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Clifford Chance LLP
Published April 2011
2011 Vault Ranking: 29
Though the United States is host to the vast majority of megafirms in the world, London is home to the single largest firm in the world. Clifford Chance has 3,600 attorneys in twenty-eight countries, and prior to the most recent recession had the highest revenue in the world, at $2.65 billion in 2008. Though that number took a heavy hammering during 2009, the firm still holds its position as number three overall in the world for revenue. Like most Magic Circle firms, Clifford Chance is an international venture primarily known for its corporate and international transactional work.
Clifford Chance as it exists today is the result of a number of relatively recent major mergers in the past few decades, though its component firms can trace their history back to a London law firm founded in 1802. The two major components of the firm prior to 1987 were the predecessor firms Clifford Turner and Coward Chance, both London based. Neither firm was considered among the first tier of London firms, but their merger created a nine hundred pound legal gorilla, and had a substantial impact on the shape of the European legal market.
In 1999, the firm absorbed two other firms: the Frankfurt based Pünder, Volhard, Weber & Axster, and the American Rogers & Wells. Rogers was a New York firm, founded in 1873. It had a very well known litigation group, and a prolific capital markets and international finance practice, with such major clients as Merrill Lynch. The merger gave Clifford Chance the foothold into the American market that it needed to become a truly dominant global legal power.
Clifford Chance was hit very hard by the global recession. It is unclear to what extent any given factor played a role, but it was clearly a combination of over-extension, redundancy from recent mergers, and high exposure in the hardest hit practice areas of finance and major corporate transactional work. In 2009, global revenue dropped nearly twenty percent, and profits per partner dropped thirty percent. Throughout 2009 and 2010, the firm engaged in a number of significant layoffs, including pushing out ninety partners, close to fifteen percent of the total partnership.
Clifford Chance has a long history of involvement in a wide variety of cross border transactions, finance, and securities. Its clients have included public and private corporations, investment banks, and assorted private equity firms. Much of its US-related work involves either foreign clients investing in the United States, or US firms making acquisitions abroad. It is currently advising Kraft in its attempt to purchase British confectioner Cadbury. As recently as 2007, Clifford Chance was named “Law Firm of the Year” by both Financial Times and the MergerMarket M&A Awards.
The firm has a separate and distinct finance and restructuring group that works primarily on the lender side. It handles all manner of complex international backruptcy, asset finance, and debt trading work. It also rounds out its corporate practice with a strong structured capital markets team. Though it does have litigation capabilities, they exist primarily to support the various corporate and transactional departments.
Because of its international focus, the firm has a presence in the Vault practice area rankings that focus on American markets. Clifford Chance does still manage a very good sixteenth place for General Corporate Practice and nineteenth for Private Equity. Most notable is the sixth overall ranking for international practice.
Clifford Chance is ranked nationally by Chambers and Partners in Band 1 or 2 for assorted Capital Markets and Projects work. It is also ranked in New York in Band 2 for Banking and Finance, as well as Insurance, and Band 3 for Latin American Investment and Corporate/M&A.
Clifford Chance, like most firms, wants to see strong academic credentials from an excellent institution, or stellar academics from a more regional school. However they also freely admit that they are willing to overlook some blemishes on a GPA if there is a strong match personality wise. The firm wants individuals who are personable, self-starting team players.
Clifford Chance offers summer programs in both of their American offices, New York and Washington D.C. The program is ten weeks long, during which summer associates are expected to complete ten to fifteen projects. Because of the emphasis on cross border transactions, summer associates with an interest in transactional work are able to spend part of the summer in an overseas office, including Frankfurt, Hong Kong, London, Milan, Moscow, Paris, and Dubai. Weekend and off hour work is not uncommon due to the global nature of the firm, and summer associates are expected to check their BlackBerrys regularly.
The firm holds weekly training events for summer associates, and encourages them to attend unlimited attorney lunches. Clifford Chance also holds the standard social events such as wine tastings, cooking classes, and trips to Shakespeare in the Park. Social events are a mixture of formal and informal. In 2009, 24 of 25 US summer associates were given offers, despite layoffs occurring in the rest of the firm.
Compensation and Benefits
Clifford Chance follows the standard lockstep salary system for US associates. The rate tracks the standard big firm market rate of $160,000 for first year associates. Bonuses at the firm tend to follow the market leader. In both 2010 and 2011, the firm matched the top of the market rate for bonuses.
There is no official minimum billable hours requirement, but associates are expected to bill at least 1,850 hours annually. Failure to meet this goal may result in reduced or no bonus. Further, given recent layoffs it would be unwise to risk being perceived as someone who is not pulling their weight. Face time is similarly important, and associates are expected to be in the office during regular working hours. There is a tendency for partners to forget people exist if they are not putting in a sufficient amount of time around the office. Weekend work is common, but generally done from home. Associates are granted four weeks of vacation time. Most associates make use of the majority of it, but canceling vacations for work is known to happen.
Benefits at Clifford Chance include a subsidized on-site cafeteria, subsidized gym memberships, and a voucher for a dinner for two up to $400 if an associate bills over 250 hours in a month to client matters. The firm also gives access to two firm-owned vacation properties in Florida. New associates are reimbursed bar expenses and provided a $10,000 relocation stipend.
Clifford Chance uses a two tier partnership process. After eight to ten years, an associate becomes eligible for non-equity partnership. Equity partnership requires another two to three years beyond that. Achieving partnership at the firm is a very difficult goal. Beyond simply the difficulty of gaining notoriety in such a large and expansive firm, the firm has recently cut back on the total number of partners in response to the economic climate. Further, the firm has regularly added partners from outside the firm as laterals, so an associate will be competing with those incoming rainmakers for a cut of the profit pie.
When the best and most descriptive word used to describe a firm’s culture is collegial, you know you are dealing primarily with a firm that is simply a place of business and nothing more. It comes as no surprise that most megafirms have very little overarching cultural themes, compared to the smaller boutiques and niche firms. Clifford Chance is no exception. While associates generally praise their polite and friendly colleagues, the firm is not a place that emphasizes socializing. Most people just want to get their work done and go home.
Further, morale has been devastated by recent cutbacks. Though it is slowly improving, a decline in communication between management and the rank and file during the economic crisis compounded the already plummeting morale when layoffs were occurring and transactional and finance work was drying up. Though there are some whispers that the situation is improving and work is picking back up, there may be some irreparable damage in terms of the communal psyche.
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