King & Wood Mallesons

Introduction

The largest law firm in the Asia Pacific region, Mallesons is also one of the oldest. Its history stretches back to 1832, when 25 year-old Londoner Alfred Brooks Malleson borrowed the princely sum of £10 from his uncle to set up his own law firm in Melbourne.

Since those early days, the firm has grown into a commercial powerhouse boasting over 2,000 employees, of which 1,030 are lawyers. It set up shop in Sydney, Melbourne, Perth, Brisbane, Canberra, Hong Kong, Beijing, London and Shanghai, and also has an associated office in Papua New Guinea. 

And it boasts a pretty impressive client roster including the likes of Westpac, Suncorp, the Westfield Group and Chevron. The firm’s insurance group also took a key role in advising insurers of the councils affected by the 2008 bushfires in Victoria.

Legacy Mallesons twice attempted to merge with Clifford Chance, in 1999 and again in 2008, but both attempts failed and the firm abandoned its UK aspirations. In November 2011, it announced its merger with Chinese firm King & Wood, the first ever Sino-Australian law firm tie-up. The union was formalised in March 2012 (accompanied by an exciting hoverbike-based branding campaign), with the new 380 partner firm now operating under the name King & Wood Mallesons.

Performance

Given legacy firm Mallesons’ focus on transactional work, it’s hardly surprising that the firm did not manage to escape the claws of the GFC. Revenue slumped by 10% to $494.4 in the 2009/10 financial year, allowing Minter Ellison to usurp Mallesons as the top revenue-earning firm.

And the firm’s headcount was reduced by a whopping 13.1%. This was partly due to the voluntary redundancy programme, which kicked off in July 2010, resulting in some 5% of staff being elbowed out.  But, with a 2010 AFR report pointing to a loss of 227 associates between 2009 and 2010, rumours abounded that a “managing out” process had been in effect from the latter half of 2009, drastically reducing Mallesons’ associate population. And whilst the firm was one of the few that avoided cuts to its partnership, this was presumably cold comfort to the rest of its staff.

But things seem to be looking up for Mallesons. It launched an ambitious recruitment drive at the end of 2010, looking to take on around 590 lawyers for jobs across all four of its Australian offices. And the firm also managed the biggest graduate intake, offering 107 positions in 2010. Hopefully pleasing the slimmed down associate population, which had long been complaining of punishing hours at the firm.

And now there’s the new merger with King & Wood, which will operate through a non-profit sharing Swiss verein structure. Already being hailed as a game-changer, the tie-up will hugely boost Mallesons’ Asian footprint and many believe that this union is the first step towards the ultimate goal of merging with a US or UK firm.

Pay and Conditions

Mallesons didn’t fare so well in this year’s Firm of the Year, placing firmly towards the bottom of the table with fairly mediocre 58% overall. The firm was roundly criticised for its lack of work life balance. Respondents complained of a “Culture of extremely late nights with no recognition beyond “thank you”” and for certain departments where hours were “crap” and “unsustainable.”

But it does seem that the firm has started to make effort to at least compensate staff for the gruelling hours and “There was an eventual realisation that salaries had to go up.” And the general consensus seemed to be that beyond the long hours the firm has a “good vibe”, “great quality work” and “generally supportive partners.”

Mallesons has also done its bit to look innovative. It was the first Australian firm to offer 14 week’s paid parental leave to staff members and it was amongst the first to be accredited as a FairTrade workplace. In transparency terms too, the firm is keen to pave the way. The board made the unusual decision to open its books to the public in an effort to show clients how it’s performing. Although this transparency does not always seem to extend to its employees, with complaints about stealth layoffs and unclear salary structures.

Conclusion

Overall the future looks relatively positive for King & Wood Mallesons, with revenues forecast to pick up, a significant recruitment drive adding some much needed manpower and a meaty merger.

Questions remain over the drawbacks of operating in China, which has very strict rules about the influence of foreign firms in the region, including a ban on profit sharing. And clients are already expressing concerns about confidentiality, especially given reports that all Chinese lawyers must take an oath to the Communist Party. While the firm has tried to allay worries by keeping China out of the document sharing system, it shows that there’s rather more to think about with China than its economic prospects.

Closer to home, Aussie lawyers looking to move abroad can’t do much better than getting a couple of years’ experience at the firm. With its blue chip client base, its market leading corporate and finance work, legacy Mallesons' associates are often the first in the line for QF1 when London is recruiting. And for Brits looking for a tour of duty down-under, the work, culture and prestige of the firm is commensurate with Magic Circle firms. But in Sydney at least, the view is way better (which is handy as you’re likely to be putting in some serious hours).