fivehundred magazine > Law firm management > Competing against the best in the US

Competing against the best in the US

With consistent tier 1 status in The Legal 500 rankings within the areas of finance, REITs, and tax in the US guide, and banking, M&A, and projects in the Latin America guide, Helen Donegan, US editor (content) at The Legal 500, recently sat down with Evan Cohen to take a closer look at the strategy behind the growing success of Clifford Chance’s US team

When you’re asked to lead a region identified as the top strategic priority for one of the world’s largest globally integrated firms, you are faced with two distinct but intertwined challenges: supporting your firm’s global ambitions while also developing a domestic strategy that addresses the challenges unique to your local market. It’s no easy task.

But Evan Cohen – who was elected Clifford Chance’s managing partner for the Americas in 2013 – has likely exceeded the firm’s expectations based on the increasingly impressive results his US team has produced in recent years.

Initially, not many in the market took notice. But that’s beginning to change.

“In my view, we’re not a Magic Circle firm in the US; we’re a strong US firm comprised of US lawyers competing against US firms for domestic work”

The five pillars and the right market

Clifford Chance’s global strategy has five pillars: right markets, right work, right clients, best team, and best delivery. ‘Right markets’ is where Cohen places the US practice.

‘The firm’s overall vision is to grow the US and to grow Asia,’ he explains. With the aim of being ‘the global law firm of choice,’ Cohen goes on to highlight the importance of the US legal market. ‘To be a global leader, we needed to be more significant in the US. We recently surpassed 300 lawyers, we’ve developed several leading practices, and we like the trajectory we’re on.’

But growth is just a small piece of this story. Cohen and his team developed a strategy that was rolled out early in his tenure and it’s been paying huge dividends. ‘That strategy is run here locally, with the support of the global management committee. They have left us to get on with it.’

The right work

When asked what his US strategy entails, Cohen sums it up by saying: ‘It sounds simple, but you have to play where you can win – especially in a legal market as fiercely competitive as the US.’ And that’s exactly what he has done.

After six years with Clifford Chance in Hong Kong, Cohen moved back to New York in 2004 and took over the banking and finance group in 2005. ‘At that point, we had already done the merger with Rogers & Wells and we were still integrating the two practices,’ he confirms. Cohen quickly identified the challenges and decided that focusing on the right areas of work – and selecting where he believed the firm could build market-leading practices – was the best way to address it. This would prove to be a winning strategy.

Cohen selected asset finance and projects – two areas in which the global firm had already established tier 1 status in other legal markets around the world, but not in the US. His strategy hinged on attracting top tier talent to the team. Enter John Howitt from Paul Hastings and Zarrar Sehgal from Milbank in 2006, and the two went on to build a market-leading US asset finance practice. Both are now recognised in The Legal 500’s Hall of Fame. Emily Wicker later joined the practice from Debevoise. The team went on to reach the highest tier within The Legal 500 rankings for US aviation and air travel finance.

‘We also now have Patrick O’Reilly and Madalyn Miller as younger partners within the team, and today it is one of the leading asset finance practices in the country,’ Cohen proudly states. ‘It is a $35m practice, with two female partners out of a five-partner team, which I am also proud of as diversity has been a real focus of mine.’

Cohen replicated this success with the projects team. ‘The projects practice covered not only the US but also Latin America and was filled with people like me – Americans who did not speak Spanish. There was one senior associate in our Washington, DC office who was Argentinian and who was the only one who spoke Spanish.’ That associate, Fabricio Longhin, went on to make partner and helped build what is now a market-leading practice. Shortly after Cohen became managing partner, Longhin highlighted the need for more fluent Spanish partners within the team. This led to the recruitment of Gianluca Bacchiocchi from DLA Piper, as well as the promotion of Guido Liniado to partner.

Today, projects is also a tier 1 practice with its own leading lawyers. It has also sat atop the Latin America project finance league tables for three years running. ‘Although the results say LatAm,’ Cohen notes, ‘the legal work is done by US lawyers in New York and DC, the transactions are largely governed by US law, and the capital for the deals is mainly coming from US investment banks. The work benefits countries in Latin America, but it’s a true US practice.’ Here too, Cohen proudly points to the diverse makeup of the team – 80% of the partners are diverse, and 40% are women.

As a result of Cohen’s strategy and the work of its teams, banking and finance has grown to become an $80m practice.

