Law Firms to Sharpen Business Skills
Byline: Janine Brewis
Law firms fail to make the most of their relationships with investment banks to win new mandates and should teach junior staff better business skills to help them garner work, says a US consultancy.Poor service by law firms is jeopardising their relationships with banks, which are becoming tougher about the legal help they hire, according to a report by BTI Consulting Group. This is despite the prestige attached to advising investment banks because of the high fees they pay and business they provide.
Michael Rynowecer, president of BTI Consulting, says lawyers must be more aware of the implications and potential upside of working with banks. While an initial relationship may be with a bank's general counsel, if properly handled it could blossom into a broader one that includes advising on M&A work. "Many law firms do not really appreciate the level of opportunities open to them," Rynowecer says.
The report is based on interviews with more than 60 corporate lawyers at 21 investment banks globally. It reveals that more than half of banks have recruited new legal advisers in the past year, and 89.5% of respondents said they would consider dropping the law firms to which they were traditionally closest. This is a worrying trend for law firms, which have already complained that banks are forcing them to accept lower fees for corporate finance work. …