Legal Business: What has the pandemic taught you about leadership?
James Palmer: Everything teaches me. The last 15 months or so have been – and I’ve said this internally – the most extraordinary of my lifetime in most respects. Who would have anticipated this? I like change and challenge, but nothing prepared me for a year at home. Has it taught me things? Oh boy – yes!
It’s reinforced some things. I’ve always thought it’s about doing what you think is right and leading people, not leading yourself. To do that, you need to have trust and you need to be decisive.
In January last year our China offices were very significantly affected, months before it hit the rest of the world. By February I could certainly see something very significant about to happen. By early March, we had a board meeting in Melbourne. Someone said to me before we went: ‘James – do you really think we should be flying out in the current climate?’ I said: ‘I think we should go, because there’s no safety risk flagged at the moment, and it might be the last time we get to meet for 18 months.’ Everybody gets lucky once in a while!
I remember being a junior associate during the 1990s’ downturn; it was a really bad recession. Brutal. In that, law firm profits absolutely plummeted. I knew it could happen today. But then you think: ‘Am I overreacting?’
In the end we were decisive and we moved very fast and overall it wasn’t that bad. In human terms it was obviously awful, but in business terms it was awful for a month or two but then it rebounded very quickly and we were frantically busy.
Mark Rigotti (HSF’s previous chief executive) knew he was handing over, and so he really let Justin D’Agostino – who became CEO on 1 May 2020! – get involved in the transition. Justin did all the pandemic response. Justin is a very adaptable and agile person, overtly empathetic. That style of leadership really helped, as well as taking a strong, decisive action.
It’s taught me a staggering amount about working from home. My EPA has always worked flexibly, and I always believed in it so long as it retains talent. But I never dreamt that the whole firm and sector could transition so quickly to working effectively from home. I had never done a Zoom call or a Skype call.
Strong leadership in response to crisis is really important, and not worrying about not getting it all right. But when the buck stops with you… I’m not going to pretend that I didn’t have many sleepless nights in April last year.
‘I never dreamt that the whole firm and sector could transition so quickly to working effectively from home.’
James Palmer, Herbert Smith Freehills
LB: Is it fair to say that the rapid transition to remote working en masse has shattered some preconceptions around flexible working?
Palmer: It has absolutely smashed to pieces all sorts of assumptions. I had nothing to do with our original rollout of agile working, but I’m glad that we rolled it out very assertively in the UK – my colleagues showed a lot of foresight.
It’s not surprising that people make incorrect assumptions based on our experiences – it’s completely human. We’re all products of our experience. Of course, people who have only ever worked in a physical-presence environment have assumed that was a prerequisite to doing their jobs effectively. They were wrong.
I’ve got grown up children and it’s fascinating talking to them. Their generation often sees the failings of my generation on social liberalism, inclusivity and stuff like that. We all worked in environments where things we would now consider disgraceful went on. But you absorb assumptions. Challenging those assumptions is a productive thing to do.
I would say to our younger lawyers: what are the taboos and assumptions we are making now? Like inclusivity, working from home. There will be many others, where people in 20 years will look back on us and find us stupid.
LB: How do law firms ensure they are recruiting and nurturing talent?
Palmer: It’s all psychology really. Sweeping generalisations are always dangerous because people are different. But I think that law is full of high achievers, and it has a lot of correlations with high-end medicine and academia. They’re all social organisations filled with very clever groups of people. One of the great advantages of not always having come top – I’ve never been worried about people being cleverer than me.
But there are a lot of people who grow up, and are competing at school, university who are very invested in how bright they are. That breeds excellence in law, and they are very proud of their expertise. But it is very easy to value the skillset you have, and wish to expand it and be famous for it in your own little world. We have a bias towards the things that fascinate us. That is absolutely true of law.
Fostering a culture of inclusivity requires us to empathise with those whose demands are different from us. For a very long time I’ve done talks to our new partners and new graduates, going back to 2002. I remember myself, and fellow partners Gavin Davies, Jonathan Scott and others, we were frustrated at the lack of culture change at HSF so we wrote fresh induction programmes for new partners to instil some common values. In the first slide deck I wrote: ‘Be polite and respectful to those who might not be as smart as you, they might be nicer than you. Chill out a bit.’ None of us gets it right all the time, but I became aware years ago of the need to apologise. Apologising is always the right thing to do – it’s hard, but it’s way worse than not apologising.
