Legal Business

Sponsored Q&A: Osborne Clarke

1. Can you describe the current legal framework governing renewable energy in Germany and any significant regulatory developments that have occurred in the last year?

In a nutshell, the legal framework for renewable energy in Germany consists of a priority grid connection claim and support via the Erneuerbare-Energien-Gesetz (EEG) feed-in tariff for smaller installations and the market premium for larger installations. The market premium is paid by the grid operator and compensates for the difference between a bid awarded in a tender and the market prices.

Legal Business

Osborne Clarke launches international arbitration offering in Miami

Osborne Clarke has announced the launch of its third US office in Miami, adding to its existing offerings in San Francisco and New York. According to the firm, the opening of its Miami practice is the latest phase in its US and international arbitration strategies.

OC has appointed the former managing partner of Bird & Bird Spain and IT, data law and international dispute resolution specialist, Javier Fernández-Samaniego, from his own firm Samaniego Law as its managing partner and sole practitioner. He is well acquainted with the Florida, Latin America, and Spanish legal markets, having run Samaniego Law offices in both Madrid and Miami over the past seven years.

OC’s international CEO, Omar Al-Nuaimi, said: ‘We continue to invest in our deep international expertise to support the needs of our US client base. Opening in Miami presents a very exciting opportunity for the firm, given it’s a fast-growing hub for international arbitration and tech law.’

Co-managing partner of the firm’s Spanish operation, Jordi Casas, added: ‘Our links with the US and Latin America are an important part of what makes our Spanish offering so special, and central to growing our business. It’s great to announce that those links are about to get even stronger with our new office in Miami.’

Asked about its hiring strategy for Miami, a spokesperson for the firm said: ‘To clarify, we don’t practise US law. Our US team provides clients with in-time zone advice on international legal needs across M&A, disputes, investments, employment, compliance or other regulatory/commercial advice. We plan to focus on integrating the Samaniego clients and don’t have any specific targets to grow our Miami team immediately.’

On whether the Miami practice has any plans on expanding into other practice areas beyond arbitration and technology, the firm confirmed it does not, but will be able to ‘tap into our European network for support across all areas as needed’.

With the opening in Miami, OC now has 18 practitioners in its US team.

ayesha.ellis@legalease.co.uk

Legal Business

‘It would be remarkable for us to deliver 20% growth’: Turnover still up at Osborne Clarke following last year’s outstanding performance

Osborne Clarke has kicked off this year’s financial reporting season, revealing a 9% international revenue increase from €407m in 2022 to €442m in 2023, which the firm sees as real progress against the backdrop of weaker global economic conditions and a stagnant deals market.

In the UK, the firm’s income also grew by 9% from £199.1m in 2022 to £217.3m, which is a notable contrast to last year’s revenue increase of 19% and 20% respectively for international and domestic growth, and an indicator of the obstacles that many firms are facing.

And, although OC’s international revenue is up, its UK net profit has decreased slightly from £77.2m to £74.7m. That means PEP was down 14%  to £687k, compared to last year’s £796k, which was an 11% increase on 2021.

Speaking to Legal Business, UK managing partner, Conrad Davies (pictured), said: ‘We were expecting more growth in 2022 but we had a difficult second half of the year, which was reflective of the rest of the market. We remain a firm with a heavy transactional element. Market conditions dipped last year in corporate, real estate and finance, thanks to the economy, the Autumn Budget, inflation, Ukraine, etc. It meant that the transactional market was not as good as we expected it to be. However, we saw an uptick in trading by the end of our financial year.’

Asked about the deceleration of the rate of growth from 20% in 2022, to 9% in 2021, Davies responded: ‘It would be remarkable for a firm our size to deliver a 20% growth year on year. Double-digit growth is our goal, which I would expect when we look at the next 2-3 years to deliver.’

Davies discussed the firm’s highest-performing areas and its lateral hiring strategy: ‘We have had a strong year in our disputes team, which we have bolstered from a sector perspective through the hiring of Trevor Crosse [from Marks & Clerk] in life sciences. Data is also one of our key strategic areas of growth, which we have strengthened by hiring data protection partner Jonathan McDonald [from Charles Russell Speechlys].’

