What the magic circle will look like - part two

What on earth is a "white shoe path"?

Jim -02 Mar 2009 | 00:00

It’s referring to white shoe law firms, the closest New York has come to producing a tag like the magic circle. It’s a very rough comparison as white shoe is as much about historical and cultural influences as it is the economic model. As such, it’s arguably out of date and many firms resent the tag due to its WASPish image despite the prestige factor. In business terms, it denotes a conservative model and view of partnership, a domestic focus and a rejection of the corporatisation of law. That’s why Cravath and Davis Polk can be termed white shoe but Skadden cannot. Confusingly, neither can Wachtell for cultural reasons, though its actual business model is a distillation of the white shoe concept. That reference just means that, while the big four in the magic circle firms are stripping down their partnerships, they are refining their model, not junking it in some attempt to ape a small band of Wall Street law firms.

Alex -02 Mar 2009 | 00:00

In responding to the earlier part of this editorial, I used "white shoe" to refer to a small group of highly profitable US firms which, as I understand it, have historically kept costs under control in part by keeping the associate/partner leverage reasonably low, notwithstanding paying market-topping salaries. This seems to me to be a sound approach provided such firms are able to hire associates both able and willing to do their bit (which I have always assumed means hiring at the top end in terms of both ability and drive).

Alex, your idea of white shoe seems different, being based on the values of old-fashioned waspishness from the posher end of US society.

Now our terms are defined, do you agree with the original contention that white shoe (non-wasp version) is something the Magic Circle may well now gravitate towards?

playftseforme -04 Mar 2009 | 00:00

No, I wouldn't agree but that's fine - debate is part of the point of the website. I believe in 20 years if you look at S&C and Freshfields, you won't see a radical difference in their models. It wouldn't surprise me, however, if Cravath circa 2029 looks pretty similiar to Cravath 2009. The white shoe model can probably work for a very select band of firms in New York but I seriously doubt it would be a viable long-term strategy for London-based practices.

Alex -05 Mar 2009 | 00:00

What 'obvious cuts' should Linklaters make to their international network? Profitability in the European offices has risen over the last year because of the relative weakness of the pound vs. euro. One of the reasons for Freshfields having less problems than the more London-centric firms is that it does more work in the euro-zone.

eurolawyer -05 Mar 2009 | 00:00