Kirkland & Ellis: Are Its Profits Per Equity Partner Irritating Clients?

Kirkland & Ellis, the largest and most profitable law firm, has made this bombshell announcement: It will no longer disclose to media details of its financial performance. So, the legal and business worlds now wonder if other highly profitable law firms will also go silent about those kinds of metrics.

K&E offered no explanations why. It only stated that such quantitative details provide no meaningful insight about the quality of its services. 

Well, well. One source to Bloomberg Law made this observation:

"The decision had been in the works for multiple years, according to two people. One of the people said firm leaders were wary of client response to reporting on the firm’s equity partner profits, which were $11 million in its latest reporting."

Also for years the K&E model has been imitated by other law firms eager to boost their own Profits Per Equity Partner. So. it's not unthinkable that Paul, Weiss, for example, which seems to have grafted on pieces of that model, could also decide to no longer be transparent about PPEP and other financial matters. 

According to Law.com, that average PPEP at PW is $8.631 million. It's been estimated that Scott Barshay is pulling down each year $15 million to $30 million. Surely, when that kind of information is released or even suspected clients don't cheer. Sure, PW partners like Barshay do a good job. But such a number can nudge a client to search for a lower-cost alternate provider.

In coaching, I warn clients not to showcase success in over-the-top material ways. Could Neel Sachdev's flamboyant lifestyle over at PW's London office trigger any client churn? Sachdev tools around in a 1977 red Mercedes. 

Careers. Forget all that. It’s about earning a good living, no matter what.

Complimentary consultation with Jane Genova, StreetSmart Coaching (janegenova374@gmail.com)


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