Partner hiring: this is the ONE thing that firms can change

As lateral partner recruiters, we are frequently asked whether we are witnessing or envisaging a ‘dip’ in partner hiring. To the contrary. We are actually seeing the effect of the record-breaking year of PE-led M&A deals in 2021 and of financial firepower gained in the past couple of productive years, leading to a confidence in continuing to make lateral hires and a realisation that growth must also come from lateral hires and not just internal promotions.

This year, the London market has seen a significant increase in partner moves compared to the last five years, with US law firms leading the way. The lure of top of the market remuneration and the dominance of the US headquartered firms is evident. In addition, it is clear that firms are thinking ahead and strategically positioning their teams for what is to come as a result of an uncertain economy – bolstering restructuring and litigation teams.

What we are now seeing is a ‘candidate’s market’ which means hiring firms continue to face competitive times ahead. The growth of equity partnership invitations indicates that law firms are responding and preparing their structures in order to retain talent. This has put a risk-taking element of pressure on hiring law firms to not only present attractive remuneration packages for incoming partners but also, to be more open and willing to welcome partners into their equity family from day one. Firms are tussling with this due to them having to assess the effect on the sharing of profit amongst their existing partnership. However, law firms are businesses and future risk is a normal part of any hire. Recruiters can alleviate that risk by assisting with the due diligence process and moreover, by working with candidates and clients to ensure that all parties are on the same page.

Whilst presenting information to partners is a necessity, there is one element that remains within a firm’s power during a process: to make the partner feel wanted. Clearly a process may not end with the firm wanting to offer a partner, but in these competitive times, having the ability to retain this decision is crucial. Too many times, processes have fallen down because there is a lack of continuity. Feedback is not collated or relayed with any urgency, often allowing another firm to swoop in and envelop the partner. The move to video interviews has helped with efficiency in part, when logistics can prove tricky in getting the relevant people together in a room. But it’s worth firms remembering that everything they do through a process comes through in how the partner feels as a result. Even if a process doesn’t end in the partner joining, if they’re left with a positive feeling then it could lead to the door being open in the future, or maybe they have good things to say about the firm if a colleague asks them about that firm or even passing on a piece of conflict work. Time delays can result in a loss of momentum that is difficult to recover from, particularly when alternative firms are attempting to lure in the same candidate and partners can directly compare a firm’s actions.

Preparation is key. Clear interview stages and time frames will counteract any potential inertia. Build in time for feedback at the end of the meeting so that this can be passed back. Consider alternative stages if the key people aren’t available due to other work pressures. As headhunters, we appreciate that the majority of partners are not “actively in the market” and have less reason to leave due to the aforementioned adaptation of their own firms to hold on to their people. This means that processes with new firms tend to begin informally and once there is an attraction from both sides, the demand to complete a hire can turn quickly too, from an informal to a quicker process. It is in firm’s interests to not be the party holding up discussions.