PwC has plans to grow its legal services capability and promote to clients the obvious advantages of providing business and legal advice under one roof, after the Big Four accounting giant last week became the first of its direct competitors to secure alternative business structure (ABS) status from the Solicitors Regulation Authority (SRA).
The firm announced on 31 January that it had received authorisation from the SRA to convert to an ABS, enabling it to own PwC Legal and consolidate its global network of over 2,000 lawyers, working in a far more joined up fashion with its legal arm.
While the granting of the ABS comes with a host of conditions and client protections from the SRA, it gives the global accountant a waiver to conduct ‘prohibited separate business activities, and to enable the managers of PwC LLP to actively participate in prohibited separate business activities’, with one proviso being that clients are informed and give their consent from the outset.
According to Shirley Brookes (pictured), PwC Legal’s UK senior partner, who assumed that role following a reshuffle in October that saw Leon Flavell appointed to head up PwC’s global legal services network, obtaining the ABS status was time consuming but ‘very straight forward.’
The former managing partner of PwC Legal said: ‘PWC will be able to become a member in PwC Legal so in due course we will have that investment and look to expand the services that we currently provide to clients, which are complimentary to PWC.’
PwC will be looking at new areas of growth and Brookes added: ‘It will make clients maybe a little more broad minded about where they buy legal services from, and look at routes other than the traditional ones. As a joined-up project, the client has the benefits of going to an organisation with all of those offerings under one roof.’
The moves comes after PwC Legal unveiled a 9% increase in revenue to £40.5m from £37m, alongside a 14.5% dip in profit to £9.1m from £10.7m, its 2012/13 UK LLP accounts at Companies House show.
Staff costs rose 15% from £13.4m to £15.8m while at the PwC Legal group (which includes the LLP and its subsidiary undertakings) the average monthly number of employees rose from 175 in 2012 to 191 at the end of June 2013.
The firm has not ruled out further growth and Brookes told Legal Business: ‘We’re always looking at hires and have our eye on the market for good people. We’ll continue to invest in our growth areas and carry on with our strategy.’
Salaries in the group, including termination benefits of £227,000, rose to £13.6m from £11.6m.
PwC Legal’s £1m loan remains static compared with the 2011/12 financial year, having been taken out in July 2006 and renegotiated in July 2012.
The LLP currently has the option of a £4m overdraft facility, of which £1m has currently been drawn down. The loan facility is available for five years.