Mr D’Agostino said it was also directed to “what’s keeping GCs [general counsel] up at night, and particularly in the risk-regulation space”.
“These are all conversations that I think we’re having in the boardroom and that are keeping boards interested – and awake at night.”
In an interview with The Australian Financial Review this week, Mr D’Agostino said headwinds were emerging after about three years of “perfect storm” conditions for law firms.
Moving when people are ready
He said the firm was embarking on a six-month project to assess the impact of the coronavirus pandemic, “to really get under the skin of what has changed over this past two years”.
Mr D’Agostino said the social contract had changed and HSF wanted to “re-evaluate our employee value proposition”. Part of that was ensuring staff were not unduly held back in being promoted to partner.
“I’m very clear. I would like to see people promoted into the partnership sooner than has been historically the position,” he said.
“We’re losing a few of those golden years when people are ready. They’re hungry. They’ve had all the training, they’ve got the clients and they’re ready to go out to market as a partner.
“If you leave it too long, you’re losing some of those years when people are really hungry and have got that energy to kick. Or you can lose them; they could go somewhere else.”
Mr D’Agostino said that “historically, there has been a bit of a cab-rank rule; the next most senior person was promoted”.
“People are now promoted when the business case is ripe, and when they are ready.”
He said his board asked whether the firm was “lowering the bar” because of market pressures that had seen wages rise by 10 per cent and mid-career lawyers in huge demand.
“I said ‘absolutely not’. It’s the opposite … the bar has never been higher.
“I’m pleased at the change.”
Change to social contract
Mr D’Agostino said he had “never seen a war for talent like this – and it’s in every one of our major markets”.
“Demand is so strong that we need more people … it’s at levels I’ve never seen before.”
He said the firm survey would be finished by October, but suggested the social contract between an employer and its staff had fundamentally changed during COVID-19.
“People want to work differently. They want to have much more flexibility. People’s personal lives have changed, as well as their professional lives. People are assessing a whole lot of things in their lives … as young mums and dads … as caregivers to elderly people in their family.
“It’s [a case of] ‘I put all this effort into your firm, what are you going to give back to me’.”
Mr D’Agostino, who is based in Hong Kong, noted that Asia was expected to deliver 60 per cent of the world’s economic growth by 2030.
“We very much see Australia and Asia joined up, operating as one powerhouse.”
There were no signs that the “once in a generation M&A [mergers and acquisitions] boom” was slowing down because of the amount of capital still looking for a home.
However, there were “slightly more nerves creeping in” about the fiscal outlook for firms, with the war in Ukraine causing some to “take stock”.
“There are headwinds. If you look back 12 months, even though we were in the middle of a pandemic, there were very strong tailwinds. Demand was high…
“You start 2022 with a slightly different landscape. And I think those headwinds are something we need to all keep an eye on, and they are interest rates, inflation, geopolitical tensions, cost of living generally.
“We’re not seeing that coming through very strongly at the moment; demand remains really strong, and the pipeline [of work] is very strong.”
The new partners in Australia, along with their home city and specialty, are: patrick clarkMelbourne, competition; Rachel Dawson, Perth, employment/industrial relations; Wendy FauvelBrisbane, employment/industrial relations; Mark HatfullPerth, corporate (energy and resources); Nerida JessupSydney, work, health and safety; Jason JordanMelbourne, corporate/M&HAS; Olga KlimczakPerth, employment/industrial relations; Alex MackinnonMelbourne, corporate (equity capital markets); Niresha Mudalige, Melbourne, real estate; and Aoife XuerebMelbourne, commercial litigation/class actions.
Another global firm, Ashurst, announced 25 new partners last Friday, with 12 based in Australia.
They are Nathan Bellgrove, Ashurst Advance, Sydney; Samantha Carrollfinance regulatory, Brisbane; Laura Hillhousetransportation and infrastructure, Sydney; Campbell JohnsonGlobal Loans, Melbourne; Joanna LawrenceIP/media, Melbourne; Tamara Lutveyemployment, Brisbane; Gwladys Ngo Tedga YaglaAshurst Risk Advisory, Melbourne; Morgan Spaindispute resolution, Melbourne; Thomas Storerdispute resolution, Sydney; Steve Whittingtontaxes, Sydney; Matthew Worsfold, Ashurst Risk Advisory, Sydney; and Melissa Yeodispute resolution, Brisbane.