“Lockstep culture and the lockstep system makes it better for the client. And at the end of the day it is all about the client and we have to put clients first”

In 2013, Cohen became regional managing partner for the Americas. Given the success of his approach with the banking and finance practice, the same focus was adopted for the Americas strategy in 2015. Along with his practice leaders, Cohen once again decided to focus on building those practice areas where Clifford Chance US could compete with the elite. ‘We have focused on building out our partnership in those areas where we can have leading positions. For us, that meant identifying areas where, with reasonable investment, we could develop leading practices, as we had already done in asset finance, projects, REITs, and tax. We are a firm that wants to be known for quality, so we had to identify the areas in which we could compete with the best firms, and then begin to build those teams.’

One area where Clifford Chance already had elements of clear strength in the US was its wider LatAm practice. It took what it had and built from there.

Cohen points to several key partner additions across different transactional practices: ‘We promoted Thais Garcia in corporate M&A. We brought in Hugo Triaca from Skadden to bolster our capital markets offering. And Ignacio Suarez Anzorena returned to the firm to give us more heft in international arbitration. All of these individuals have native fluency in Spanish, and their associate, secretarial, and BD support are also Spanish speaking. Today we have one of the most robust international LatAm practices in the region.’

Cohen’s regional strategy has resulted in year-on-year growth for the firm in the US and a growing abundance of domestic work. ‘When I came back from Asia, we were thought of as that British firm that merged with Rogers & Wells. Today I don’t hear that anymore. In my view, we’re not a Magic Circle firm in the US; we’re a strong US firm comprised of US lawyers competing against US firms for domestic work. In fact, of our nearly $300m in revenues last year, 85% of it was self-generated, so we don’t sit here waiting for the phone to ring from London or elsewhere.’

One of the primary drivers of the firm’s success in the US in recent years has been its litigation and dispute resolution team, which is currently advising on one of the world’s most highly visible anti-money laundering cases. The investigations practice, in particular, operates at the top of the market, advising on headline-grabbing matters, often opposite the US Department of Justice.

In addition to multiple representations in the Mueller-Russia investigation, Clifford Chance’s litigators have led on several precedent-setting matters in the US, including: a US court ruling that set a new precedent for deferred prosecution agreements; another ruling that produced a significant setback to prosecutors seeking expansive theories on which to build an FCPA case against non-US companies and individuals; and representation of Chinese telecoms giant ZTE, where the firm secured a first-of-its-kind temporary general licence to allow the client to continue operating during a multi-agency, multi-year US export control investigation.

The best team

The asset finance team, and the projects team, effectively highlight the importance of having the right people. The firm has very carefully selected lateral partner hires to ensure a ‘cultural fit’ and have focused on hires that aid in the execution of the Americas strategy.

Culture and compensation

Clifford Chance is still a lockstep firm within the US – a differentiating factor from many New York firms. Cohen says the firm does not wish to break lockstep to attract lateral partners who may take their practices and jump to the next firm that pays them more money. ‘We’ve taken a different approach, and it’s worked well for us,’ he says.

‘What we have done is to focus on talented, young, and ambitious partners who want to build their practices at Clifford Chance and develop within the firm culture. After they’ve built their practices, we see other firms reach out and try to lure them with increases in comp, but their roots are here, with us. We brought them in, we supported them, and they stay because they love the firm. That cultural glue is a key differentiator for us.’

“I can’t change society – but at least within Clifford Chance I can make this a place where anyone can succeed based on merit”

He goes on to highlight what he sees as the client-focused benefits of their lockstep system: ‘The nice thing about lockstep is you are less focused on your own compensation – instead, you are focusing on the client and bringing a team together to serve them in the best way possible. Clients have a lot of choices – there are a lot of good firms in New York – and we want them to appreciate the value Clifford Chance brings to them and come back to us. Lockstep culture and the lockstep system makes it better for the client. And at the end of the day it is all about the client and we have to put clients first.’ And clients say they notice the difference. As Cohen noted, ‘one of our clients recently told me they can tell when partners who visit them are from a lockstep firm because they bring colleagues and are willing to share the business.’

Cultural fit and hiring for the long-term are important within the firm. ‘We don’t recruit people with sharp elbows. We have even turned down people with books of business others would take. I am not focused on “buying a book” today; instead, I want to add partners committed to growing their practices, with the support of the firm. I think that’s why our attrition is so low and why others choose to join us – it’s because of our culture of collaboration, collegiality, and respect.’

