Madrid annual report
firms in Spain have doubts that
US firms will actually take such a
step. One says: “It’s hard for me
to see opportunities for more US
firms in Spain, it’s not a high-fee
jurisdiction, I’m sceptical about
what the business case is.”
Franco says that the legal
arms of the ‘Big Four’ are making
an impact on the Spanish legal
market. “They [the Big Four] have
determined growth strategies and
are investing a lot in technology,”
he adds. However, another partner
remarks that there has been an
“independence issue” affecting the
´Big Four’, though this has “been
diluted” in recent years. Berricano
argues that the ´Big Four’ could
change the way law firms work
in the sense that “clients are
splitting up the work [they give
to lawyers]”. Meanwhile, Ruiz-
Cámara predicts that there will be
more consolidation among mid-
sized law firms in Spain in future.
According to one managing
partner, “it’s bad news for law
firms” that the ‘Big Four’ are
winning a lot of due diligence
work. He adds that the more
profitable work for law firms is
due diligence work for vendors.
Another partner remarks that
losing due diligence work to the
´Big Four’ should be a concern
for law firms because doing due
diligence is “wonderful training”
for young lawyers. He adds that
more traditional law firms have to
be careful because when it comes
to fees, they are getting “smashed”
by the ‘Big Four’.
Bernad observes that, in Spain,
the ‘Big Four’ have taken a share
of big-ticket corporate tax work.
He adds: “In addition to corporate,
there are big areas of high value
added in relation to tax, transfer
pricing – which is way to enter into
more strategic work – as well as
private client, financial products or
litigation.” The ‘Big Four’ should
not be dismissed and are serious
competitors, according to one
managing partner. “They are now
seen on big deals, they’re hiring
talented people from investment
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banks – due diligence work done
by the ‘Big Four’ can open the door
for them to demonstrate to clients
that they can do other work in a
more profitable way.” Another
partner remarks that the ‘Big Four’
are well-funded and consequently
they have an opportunity to “get
What are the biggest management challenges law firms currently face?
“In addition to technology, globalisation and talent management. On globalisation,
each firm needs its own model suited to its specifics, such as UK or US law
capabilities or other cultural and legal models. In our case, Iberoamerica is key. In
relation to talent management, the key issue is being able to integrate women into
the partnership so that it reflects the percentage of women lawyers they currently
hire.” Fernando Bernad, Madrid managing partner, Cuatrecasas
“Brexit, and election results in other countries. The need to deal with changes
brought about by digitalisation, the use of artificial intelligence and information
technology. In this context, new risks are emerging, such as cybersecurity.” Pilar
Menor, Spain managing partner, DLA Piper
“Adaptability. The more a law firm adapts to its clients’ needs, the more successful
it is likely to be. There are a lot of expectations based on how technology will
improve the delivery of legal services, but if technology is not able to meet the
needs and requirements of clients, it is unlikely to succeed. The environment
changes very quickly and adaptation to new scenarios is critical. Law firms will
need to train their professionals in a more competitive way, so that they are
provided with attributes such as a global and strategic mindset. It is not only
about being technically skilled – which is taken for granted – but also being able to
perform well in global environments and overcome cultural gaps. Internal policies
to support this will be key.” Adolf Rousaud, managing partner, RCD – Rousaud
Costas Duran
“The crisis has taken a toll on all sectors and fees have been directly affected.
Lawyers find themselves obliged to develop new strategies to remain competitive.
Moreover, law firms have to deal with risks that new technologies pose, especially
due to the huge amount of data they handle. So, for example, law firms have to
update and control all IT systems in order to prevent any potential attack that
affects their clients.” Jesús Vélez, managing partner, Kennedys Abogados
“Competition on pricing is a big challenge law firms face. Clients want efficiency,
value and lower costs. In the end, clients can demand these things because law
firms need the business. Thanks to mobility and other disruptive technologies,
legal professionals are working from home without going to the office. There
are more and more lawyers who are doing this and doing quite well. This might
be another management challenge for a law firm.” Javier Cremades, founding
partner, Cremades & Calvo Sotelo
“The biggest challenges are related primarily to compliance. Law firm managers
must make sure law firms act within the law, particularly in relation to money
laundering, data protection and confidentiality.” Fernando A. Martín Martín,
partner, Loyra Abogados
“Increasing competition on fees, charging accurate fees, and getting paid.”
Francisco G. Prol, partner, Prol y Asociados
May / June 2017 • IBERIAN LAWYER • 29
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