was announced that the German stock exchange Deutsche Börse and London Stock Exchange (LSE) were in merger talks in a deal worth £27billion, creating the world’s biggest exchange operator by revenue and the second largest by market value. It will also be viewed as a much needed European powerhouse to rival exchanges in Asia and the U.S. This merger is indicative of the current exchange sector which in recent years has seen a decline in their number, as firms have merged to ensure they can compete globally, moving away from the traditional “specialist” model to a broader inclusive platform.
The potential merger has been met with various roadblocks, particularly since the UK voted to leave the EU last month. Germany and France have questioned the arrangement which would result in the business being located in London and effectively outside of the EU. This has raised concerns that a euro clearing house should be based in Frankfurt and within the EU, rather than in the UK, despite Britain’s victory in the courts last year to protect its right to clear euro trades.
Shareholders remain divided, and whilst LSE shareholders are still approving of the deal, some German investors have become skeptical, calling for a re-evaluation of the plans. Deutsche Börse decided this week that it would lower the threshold for the number of shareholders needed to approve the deal from 75 per cent to 60 per cent. 53 per cent of investors have tendered their shares so far.
Although there are concerns with the exchange being held in a non-EU country, coupled with the new political climate, many are offering a positive spin on the merger. The new exchange could provide a much-needed bridge between Britain and the EU, highlighting the importance of keeping a solid relationship, mutually beneficial to both economies. As Andreas Dombert who sits on the Bundesbanks executive board commented “The parties’ concerned need to find a governance structure which balances all reasonable interests – even at the expense of synergies”
Should the merger still go ahead, where Deutsche Börse/LSE are headquartered should be a tell-tale sign of things to come. There are a number of broader financial services firms considering a shift from London to main land Europe, mainly due to passporting issues should the UK not secure favourable terms and access to the single market. However, as with most issues concerning Brexit, we can only speculate until we have a clearer picture of the deal to be struck with the UK and the rest of the EU.
MOVERS & SHAKERS OF THE WEEK
Visa Europe appoints new deputy GC
Visa Europe have appointed Prini Pithouse as deputy general counsel after starting in the company in May 2015
Barclays appoints GC for its corporate and international arm
Mark Shelton has moved from his role of legal head for the investment banking and Americas to GC of Barclays Corporate & International (BC&I)
Freshfields Bruckhaus Deringer appoints new regional managing partners for its European offices
Berlin competition partner Helmut Bergmann has taken up the role of regional managing partner for Germany, Austria, and central and Eastern Europe, whilst Paris corporate partner Alan Mason takes on the newly created role of managing partner for the rest of continental Europe
Ashurst exits continue as City restructuring partner joins Reed Smith
Ashurst has lost another partner in London with restructuring and insolvency expert Diane Roberts joining Reed Smith.
Sidley Austin Continues London Expansion with Leveraged Finance Partner
James Crooks has joined Sidley Austin LLP as a partner and member of its Global Finance practice in London.
White & Case expands Global Banking Practice with new partner in London
Jeffrey Rubinoff joins the Global Banking Practice of White & Case
Former KWM European finance chief to join Cadwalader in London
King & Wood Mallesons exits continue with former finance head Jeremy Cross joining Cadwalader, Wickersham & Taft LLP
KWM litigation partner follows ex-head to Covington & Burling
King & Wood Mallesons litigation partner Greg Lascelles is to follow his former practice head to US firm Covington & Burling.
Latham & Watkins makes second Ashurst hire this month
Leading Restructuring and Insolvency partner Simon Baskerville joins Latham’s London office
Senior Prosecutor from the UK’s Serious Fraud Office to Join Latham’s in London
Stuart Alford QC set to join Latham & Watkins as a partner in the Litigation and Tax department
Latham’s builds Real Estate Finance Practice
Jeremy Trinder and Quentin Gwyer have joined the firm’s London office as a partners in the Finance Department.
DWF enhances commercial litigation offering in London with team hire from PwC
DWF has appointed partner Jonathan Isaacs, senior associate Joshua Fineman and solicitor Alex Green to build on the firm’s commercial litigation offering in London.
K&L Gates welcomes London finance partner from Mayer Brown
Mayank Gupta has joined the firm as a partner in the firm’s global finance practice.
Osborne Clarke Netherlands bolsters team with four new hires
OC makes four additional hires in the Netherlands, including Johannes de Jong joins as Head of the Amsterdam Financial Regulatory practice
Hogan Lovells hires corporate tax partner
Elliot Weston joins Hogan Lovells from Gowling WLG
Office Openings and Closings
K&L Gates opens Munich office with hire of KWM team
Shoosmiths to launch Leeds office with Gordons partners
Clyde & Co opens first German office with team hire from Noerr