Magic Circle (law firms)
The Magic Circle is an informal term used to describe collectively what are considered to be either the five, or possibly six, leading London-based law firms, all of which employ primarily solicitors. It is also used as a term to describe the top four Commercial Chambers at the Bar. The members of the Magic Circle are:[1]
As of 2006 the first four listed above were in the top seven largest law firms in the world by revenue (in 2006 Clifford Chance became the world's highest-grossing law firm).[2]
Slaughter and May only ranked 35th in the world on this measure, but it has consistently enjoyed the highest profits per equity partner of the Magic Circle for a number of years. In August 2007, the Evening Standard reported that the firm was the 2nd most profitable large firm in the world. Surveys by American business website Vault.com in 2006, 2007 and 2008 ranked Slaughter and May to be the most prestigious law firm to work for in the United Kingdom.
One reason for the difference in turnover and profitability rests in the distinctive international strategy taken by Slaughter and May from the rest of the Magic Circle, which prefers to maintain its international capability by relying on a network of so-called "Best Friends", members of which typically are leading independent law firms in the relevant jurisdiction. This allows Slaughter and May to enjoy a higher profitability at the expense of a lower turnover compared to the rest of the Magic Circle, which has instead expanded aggressively by establishing many overseas offices.
Legal Business magazine includes a sixth firm, Herbert Smith, in its definition of the Magic Circle. The same publication attempted in 2007 to define quantitatively what it means to be a member of the Magic Circle. The feature was a Legal Business cover story and looked at the six firms' performance in recent years in terms of revenues, profitability, M&A work, litigation experience and capital markets mandates.
These firms are generally ranked amongst league tables as the most prestigious firms by other solicitors in England and Wales, and have the highest earnings per-partner and per-lawyer in the United Kingdom. Arguably however, their dominance of the London legal market has been challenged in recent years by American "big law" firms operating branch offices in London, which have a significantly smaller turnover but tend to pay larger salaries.[3]
The Bar
The following four Chambers are considered the Bar's Magic Circle [4]
Related phrases
- Global Quartet or Big Four, referring to members of the Magic Circle other than Slaughter and May as it has, in general, not pursued a policy of expansion
- Golden Circle, a term used for example, by The Economist, or Silver Circle coined by The Lawyer magazine in 2005 to describe mid-market or boutique law firms in the UK with profits per partner levels similar to those of the Magic Circle but being much smaller in terms of overall turnover and numbers of lawyers
- White shoe firms or Charmed Circle, referring to law firms perceived to be the leading New York City law firms
- Seven Sisters, referring to the seven Canadian law firms considered to be the top tier
- Big Six, referring to six Australian law firms perceived to be of the top tier
See also
References
- ^ LawBritannia Legal Glossary: Online UK Law Careers Counselling
- ^ The Lawyer Global 100 from The Lawyer published in association with The American Lawyer in November 2006
- ^ RollOnFriday's Inside Info on pay at London law firms
- ^ Set for a fight - 26 June 2000