Stats Of The Week: Biglaw Bosses Are Old

Is there a looming demographic crisis in Biglaw?

onNovember 6, 2015 at 3:57 PMNovember 10, 2015 at 6:31 PM

A Biglaw analogue to the 31-year-old Mark Zuckerberg (or even the 32-year-old Martin Shkreli) is inconceivable: the law firm model is premised on a slow and arduous climb up the ladder to partnership by a select few. None of this disruptive wunderkind stuff for the legal profession, where the Boomers are firmly entrenched at the top and give no sign of relinquishing power. 97 of the Am Law 100 firms are led by someone born before 1965. Arguably, the current generation of law firm leadership has done all they can to pull that “ladder to partnership” up behind them, with a decrease in the proportion of equity partnerships and jacked-up leverage ratios.

According to a just published study by legal industry consultants Altman Weil, “in 63% of law firms, partners aged 60 or older control at least one quarter of total firm revenue, but only 31% of law firms have a formal succession planning process.” Is there a looming demographic crisis in Biglaw? Law firm consultant (and proprietor ofAdam Smith Esq.) Bruce MacEwen thinks there might be. Quoted in a New York Times DealBook piece on the “graying” of law firms, MacEwen predicts that “[w]hen the baton is being passed, that may be the time when there are firm breakups with people going different ways.”