He added: ‘Disputes is fabulous; you would expect it to be strong, but it has well outperformed our expectations. The tax and pensions team have also done well. But we are a heavily transactions-based firm, and we are hoping to see those teams come out strong in the Autumn.’

Osborne Clarke’s 2023 financial results also reveal adjustments to its remuneration structure, with an increase in long-service awards, ranging from £2,000 for a ten-year anniversary, to £10,000 for 50 years, as well as introducing a discretionary long-term incentive plan with up to 40% of individual salaries paid as bonuses over three years, based on high performance.

Davies said: ‘These adjustments reward long service and loyalty to the business, building upon our strategy and making sure that people are delivering excellence that is rewarded and enhanced.’

Last year, in recognition of the firm’s outstanding financial performance, all UK staff were given a 5% profit share bonus based on annual salaries, with a minimum payment of £2,500, while individual performance-based cash bonuses were increased to 25% of base salaries. However, this year the staff bonus has been dropped to 4%, with a minimum payment of £2,000.

Davies commented: ‘What we could have done was said, “Okay, we have had a difficult year, we are not giving a staff bonus,” but we are really pleased to commit to the 4% level and the £2,000 minimum payment.’

Ayesha.ellis@legalease.co.uk

Legal Business

OC’s departing UK leader Berg seeks westward expansion in American voyage

Less than two months after handing over the UK managing partner reins, Osborne Clarke’s (OC) Ray Berg is set for America to boost the firm’s stateside expansion strategy.

The clubbable Berg (pictured) is to take up a ‘senior business development role’ in San Francisco in January, and will work closely with the team, led by US managing partner Steve Wilson.

According to OC, Berg’s role will be ‘focused on developing opportunities and managing relationships with US clients and deepening relationships with key intermediaries.’

Berg told Legal Business: ‘When I first qualified I spent two years in the US, so I know the team well and the great opportunities over there. In terms of our transformation themes as a wider firm, digitalisation and decarbonisation for example, so much of that is coming from the west coast.

‘Those transformation drivers and our sector expertise give us an opportunity to play in that market – particularly in California. Frankly, the dollar is particularly strong against the pound and euro right now as well, so we want to capitalise on that outbound corporate activity.’

The move comes amid accelerated American investment at OC – the firm claims it has doubled its team on the ground over the last 18 months, now comprising 16 lawyers. Such is the scale of the expansion, the firm is planning to move to larger New York premises in 2023 to accommodate the additional headcount. Berg noted that OC hopes to further double its US headcount within the next 18 months.

Wilson underlined the ambitions: ‘Ray’s move is another developmental milestone for Osborne Clarke in the US as our strategy moves up a gear and we expand the expertise and experience of our on the ground team. We’ll be announcing further new colleagues over the coming months and looking forward to ensuring their smooth integration continues to drive success in our chosen US markets.’

OC has been present in the US market for over 22 years, with offices in San Francisco and New York. Typically, the firm advises fast-growth enterprises, start-ups and ‘many of the world’s leading companies’ on their overseas legal needs. The OC team in the US provides a full service, spanning M&A, dispute resolution, investments, employment, compliance and other regulatory or commercial advice.

The news caps an eventful year for Berg. In November, mere weeks after being named Legal Business’s Management Partner of the Year, it was announced he was being replaced as OC’s UK leader by corporate partner Conrad Davies.

Berg concluded: ‘I’ve had a fantastic time as UK managing partner, and it’s so great to be able to move into another meaningful role. People were asking me if I was going to retire – no chance! Still got lots to give, and in fact I’ve been given some significant targets.’

tom.baker@legalease.co.uk

Legal Business

‘I’ll do it my way’: OC elects Davies as UK leader, replacing much-admired Berg

Mere weeks after being declared Management Partner of the Year at the Legal Business Awards, Osborne Clarke (OC) has today (19 October) announced that longstanding UK leader Ray Berg is being replaced by corporate partner Conrad Davies.

Davies, who is also international head of OC’s urban dynamics group, will assume the position of UK managing partner on 1st January 2023 after being elected by the firm’s partnership.

