Environmental, Social and Governance; Diversity, Equity and Inclusion. The labels have lengthened. Voguish causes and preoccupations that public- and client-facing corporate behemoths know will burnish their reputations. Flashing beacons of virtue. The whole ‘woke’ panoply.
If years as a City journalist taught me anything, it is that profits trump the lot. Pun intended. (Unless the law itself gets in the way, as with equalities legislation.)
I once overheard the head of a magic circle firm complain that he couldn’t sack his entire HR team. They were a ‘drain’ on entrepreneurialism and the bottom line. Corporate PR is one thing. What do senior executives really think? Not always what you think they ought to think.
And so it is with the US president’s war on Big Law. A week ago, over 80 former Skadden employees wrote to the firm expressing ‘deep outrage’ over its decision to reach an agreement with Trump in order to avoid an executive order punishing the firm. Skadden will commit at least $100m in services to causes the president supports. Skadden will also desist from race-based hiring.
Other firms have cut similar deals, or are expected to do so.
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Shocking?
Yes and no. Big Law is, by definition, disinterested – and closer in its business model to investment banking, as a former Ashurst senior partner told the Financial Times this week. More pertinently, it is one of the most profitable enterprises in the history of capitalism.
Do they truly expect equity partners earning multi-millions to die on Capitol Hill over their firm’s DEI policies? Many – maybe even most – will have voted for Trump. Why is it assumed they must somehow be liberals?
Big Law’s alleged ‘surrender’ is certainly regrettable. And dangerous. But also understandable, even pragmatic. Paul, Weiss noted that had it not also caved to Trump the firm ‘could easily have been destroyed’. Competitors were waiting to scavenge.
Am I too cynical? Maybe. Big Law’s best defence is strength in numbers. Belatedly, this seems to have been recognised. Over 500 firms signed a court brief denouncing Trump’s targeting of Perkins Coie, many Big Law outfits among them. Not all, though, which is unfortunate. Like all good populists, Donald Trump knows how to divide and rule.
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