Any law firm that is considering floating on the London Stock Exchange should update its operations and culture “away from the public eye” before making such a move. This suggestion was made by David Beech, CEO of Knights PLC, while speaking at the London Law Expo (LLE) earlier this month. Mr Beech leads one of the five UK law firms that are also publicly-traded companies. The London Law Expo, organised by Netlaw Media, took place at the Old Billingsgate in London on 9 October.
Outlining the scale of Knights’ pre-flotation reorganisation, Mr Beech recalled how the practice had separated its ownership and management structure, reduced overheads, and abolished financial targets and measurements for most personnel. Culturally, Mr Beech explained, the firm had shifted from being based on “big egos” to one based on teamwork. These internal changes took two years to complete, Mr Beech said. The firm then spent another four years growing via lateral hires, mergers, and new office openings, as a prelude to going public.
Remarkably, almost half of the equity partners who worked for Knights at the start of this transformation were still there at flotation, Mr Beech recalled. Among those practices acquired by Knights, the attrition rate was typically between 10 – 20 per cent, he added.
Elsewhere in the conference hall Adrian Biles, CEO of the Gordon Dadds Group PLC, also outlined the dramatic changes that his practice had undertaken prior to its flotation. These changes, he recalled, included corporatising the firm’s governance structure, diluting the ownership of existing partners, moving the practice’s back office to South Wales, hiring new fee earners, undertaking multiple mergers, and diversifying into non-legal services. This pre-float restructuring began in 2013, he said, with an AIM admission following four years later, in August 2017.
Mr Biles also pointed out that Gordon Dadds’ status as a listed company meant that it had to take a clear and transparent approach to international expansion – in particular, its international governance. Unlike some firms, who operate in overseas locations on a “nod and a wink” basis, Mr Biles said “frankly, we had to do things properly”. “We were the first ABS to be regulated by the Hong Kong Law Society (HKLS) – and the HKLS had to change its rulebook to accommodate us,” he explained.
Reflecting on the event’s proceedings, Frances Armstrong, Netlaw Media’s UK and EM UK & EMEA Managing Director, said. “The past few months have seen a great deal of interest in law firms floating on the London Stock Exchange. Undoubtedly, the excellent presentations by Knights’ David Beech and Gordon Dadds’ Adrian Biles gave LLE attendees a great deal to think about.”
“That’s one reason why events such as the LLE are so important to the profession: it gives a chance for senior legal practice personnel to share their experiences – good and bad, for the benefit of the sector as a whole.”
A full report of this year’s LLE will be available shortly. Besides law firm flotations, the LLE included discussions on “New Law versus Big Law”, legal practice innovation, legal AI, business development and law firm security – amongst many others. This year’s keynote presentations on leadership and transformation were delivered by Admiral Sir Trevor Soar KCB OBE DL and Baroness Martha Lane-Fox CBE.
The 2018 London Law Expo is the 19th event organised by Netlaw Media since the company was formed in 2008.
Like every other event organised by Netlaw Media during its ten-year history, this year’s London Law Expo sold out in advance of show day.
To keep up-to-date with the latest BLTF news, follow @NetlawMedia on Twitter or visit www.londonlawexpo.com.