He has spent over 17 years at OC since joining from Jones Day, becoming a partner in 2011. Since then, Davies helped establish the firm’s corporate real estate practice, and also led OC’s international real estate and infrastructure sector for seven years.  

Davies (pictured) told Legal Business:  ‘My key aim is to continue the business in Ray’s image, by keeping up our people commitments around pay and benefits to ensure Osborne Clarke is a firm people are proud to be part of.  

‘The way Ray connected with our people over the years has been absolutely fabulous. But he did it his way, and I will do things my way. He represented a great bunch of people behind him, and they are still here, so my job is to continue the great work of representing their interests.’  

In terms of immediate priorities, Davies said he would look to bring in a chief operating officer in the short-term ‘as there’s some leadership qualities to be brought to bear with that’, as well as ensuring the firm is well-equipped for potential macroeconomic headwinds. 

It brings to an end a successful eight-year term for Berg, who has been widely credited as playing a key role in OC’s recent financial and strategic success in the UK. In particular, he has been noted for his instrumental role in developing and leading OC’s five-year 2025 strategy investing in clients, people, ESG and business. On the financial front, Berg last year oversaw a 20% jump in UK-only turnover from £166.4m to £199.1m. 

Berg was popular with clients, many of whom turned out to support his Management Partner of the Year submission with strong testimonials. Richard Allen, general counsel and company secretary of Dialight, said of Berg: ‘As a client I have known Ray Berg for 20 years – first meeting him when he was a young partner in the OC corporate department. 

‘The attributes that meant I kept going back to him then are what I still see in him today: adaptability and pragmatism, an openness to new ideas and ways of doing business, and a refreshing lack of stuffiness; a clear-sighted commerciality, financial awareness and understanding of how business really ticks; a complete lack of pomposity – he wears his excellent intellect lightly; an easy-going and approachable style but not someone afraid to call out irrationality, muddle-headedness or poor behaviour; and, an intellectual and emotional awareness and integrity, which is sadly as rare as hens-teeth in the legal profession.’ 

For more on Berg’s life both inside and outside of law, read our 2017 Life During Law interview here.

tom.baker@legalease.co.uk  

Legal Business

Osborne Clarke adds over €60m to top line amid buoyant financials

Osborne Clarke (OC) has joined the slew of firms reporting robust financials, today (13 June) unveiling a 19% increase in overall turnover from €341m to €407m.

And in an endorsement of the UK market, domestic revenues jumped 20% from £166.4m to £199.1m. Profit per equity partner (PEP) also saw a notable increase, climbing 11% from £714,000 to £796,000.

The upturn in revenues outpaces last year’s showing, when the firm rallied after a tough Covid period to record a 7% international revenue increase, with an 8% rise in UK income.

Omar Al-Nuaimi (pictured), OC’s international chief executive, admitted he was ‘surprised’ by the level of growth. He attributed the growth to: ‘Investments paying off, which have enabled us to keep investing in lateral partners.’

The firm also conceded it was operating under ‘favourable’ market conditions, but nonetheless pointed to a new 30-strong team in Poland that boosted its European practice, increasing client relationships with its US platform and growing ‘aggressively through lateral hires’ globally.

In terms of lateral hiring highlights, OC welcomed energy partner Hugo Lidbetter from Fieldfisher and payments partner Paul Harris from Linklaters in January, and added three energy and utilities partners in John Deacon, Dominic O’Brien and Hannah Roscoe from Orrick in March. The firm also made eight partner promotions in the UK during the year, three of which were women.

Such concerted investment would explain the relative slowing of PEP increase – while this year’s 11% rise is immodest, it was bettered by last year’s 16% surge in PEP. Ray Berg, UK managing partner, told Legal Business: ‘PEP is a dark art! But the fact that we’ve managed a double-digit growth while making such investment is something we’re proud of.’

Berg reported that growth was across the board in terms of practice areas, which was backed up by the numbers. The firm’s ‘business transactions’ unit saw the highest rate of growth at 27%, underlining the general liveliness of transactional markets. Projects, real estate and finance grew at a similarly pacey 25%, the advisory practice increased 15% and disputes and risk was up by 8%.

In recognition of the strong performance, in June OC will be giving all its UK staff a 5% profit share bonus, based on annual salaries. The minimum payment will be £2,500, up from £1,500 last year. Performance bonus payments have also been increased to 25% of base salary.

