Minter Ellison moves to take on big four – The Australian Financial Review

Jon Finlay (L) and Andrew Cunningham from Minter Ellison.

by Edmund Tadros

Minter Ellison has fired another shot in the battle between law firms and major consultancies by hiring a team of four executive pay specialists as part of a strategy to expand its reach to non-legal consulting work and grow revenue to $600 million by 2020.

The firm has also revealed it grew annual sales by 6.5 per cent to $456 million in 2015-16, amid a flat legal market.

The law outfit is further broadening its range of services, including legal process management software and other digital services, as it aims to increase sales by almost eight per cent annually on a compound basis over the next four years to reach the $600 million target.

The move into non-legal advisory work comes as KPMG, EY, Deloitte and PricewaterhouseCoopers – big multi-disciplinary firms with revenue ranging from $1.37 billion to $1.92 billion – have made aggressive moves to provide legal services to clients they normally would have directed to law firms.

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In-house referrals

Minter Ellison has poached Jon Finlay from advisory firm Willis Towers Watson Australia, where he was head of board and executive remuneration, to take on a similar role at the law firm.

Mr Finlay, along with his team of three experts, will provide salary strategy advice, firstly to the law firm’s merger and acquisition clients, and then directly to the wider market.

“It’s really about focusing everybody from being a trusted legal advisor to being a trusted adviser,” Mr Finlay, a consulting veteran of 35 years who has worked at three of the big four accounting and advisory firms, said.

“And for more of that referral work to be staying in-house rather than moving off in other firms in other disciplines.

“One of the biggest things that clients want is that you can refer them to someone you would use yourself and it won’t get out.”

Remuneration advisory is a niche area with prominent independent firms such as Egan Associates competing with global firms such as Mercer, KPMG, EY and PwC.

KPMG has 25 staff in its Performance and Reward practice, EY has more than 70 consultants in the reward consulting space and PwC also has a remuneration practice.

Minter Ellison intends to grow  the remuneration practice to eight staff by 2020, said Andrew Cunningham, the law firm’s innovation and networks leader.

“We think that a leading practice in the market will be about double the current size,” Mr Cunningham said.

“What’s really interesting is the growth strategy. It’s not about voting in a team that does something new. It’s about extending existing services.

“We think we’re unique amongst the Australia legal firms in having the legal and consulting together in one package.”

Ahead of the pack

The firm has jumped ahead of its legal rivals with the overt move into non-legal consulting work.

Herbert Smith Freehills and Ashurst both said their non-legal advisory services were offered only as part of their legal practices.

“[We have a] range of bespoke value-add offerings to complement their core legal services and which address clients’ key needs and opportunities, but nothing that [we] package up as a formal consultancy practice proposition,” said Arriarne Kemp-Bishop, a spokeswoman for Herbert Smith Freehills.

Ashurst spokeswoman Lillian Birchall said: “We have that remuneration advisory capability in-house, aligned with our Corporate, Employment and Tax practices, but we don’t have a separate remuneration advisory in the works.”

​Allens, Clayton Utz, Gadens, King & Wood Mallesons and Norton Rose declined to comment.

Law start-up LegalVision does non-legal consulting work to clients to improve the operation of in-house legal teams.

“We’ve been doing more and more tech [and] consulting work for clients,” said Lachlan McKnight, the firm’s CEO.

His staff run clients through a workshop process to identify problems and come up with potential solutions.

“Our development team can then build a tech solution, or our lawyers [and/or] strategists can help put in place a new process,” he said.

Minter Ellison v Big Four

Minter Ellison is one of the largest law firms in Australia by revenue and partner numbers with 202 partners and 961 lawyers.

But its desire to emulate the big four accounting and advisory firms brings it into competition with professional service giants that have at least double the number of partners and thousands of professional services staff, and who all have their own legal service arms.

PwC has the largest legal team of 75 working in areas including corporate advisory, regulation, finance and employment law.

Deloitte has more than 40 lawyers who focus on taxation.

“The legal market is large enough for both the external legal firms and the legal practices within the accounting firms to have a key role and reflects the evolution of client’s needs for legal services in Australia,” said James Fabijancic, the lead partner at Deloitte Lawyers.

KPMG has 40 lawyers working across areas such as mergers and acquisitions, equity capital markets, corporate advisory and foreign investment.

“Our primary approach is to work on an integrated basis with our colleagues across KPMG to deliver a full service solution to our clients, however, we also deliver legal services on a standalone basis to certain clients,” said David Morris, the head of KPMG Law.

EY has more than 30 lawyers working in areas like commercial law, mergers and acquisitions and employment law.

edmundtadros@afr.com.au

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