Barclays has introduced a new threshold for relationship accounts and has increased the trigger point for its policy to tender work from £25,000 to £100,000 after a feedback exercise during its last panel review, it has emerged.
The relationship account system, which was introduced in 2014, works by giving firms an annual value of free legal services they must provide in return for volume of work – primarily through legal advice and secondments.
The system previously applied to Barclays’ list of preferred advisers, but is now triggered by a volume of work over £1m. According to Barclays’ head of commercial management, Stéphanie Hamon, every law firm, irrespective of their category as a panel firm, a core specialist firm or a specialist firm, must contribute when they reach that threshold.
Speaking to Legal Business, Hamon said: ‘The relationship account was actually something law firms wanted us to keep. We were pleasantly surprised by that. It is presented in a way in which you have all of the investments and relationships organised in one place and it has a value attached to it.’
In addition, Barclays has increased the trigger for its policy to tender following a feedback exercise with its law firms. In the spirit of improving relationships, the trigger amount has risen from £25,000 to £100,000. This means that every piece of work over £100,000 will still need to be bid on by the bank’s panel law firms. The bank will also be carrying out six monthly reviews of its law firms to make it easier to review the firms at the end of the two year panel term.
Hamon added: ‘There always was a policy to tender, but as part of a feedback exercise we discovered that our threshold was too low, and so we raised that threshold above a certain amount.’
Barclays finalised its global panel in June this year following months of speculation. A raft of firms including Clifford Chance, Ashurst, Eversheds, Mayer Brown, Reed Smith, Simmons & Simmons, Hogan Lovells, Pinsent Masons, DWF and Bond Dickinson won places on the bank’s reduced roster, however DLA Piper lost its spot. It is believed that the total number on the bank’s roster is around a third of the previous total of 350 – 400 firms
According to one law firm partner the key themes of the panel review were ‘delivering excellence, thought leadership, collaboration, team work and value for money.’
The bank also asked some firms to price work according to a different rates for strategic work, medium and flow, covering everything from high end mandates to process driven work.