Cohen can back this up with examples, one of whom is Sharis Pozen, who joined the firm’s antitrust practice in Washington, DC in 2019. Pozen was the global head of competition law and policy at GE before joining the firm, and was the target of a number of leading US firms. However, she joined the team at Clifford Chance because she had worked with them during her time at GE. ‘She loved the culture and she loved the people she knew and met during the recruitment process. We offered her one of the best antitrust teams in the world, but I still think culture was a big part of the reason she joined us’.

Another example is Gary Boss, who favoured a move to Clifford Chance in 2012 instead of the perhaps more obvious move to Willkie Farr with his then fellow Dewey & LeBoeuf insurance partners. Cohen has an explanation for this: ‘He saw an opportunity to build his business with us because of the platform we have here and because we are supportive of partners who are innovative. We surrounded him with the support he needed to leverage his creativity and make things happen. He has helped raise $14bn and launch 11 new reinsurance companies in the last five years. He has become one of the leading insurance M&A partners in the world and rightfully earned a tier 1 status he did not have when he joined us. We couldn’t be more proud of the team he has built around him, or what he has accomplished since arriving here.’

Attracting top talent who have numerous other options, or more seemingly obvious choices, makes the wider legal market pay attention. But what really tells the story are the numbers. Of the last ten US laterals who now have at least four years at the firm, fees billed have increased, on average, by 350% between their first and fourth full years.

The focus on inclusion

What is clear from how Cohen speaks of the US offices is that building a diverse and inclusive team is a critical component to building the right team. In fact, the last US partner promotion round consisted of entirely diverse candidates. ‘We want to be a place where female, minority, and LGBTQ lawyers feel they can succeed. And instead of just saying it, we are putting our commitment into action, and it is clearly working as our new class of partners is 100% diverse. I don’t know how many other firms in New York can say they had a 100% diverse class at their last partner promotions.’

Cohen can freely cite the diversity statistics of the firm and openly expresses his pride in the role he has played in achieving them. ‘I am very happy to have doubled the percentage of female partners in the firm here in the US – we have almost 20% female partners and the US partnership overall is almost 30% diverse. I am working to continue driving those percentages higher. The Americas Management Committee is 30% diverse because you want and need that diversity of thought and ideas. I can’t change society – but at least within Clifford Chance I can make this a place where anyone can succeed based on merit.’

Tackling the war for talent

The focus on culture and inclusion within the firm is evidenced by three no.1 rankings in US survey results for associate satisfaction, diversity, and the summer associate programme. ‘We are also number three in the list of top firms in the country to work for,’ Cohen states [referring to the 2019 Vault US Survey].

He recognises the importance of this ‘because there is a war for talent’. Every law firm wants the best associates from the best law schools, so the firm’s status as number one for associate satisfaction and number three in the top firms to work for is a huge advantage on the recruiting trail. ‘Young people take notice,’ says Cohen. ‘If you bring in the right people and you support them and create the right environment, then good things happen.’

The right clients

Having seen the work to put their house in order, so to speak, the next area to look at is the firm’s client roster in the US. This is another area in which they have succeeded, having built an enviable client list of domestic companies. From advising iconic US-based Fortune 500 corporate enterprises on cross-border M&A and cybersecurity issues, to advising the largest US investment banks on aircraft securitisations and energy and infrastructure, the firm’s New York and DC offices have developed strong relationships while undergoing a bit of a transformation.

Although always recognised as one of the world’s premier banking firms, Cohen has worked hard during his six-plus years at the helm to diversify the firm’s US revenue streams. At the beginning of the decade, Clifford Chance was overly reliant on mandates from banks in the Americas; however, the region will close this decade with revenue from financial investors and corporate enterprises now both outpacing the banking sector – a notable transformation in a short period of time.

And although they still benefit from the support of and the opportunities to collaborate with other offices across the Clifford Chance network, the US firm now enjoys the position of sending out more work to other Clifford Chance offices than they are taking in. As Cohen acknowledges, ‘this was not the case ten years ago, but things have really turned around. This region is now a net-exporter of work to the rest of the global firm.’ With a healthy list of US clients and domestic work, the US firm is no longer merely an aspiration, but a critical component to the continuing growth of the global network.