Berg concluded: ‘Reward is closely tied to personal growth and well-being, so we’re looking at how we competitively reward our people. From transparent base pay and enhanced bonus payments, to recognition of long-serving employees and increased pensions contributions, we feel incentivising our top performers and valued employees is a big part of being a responsible business.’

Tom.baker@legalease.co.uk

Legal Business

‘Similar but different’: Osborne Clarke’s veteran senior partner Saul hands the baton to Clough

Having overseen a time of significant growth for Osborne Clarke, Andrew Saul (pictured) is making way for Peter Clough to take on the senior partner mantle.

OC announced today (Monday 11 October) that its partnership had elected Clough to take over the role for a four-year term on 1 January 2022, following on from Saul completing two terms.

Clough joined OC 25 years ago and was previously head of the firm’s Bristol office, a member of the partnership council and head of the disputes and risk practice group.

For his part, Saul went unopposed to be re-elected for his second four-year term in December 2017 on the back of an impressive run of growth, both financially and geographically.

OC’s most recent financials rallied in the face of last year’s Covid-hindered performance to record a 7% international revenue increase to €341m as UK profit and profit per equity partner (PEP) saw double-digit elevations for 2020/21.

OC’s UK showing also received a shot in the arm from last year when the firm posted a subdued 3% revenue increase to £155m from £150m, while UK net profit diminished by 5% to £59.8m from £63m.

In 2020/21, UK revenue increased by 8% to £166.4m, outstripping global performance, while UK net profit also saw a pacey 14% hike from £59.8m in 2019/20 to £67.9m. A 16% surge in PEP to £714,000 more than reversed last year’s 12% drop to £614,000, when significant investments in both its people and infrastructure and partner investments were cited as the reasons for the drop.

Talking to Legal Business, Clough said of his leadership style: ‘Andrew and I are similar but different. We’re both quite measured in our approach and reasonably calm. Andrew has always had an almost serene approach to the role and has been an absolute exemplar for how to do the role in a professional services firm really well.

‘One of my real passions is client relationships and development. I’m keen to use the senior partner platform as a way of helping our people with those relationships. I did promise yesterday in our partners’ meeting that I wouldn’t disappear off into a room and do only internal things! I’m really keen to remain client and market facing. We are lawyers, after all!’ He added that the official split between client-facing and leadership responsibilities was 50:50, however in practice the ratio was liable to change on a daily basis.

Clough said the plan would fundamentally be to continue the upward trajectory of a business he described as ‘absolutely flying’ despite an at times challenging market. He pointed to the 3D Strategy OC launched in the midst of the pandemic, geared towards helping clients in core sectors with issues relating to digitalisation, decarbonisation and urban dynamics. He said of the strategy: ‘It was part of our response to the pandemic and it’s been really successful in generating really interesting conversations. Decarbonisation is what all business needs to do now and it’s become a really hot topic. I can’t see that going backward, particularly given the rise in energy prices and the fact that ESG is on everyone’s corporate agenda these days. That’s been a really interesting journey and we’re very optimistic that the strategy will help us take the firm onto new heights.’

Clough ended by being sanguine on the market outlook: ‘At the beginning of the pandemic if you’d ask us how the year would pan out, we wouldn’t have said anywhere near as good as it did. We’re still trading at really good levels and have been for months.

‘We’ve had 12 consecutive fantastic months and, touch wood, there is no current sign of that changing. You’d have taken that at the beginning of April 2020, wouldn’t you?’

nathalie.tidman@legalease.co.uk

Legal Business

Financials 2020/21: Osborne Clarke shows spirit with 7% revenue growth and double-digit profit surge

Osborne Clarke has rallied in the face of last year’s Covid-hindered financials to record a 7% international revenue increase to €341m as UK profit and profit per equity partner (PEP) saw double-digit elevations for 2020/21.

The global revenue increase from last year’s €318m means turnover has grown a respectable 55% over five years. OC’s UK showing has also received a shot in the arm from last year when the firm posted a subdued 3% revenue increase to £155m from £150m, while UK net profit diminished by 5% to £59.8m from £63m.

