After a long year of denigrating major Australian corporate firms we thought it apt, at this festive time of year, to reverse the trend and pay homage to one firm whose conduct over the preceding year is worthy of recognition.

A round-table Firm Spy discussion was held to discuss this award (we’re giving it the fancy name “Firm Spy Corporate Firm of the Year”) and we’ve settled on Freehills. The firm has acted with considerable integrity over the last year and for a variety of reasons is deserving of this prestigious award. Yes, we’re being serious.

excellence is a habit

But before we delve into this positive stuff, let’s pause for a moment to look at what nincompoop Freehills managing partner and chief executive Gavin Bell said recently in an interview with BRW (26/11):

What is the best piece of advice you have received?

Sitting in a meeting room in Mumbai, I saw a quote from Aristotle: “You are what you do. In this sense, excellent is a habit, not a series of acts”.

A lesson you’ve never forgotten?

Don’t take your clients for granted.

How do you achieve work-life balance?

I don’t see it as an either/or proposition. Work is part of life. You need to enjoy your work. If you don’t, you will probably never achieve balance.

So on this “balanced” view you have of the world, Gav, life’s major lesson involves corporate clients and your guiding ethos, scribbled on a decaying Indian scripture, is to be “excellent” at all costs?

And what about those comments from Freehills partner Tony Woods in last week’s AFR (9/12)?

Freehills partner Tony Woods said employers had become more cautious about their legal risks from Christmas parties over the past five years and this year there was a focus on responsible drinking and monitoring employees at parties to check who was drinking too much.

“The days of unlimited beer and wine on the table are over,” he said.

These comments are at odds with our report in July that Freehills had been luring seasonal clerks with booze-fuelled parties. We quoted an ex-Freehills seasonal clerk who said:

the life of a summer clerk is about much more than research file notes, reviewing documents and client conferences. Summer is the peak period in the social calendar of law firms, with lavish practice group and firm-wide Christmas parties for [sic] to enjoy. Freehills also puts on … weekly Friday night drinks. [T]here are plenty of inter-firm clerk events, including weekly drinks … a cruise and a day at the races…

Woodsy, it doesn’t sound to us like the days of guzzling unlimted grog are over!

But alas, we’re here to award a prize and despite the familiar corporate nonsense reported above, a very deserving recipient is Freehills.

Freehills has taken a consistently measured, moderate approach over the course of a tortuous last year. The firm has not implemented a major redundancy program (AAR, Mallesons, Blake Dawson and Minter Ellison have all reduced headcount significantly since the outset of the GFC). And, unlike (in our opinion) its other major competitor Clayton Utz, when it’s media man Gavin Bell told the AFR last week that Freehills “took the view that we were going to retain people, that we were not going to lay off people, that that was a last resort”, it is actually truth. Recall the “Claytons Redundancies”?

Instead, we’re informed that the firm took the unique approach of managing staff levels by seconding an inordinate number of staff to clients, sometimes at cost. The partners therefore took a financial hit. But in the process, they fostered a deeper relationship with clients, kept staff happy with a chilled-out few months in another office, and will be able to respond to the upward trend without recourse to recruitment agencies (who charge a premium for their services).

The innovative means by which Freehills has proactively sought to retain staff is also witnessed in its development of the “executive counsel” role: a kind of pit-stop before partnership. Whereas we’re told Mallesons knocked on the door of many of its senior associates at the time of its voluntary redundancy scheme and informed them that partnership was a very distant prospect, Freehills created a new role to keep staff happy and motivated. Yes, we maligned the “executive counsel” role at the time of its introduction, but now viewed in the context of the Freehills’ conduct over the year it is clear that the firm was seeking to be innovative and to promote staff retention. Freehills was also transparent at the time about the need to maintain the value of equity points (which initially elicited our angry post).

But more than its novel, transparent approach to managing and staff, Freehills has been the first to act on pay. It is to be emphatically commended for this because, we believe, each of the other firms have been waiting for a major competitor to act before they themselves swing into action. Look at Blake Dawson for example: presently rumoured to be a whopping 20% over budget. Freehills has been transparent about its process and has had the integrity to frame its decision-making with reference to partner profit (we will share the money if partners make more money, but wont if they don’t). We haven’t seen another firm couch the pay freeze in these terms. Honesty is a wonderful thing, even if it comes from the mouths of disgustingly rich partners who are deliberating over whether their preference is for $1,500,000.00 or $1,475,000.00 this financial year.

So Mr Gavin Bell and Team Freehills, this has been an excellent adventure. The Firm Spy commends you for acting with the least disregard for employees and their interests of the major corporates in 2009. The award and the glory is yours.

An infinitely wise Greek fellow once said to me after taking a major toke of some prehistoric herb - “you are what you do. In this sense, excellent is a habit, not a series of acts”. Let’s hope we haven’t just seen a series of acts.

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