‘You have to foster culture change from the top, otherwise it’s opt-in.’
James Palmer, Herbert Smith Freehills
LB: How on earth do firms generate a purpose? And how do you disseminate it? Is it just flyers on a wall?
Palmer: I think most lawyers have a purpose. The question is whether they have ever thought about it. Most human beings want to do a good job at what they do, whether that’s cleaning a floor, working in a shop or running an IT function, they want to do it well. And some of them get bored, some don’t feel valued or respected, but I think most people are motivated by doing something useful.
Human beings are motivated by purpose. The writer Dan Pink has written about this, saying humans are motivated by mastering skills, autonomy and, thirdly, purpose. A desire to do something useful with others, not just for yourself. For me, that sums up most people. So I start with that. If that’s what motivates humans, you’re going to tap into that.
No organisation is ever going to have a uniform identical purpose. But you can create an overarching one, and I think we have one – just not plastered on walls. Our purpose is centred around integrity and helping our clients but doing it in a way that I’m proud of. To me the core role of lawyers, our day job, is helping people navigate the way their lives and businesses interact with regulation. Whether it’s moving house, writing a will, expanding a business. Those are moments where the law brings so much complexity, expertise is required. What’s wrong with that? It’s nothing to be embarrassed about. We’re not frontline workers saving lives, but most human beings aren’t. But we all want to help people nonetheless. A good structure facilitates that.
One of the things I’ve focused on during my time as senior partner is culture change. You have to foster it from the top, otherwise it’s opt-in. Culture change is just about improving habits, it’s what you automatically do. Law firms have an incredible culture of integrity – not always perfect – but generally they are really high-integrity organisations.
LB: Is there not an inherent hypocrisy in law firms preaching purpose and ESG credentials while representing clients that contradict those principles?
Palmer: There has always been conflict there. There’s always been a mix of people in the law. Whether it’s City law firms or high street, the judiciary, or the Bar. Different personalities with different drivers. ESG is a new label, but a desire for social impact and relevance has permeated large numbers of lawyers for generations. Think of all those civil rights lawyers.
A lot of people who have studied law will have gained a strong belief in the effect of law in championing civil rights. When I was a junior lawyer, I remember partners around me doing endless charity work, it just wasn’t called pro bono. They had a sense of purpose in doing something beyond their day-to-day client demands.
I remember when environmental legislation first came in during the 1980s and 1990s. It’s a continuation of progress where you take for granted the progress that came before and focus squarely on what we can do going forward. It’ll be the same again in 20 years’ time: ‘James, you idiot, you were blind to what was happening!’ But we’re nice, principled people trying our best.
Law is, in my view, something entirely human. It’s not meant to be the moral standard for society, but to set extreme boundaries. Criminalise things that are extremely bad. Civil matters require intervention and are designed to influence behaviours and fairer outcomes. If you look at the law as something innately human, you have to look at it within the context of society. Society keeps changing, so therefore there is a constant tension and a constant need to change moral standards. I don’t think people today are better than when I started but in relation to tensions – you just have to make judgements. I don’t think it is anti-ESG to say that I am the relationship partner at HSF for some of our large energy clients. Am I embarrassed about looking after those clients? Not in the slightest.
By the way, we’re all using smartphones and Zoom which use vast amounts of energy. By the way, we’re all consuming. We all want to switch to green sources but don’t want to stop everything in its tracks to do so! There aren’t enough green sources to switch entirely overnight to low carbon. It’s a fallacy. So why be embarrassed about the realities of our society? I am proud to work with our energy clients, not just because of their extraordinary commitments to change.
Fundamentally, companies who provide people with useful things society wants are entitled to good legal advice.
The idea only bad people will act for these companies is missing the point, and it’s an overly simplistic view of what these companies are.
‘Fundamentally, companies who provide people with useful things society wants are entitled to good legal advice.’
James Palmer, Herbert Smith Freehills
LB: So it’s not just PR then?
Palmer: I’m very proud of our position on ESG. I don’t think it’s flag waving or a sticking plaster, and if I see any ESG response that is flag waving or a sticking plaster, I have an allergic reaction to it.