In 2020/21, UK revenue increased by 8% to £166.4m, outstripping global performance, while UK net profit saw a pacey 14% hike from £59.8m in 2019/20 to £67.9m.

A 16% surge in PEP to £714,000 more than reversed last year’s 12% drop to £614,000, when significant investments in both its people and infrastructure and partner investments were cited as the reasons for the drop. OC said it continued to strengthen its financial stability with increasing cash resources to £41.1m, up 14% on 2019/20.

Ray Berg, UK managing partner (pictured), paid tribute to the firm’s people, supporting clients, colleagues and the business through one of the most volatile periods it had ever experienced and a year that has been ‘mentally taxing’.

Speaking to Legal Business, Berg was cautiously sanguine: ‘Everyone in the business has worked flat out and there’s a huge sense of fatigue, but to see the way people have responded in a true OC manner, bringing out the best in our values, has just been fantastic. I’m not going to deny, this is a great set of numbers, but they’re almost secondary when you consider where we were a year ago and the huge uncertainty facing the business and our people.’

Omar Al-Nuaimi, OC’s International CEO, pointed to a number of highlights since the introduction of OC’s 2020 strategy, including 9% year-on-year growth in the international business since 2015/16 and increasing multijurisdictional clients – those served in five or more jurisdictions – by 83%. OC has also now passed 2,000 people internationally. ‘We’re proud of our innovative reputation and we plan to keep that spirit alive with a shared vision going forward,’ he said.

At the start of the year, Osborne Clarke launched a new future-focused three dimensional client plan that combines legal expertise, sector understanding and transformational insight across three international drivers of change: decarbonisation, digitalisation and urban dynamics. Berg pointed to the hire of the firm’s first head of inclusion and corporate responsibility, Bola Gibson, as a key development, along with the pandemic’s role in crystallising the importance of such issues. ‘I’ve always said that diversity and inclusion, including wellbeing, would be one of the things our clients and our people measured us on. If ever anyone needed convincing of the business imperative of that, the last 12 months have proved it. Equally, decarbonisation and showing you’re a sustainable business. You’ve got to have an answer that goes beyond the tick box response and it’s genuinely embedded to what you do as a firm.’

The firm’s largest sector, technology, media and communications grew 21%, followed by retail and consumer increasing by 16%, energy and utilities up 8%, financial services up 7%, while other sectors were broadly flat but against strong performances in 2019/20.

In the UK, disputes and risk saw 14% growth, business transactions increased by 9%, projects, real estate and finance grew 3% and advisory by 2%.

Notable UK laterals for the year include that of London real estate partner Richard Wilkinson from DLA Piper; Michelmores London restructuring and insolvency partner Douglas Hawthorn; Tim Harris, patent litigation partner from Bird & Bird, and technology and life sciences-focused venture capital partners – Rob Hayes and Justin Starling – who joined in Reading along with their team from Penningtons Manches Cooper. The firm also promoted 12 international partners in the last year.

Berg noted that, while the economic indicators for the firm and its clients appear positive, other significant challenges could potentially cloud the horizon.

‘If I’ve got one concern it’s the personal impact this has had on everyone. We won’t really know the extent of that for a few months to come. On one level, remote working has been great because we’ve seen a backdrop to every individual’s personal life we would never have seen before, but equally you get a certain picture with a virtual veneer, which makes it harder to really understand what people are dealing with.

‘Layer onto that the war for talent, which is really going to have to make law firms be very clear on what they are about. If people are stuck at home who joined OC because of its wonderful culture that they’re not physically experiencing, the lure of a huge US salary becomes a very attractive proposition. That goes back to making people want to come into the office.’

nathalie.tidman@legalease.co.uk

Legal Business

Life During Law: Simon Beswick

I’m one of three brothers. My middle brother David has just retired as partner of Eversheds. Ever since we were young lads he wanted to be a lawyer, so I had that echo going on.

I chose economics, accountancy, politics and law at A-Level. I really enjoyed the politics but also found the law a lot more interesting than the accountancy. I decided off the back of that to do law at uni and that carried on into a career. I believed I’d be a lawyer for no more than two or three years, and use it as a stepping stone to go into business.