Magic circle firms must innovate to adapt to a permanently changed legal market, Sandie Okoro, general counsel at asset management firm Baring Asset Management, has warned.
‘Some magic circle firms are adapting more slowly than others, and the gap between the two is widening rather than closing,’ Okoro told the Gazette, giving her personal views.
While magic circle firms will always have their place, they need to adapt to the market realities of a decreasing number of big corporate deals, she explained.
‘My guess is that they will not only need to be able to identify how they can better use their skill-sets to help their clients’ businesses succeed, but also how they can [extend] their tremendous legal brands in innovative ways.
‘The big accountancy firms have been terrific at this, and are now known as much for their consultancy skills as their accountancy skills.’
Pressure to keep legal spend low will remain even as the economy picks up, she predicted. ‘Law firms may need to think about their pricing models, and if these will be fit for purpose in the coming decades,’ Okoro said. Automatic annual rises in charge-out rates will continue to be challenged, she added.
‘The in-house community really is a community, and we do talk to each other – so we know when a law firm is trying to pull a fast one as far as fees are concerned,’ she said.
‘Recently a law firm was very upfront in saying that it had given a very similar piece of advice to a number of clients, so it would give it to us at a very much discounted rate. This is the kind of “fee” talk I like to hear.’
Keeping on top of changes to law and regulation will continue to be a top priority for general counsel, Okoro added.
‘I think we will be expected to do more with less, and we will expect the same from our law firms,’ she warned.