If you are the chair and senior partner of a law firm, the buck stops with you. People can drift into glib phrases but I have never done that, because then I think you stop speaking truth. I am genuinely proud of what we are doing in ESG, I wish we could do more, but it’s a lot! OK, so we’re not a charity – it’s not all we do – but helping private sector companies is helping people. If anybody thinks the private sector is all about money, they have either not worked in it or worked in the wrong part.
I had colleagues who worked on our clients’ biggest move into offshore wind and their overall move into green. You can’t have one without the other. You can’t do the green work if you don’t understand how the sector works!
On diversity, I don’t know a law firm leader who isn’t genuinely passionate about it. I’m sure there are some who are not but the conversations I have – people aren’t faking it. We are being judged – rightly – between our aspirations and our outcomes.
I don’t mind being accountable for our outcomes. In inclusivity we’ve made a lot of progress, but if you look at our outcomes, there’s still further to go. In London, we are recruiting majority minority ethnic lawyers and the social mobility aspect of that group is going to look very progressive.
But let’s be honest – when we look at our ratio of black lawyers in London, it’s totally unacceptable. We’re not unique in that, but you have to be open about things you’re not right on. Frankly it’s reflective of society but we need to take a lead in changing it. There are black lawyers in teams who work with people who don’t get the challenges they face, and that is what we need to change.
The biggest lesson for me on inclusivity has been that the debate has to stop being about how we can ‘help’ certain minorities. We’ve got to fix the majority, and the outlook of the majority. Showing good people who don’t understand, what they need to understand, is the right thing to do.
LB: What are you most proud of and what do you most regret?
Palmer: I have tried to lead ambitiously and I have tried to really bring principle to everything we do. It’s not to say we were unprincipled, but to try and bring a consistency of principle. To try and stretch the experience so that people don’t have to work differently because of their unique experiences.
None of it have I done on my own! I am very proud we got our firm focused on stronger business performance. Deeper, more supportive client relationships. It goes back to purpose – and it is far more motivational to look at it that way.
I’ve had lots of very nice things said about me as my term ended… there were lots of much worse things said about me internally over the last six years! One of the things I’m proud of is almost all of them have said I’ve challenged assumptions.
What have I most loved? It’s given me two opportunities: one is the opportunity to meet thousands of people around the world, and I have loved that. It’s shown me that every time you meet someone, they’re interesting. We make assumptions about people we don’t know, including within the organisation. But it’s reinforced my enthusiasm of the human characteristics of everyone across the firm.
I get a huge buzz out of getting to say ‘thank you.’ The opportunity to make people feel proud of what they do, by saying thank you thoughtfully and recognising what they do, it’s an immense power to wield. It is a privilege. A total joy. I’ve also really enjoyed the times where someone has passionately ripped into me for things we were not doing well, because it’s someone talking truth!
I regret everything that I think is important today that I didn’t push harder for earlier. There are so many lessons – pushing outcomes harder, faster. What am I going to do about it now though? Other regrets are usually around not listening to someone enough. Not giving someone time who wanted it. Being too brief with somebody. Interrupting them.
I’d like to be remembered as not a handshake merchant. I’m a lawyer’s lawyer.
LB: Are you positive about the future of the firm?
Palmer: I’m really positive about it. I’m staying long term with the firm but I will keep out of leadership apart from diversity and wellbeing where I’ll still have a voice on these issues. I don’t think I’ll be undermining my successors to air my views. It’s a good time to hand on the baton. Change is good, it’s better to go before you’ve realised you’re stale. I’m not saying I’m not stale now, I just haven’t realised…
Justin and Rebecca (Sydney corporate partner Rebecca Maslen-Stannage succeeded Palmer as senior partner this year) will be a fantastic combination. I have huge respect for both of them. The others in our leadership team are people of values and ambition as well. We have staked out some ambitions for the firm around broader issues than clients and financials, which bodes very well for the future. The firm is committing itself to constant improvement.
To our clients, we are their first choice or one of. We’re not a price-positioning firm, we intend to be one of the world’s best law firms. We can be a lot better, and we will be. I am also optimistic about the sector. Through the focus on purpose and heightened social context, and through its competitiveness and desire to give great service, it is really well placed. LB