“This region is now a net-exporter of work to the rest of the global firm”

Delivering the best

The final pillar in Clifford Chance’s global strategy is what it refers to as ‘best delivery’. In the US the firm is focused on differentiating themselves in a number of ways. The first is through innovation. Clifford Chance Applied Solutions was launched in 2018 to deliver digital solutions designed to more efficiently address large-scale client challenges. Added to this was Clifford Chance Create, which looks at ways in which the firm can create products for clients to help with their legal operations – products such as CC Draft.

The firm’s best delivery component comprises a team of people (including continuous improvement experts, project managers, and legal technologists) who are able to streamline processes for lawyers advising on legal matters – usually of significant size and scope.

‘It all starts with the client and bringing added value to them. You pair that with our collaborative approach and lockstep culture and that is how this firm has produced the results it has in recent years. The legal profession is changing. We are committed to being out front and leading the transformation. We are very focused on process improvement. Increasingly, our partners are looking to add the best delivery team to their matters for a variety of reasons. For example, a matter may have fixed pricing; if our best delivery colleagues can work out a way to run that matter more efficiently, that benefits both the client and the firm. For the first time since I’ve been practicing law – and that goes back decades – you have someone totally focused on process and efficiency for the client. That is a real game changer and we have won a lot of deals because of it.’

The focus on clients and creative ways of thinking about their legal issues, and the investment in innovation and development, are competitive advantages. Cohen attributes this to their success in the legal rankings, saying: ‘We don’t compete on size, but our rankings reflect the overall quality of our offerings. That’s important when you’re competing against the best US firms – as a US firm.’

“It all starts with the client and bringing added value to them. You pair that with our collaborative approach and lockstep culture and that is how this firm has produced the results it has in recent years”

Looking forward

When asked what lies ahead for Clifford Chance in the Americas, Cohen says: ‘The areas where we have already achieved tier 1 status will continue to receive the necessary investments to maintain their leading positions, but we’d like to get closer to 500 lawyers over time. Our strategy is working for us, so where there are opportunities to grow we will. I want to grow, but I want to grow strategically and not just for growth’s sake. I always want to be known as a top tier firm doing the best quality work for the best clients.’

The US firm has evolved and is vastly different from where it was five or ten years ago. While the odd competitor may still enjoy the opportunity to refer to it as a British or foreign firm, it has now well established itself within the US market – as evidenced in its top tier status within legal directory rankings and some creative, aggressive marketing that has people talking and running into the Clifford Chance brand more often in the US.

CMO Mike Kachel has worked closely with Cohen to develop the Americas strategy and promote the unique aspects of the firm’s culture. For example, Kachel collaborated with The Legal 500’s GC magazine to develop a bespoke publication, Advice To My Younger Self: Reflections of Successful Women Lawyers. The book, which profiles Clifford Chance female partners and alumnae from around the world, launched in April 2017 and has now been seen globally by nearly 30,000 people. In April 2019, the firm followed up with another collaborative effort with GC magazine to produce Their Voices: Insights From Today’s Rising Lawyers – a second publication that is being used by the firm’s US recruiting team to help law school students understand what’s it’s like to be a junior lawyer at Clifford Chance.

‘I’m always mindful,’ says Kachel, ‘that our offering is legal services, but our product is people. There are a lot of great lawyers in the US, and the truth is, many of the matters we advise on could just as easily have been handled by a different firm. But a key question for clients is this: who do I want to work with, and who do I trust? Highlighting our people – what drives them, what’s important to them, what their values are – is an important part of our marketing platform.’

It cannot go without note that despite all of its efforts, Clifford Chance remains excluded from one notable list. ‘The American Lawyer’s Am Law 100 has evolved into the arbiter of elite firms [in the US], and because the majority of our lawyers overall are not in the US, we do not qualify to be included in its various performance rankings,’ explains Cohen. But as he points out, ‘we’ve found other ways to get our brand out there, and more people are beginning to understand we are a real US firm, with US born, bred, and educated lawyers working from US offices for US clients. We’re no longer flying under the radar.’

The proof is in the pudding

So is the US strategy working? If further evidence is needed in addition to the firm’s position within the top tiers of many of the US rankings, or in addition to its ability to attract top US talent and sought-after US clients, then the ultimate proof is in the numbers.

The firm has achieved a 50% increase in US revenue since Cohen became managing partner at the beginning of the 2013/2014 financial year. And in the current fiscal year, they are on track to exceed $1.2m in revenue per lawyer. ‘We’re closing in on the top 25 for US RPL, which is pretty good for a group of 300 lawyers not recognised as a NY firm,’ jokes Cohen.