Indian law firms face leadership challenges
Livemint has published this interesting article on the leadership challenges faced by Indian law firms. While most law firms around the world are run as pure democracies with each partner having a vote when it comes time to choose leaders, many Indian firms – which are considerably younger than their US and UK counterparts – retain considerable power for founding members and their families.
Amarchand and Mangaldas and Suresh A. Shroff and Co, for example, has scaled back the percentage of the firm owned by the Shroff family, but maintains a vision for the firm in which the family retains a large role.
The model presents some problems, as partners who rightly see themselves as a firm’s main revenue source and brand perceive threats to their ego and ambition in a leadership structure that elevates founding partners. And succession planning is also a burden - Mumbai technology specialist firm Thakker & Thakker closed shop entirely on 50 lawyers when the founding partner decided to retire and pursue philanthropic projects in late 2010, and at Amarchand the next generation of Shroffs still too young to for anyone to say whether they will be able to take up where their parents leave off.
Another Indian firm that faces the same problem are Luthra and Luthra Law Offices, which announced a wider equity-sharing model almost three years ago, but has still not implemented it. Meanwhile, Trilegal converted to a lockstep equity model in 2007.
There are advantages to running a law firm in the dictatorial mode. Less time is wasted on partnership politics and decision-making can be fast. Amarchand’s Cyril Shroff opined that the model also promotes entrepreneurship and other benefits arising from the fact that the leadership has a long-term commitment to the fate of the firm.
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