Clifford Chance: Friends in high places
Clifford Chance has plans to expand its public policy practice. Yes, it will help give clients a say in Parliament - but this is not lobbying, its partners assure Robert Verkaik
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Accusations of British imperialism, bill-padding and unsavoury tales about visits to lap-dancing clubs – any one of these stories might have a sunk an ordinary law firm. But not Clifford Chance, that global superpower of a legal business, which seems impervious to bad news.
Its competitors might have enjoyed some of the embarrassment caused by such a rum mix of tittle-tattle. But the truth is that Clifford Chance is the biggest and most successful law firm in the world. Last year its 3,500 lawyers generated a record £1bn income across 32 offices operating within 19 different jurisdictions.
But for Clifford Chance, this is not enough. The firm intends to extend its already considerable reach into the corridors of Whitehall and Westminster. So last week it was the turn of Clifford Chance's rivals to face up to "bad news" as the firm announced that it intended to expand its highly regarded public policy practice.
Under the stewardship of Richard Thomas, the newly appointed Information Commissioner, Clifford Chance has already redefined the business of a law firm by giving clients a voice among the law-makers. In the old days, lawyers would wait for a government to publish bills before advising clients on what to do. Now Clifford Chance and a select number of its competitors are prepared to offer a lobbying service in which the firm tries to change ministers' minds before the ink has dried on the legislation.
To achieve this, Clifford Chance has committed time and money to luring key players away from Whitehall and the offices of the City of London regulators. In recent years it has recruited Sir Thomas Legg, a former permanent secretary at the Lord Chancellor's Department, and George Staple, a former director of the Serious Fraud Office. Other consultants to the firm include Dame Judith Mayhew, the chairman of the influential policy and resources committee of the City of London Corporation and an adviser to the Mayor, Ken Livingstone. Such high-profile signings have drawn envious glances from around the City.
Last week the firm reaffirmed its commitment to this area of practice by calling on Michael Smyth, one of its established stars and big-ticket winners, to head the operation. To strengthen the team further, Clifford Chance also announced the appointment of Hilary Plattern, formerly the head of legal and public affairs at the Finance and Leasing Association.
Smyth, 45, has risen in the firm as a leading litigator in media and public law, and now heads the pro bono unit. He is currently advising Reuters and The Independent at the European Court of Human Rights in a case that could lead to a greater legal protection for journalists' sources.
The growth of political lobbying among City law firms raises interesting questions about the role of the lawyer. Some argue that the business of politics should be left to politicians and not pursued by City solicitors, whose vested interests are linked to the profits of their clients. After all, aren't there enough lawyers represented at the Palace of Westminster as elected Members of Parliament?
Smyth begs to differ. "What is the biggest law firm on the planet supposed to do? Not only do we think our clients want us to do this work; we think we are entitled to have a view. Law firms have traditionally seen their role not as participants in the process of making laws, but interpreters of existing law for their clients. However, as clients have developed their understanding of the legislative process, and have seen how radically even small changes in legislation can affect their businesses, so the demand has grown for a high quality, well-connected advisory and advocacy service focusing on public policy."
Clifford Chance is careful to distance itself from the professional Westminster lobbyists, whose names have been besmirched by the cash-for-access scandals of recent years. The senior partners would rather it be known that the firm uses its contacts in government for the benefit of all.
Smyth cites amendments to the Financial Services Act as an example of Clifford Chance's contribution to the greater good. Here its lawyers helped to persuade ministers that they needed to take proper account of the Human Rights Act 1998 when drawing up proposals for tribunals to hear allegations of insider dealing and offences of market-rigging. The new disciplinary system offended against the right to a fair trial and lacked an independent appeals procedure. Smyth describes his firm's involvement in this consultation process as "mitigating the harshness" of the workings of this legislation. "I wouldn't want people to think that it is now perfect, but it is better than it was."
The public policy team has also made strong submissions to the Lord Chancellor's Department as part of the consultation process over the future of the legal profession. Unsurprisingly, Sir Thomas Legg played a prominent role in reflecting the views of the firm and its clients.
Sir Thomas's move from the department to Clifford Chance two years ago raised one or two eyebrows in Whitehall, where not so long ago retired civil servants kept a discreet distance between themselves and the private sector. There are many law firms that would relish the chance to discover exactly how a big-spending state department shares out its lucrative contracts to outside consultants. But Smyth says Sir Thomas has been scrupulous in observing Whitehall rules, and will take his commercially-sensitive secrets to the grave.
It is Sir Thomas's contacts and his experience of the way the civil service works that Clifford Chance wishes to put to its own use. Smyth says: "He has certainly helped to guide our thoughts on how to respond to consultations; after all, he was a distinguished mandarin who ran a huge department."
George Staple has been recruited to perform a similar function. His expertise in charge of the Serious Fraud Office was brought to bear in helping to shape responses to the Communications Bill, and is now helping to address concerns about the forthcoming Corruption Bill.
Smyth says that under Tony Blair's administration there is much greater scope for influencing new legislation, because so much of it is presented in draft form so that it is tested against the prevailing winds of public opinion. In this way, says Smyth, Labour gets more of a "buy in" from disparate interest groups across many sectors.
When Richard Thomas set up Clifford Chance's public policy unit 11 years ago, it was the first time a law firm had tried to have a say in the legislative process. Since then Clifford Chance's rivals have been playing, and mostly losing, a game of catch-up. So who could forgive them their moment of spiteful pleasure when a 13-page memo, leaked to a national newspaper, suggested that junior lawyers working in New York were "padding" bills to reach their fee targets? Then, earlier this month, it emerged that a partner from the Bangkok office was demanding £30m to settle his exit from the partnership. In an increasingly bitter dispute, the disaffected partner accused the British lawyers of "imperialism".
And what about the case of the partner who decided it was a good idea to entertain journalists at a lap-dancing club in the City? Clifford Chance has ambitions to increase its political influence in Westminster. If the firm were a political party, stories of this kind would be called sleaze and could do untold harm to its public image. Clifford Chance may not have to answer to an electorate outside its own partnership, but it is still accountable to its fee-paying clients.