Freshfields' PEP exceeds £2m as revenue climbs to £1.7bn

Magic Circle UK firm maintains PEP lead over rivals as it points to US investment

Rick van Aerssen Image courtesy of Freshfields Bruckhaus Deringer

Freshfields Bruckhaus Deringer has unveiled what it characterises as a ‘strong’ performance with 7% revenue growth fuelling an 8% rise in profit per equity partner (PEP) to £2.07m.

After its sixth successive year of growth, turnover now stands at £1.7bn. The firm said its revenue increase was 10% if measured at constant exchange rates, which take into account currency fluctuations across its network.

Its performance is broadly in line with the two Magic Circle rivals which have already posted their results (see table) and allows it to maintain its status as having the highest PEP of the four global members of this grouping unless Linklaters, which is yet to report, can increase its PEP by 17%.

Freshfields managing partner Rick van Aerssen said: “We have delivered another robust set of results for the firm, reflecting our continued commitment to deliver for clients around the world. Despite tightening market conditions globally, I’m particularly delighted we’ve achieved a sixth consecutive year of revenue growth – underlining the strength of the firm’s long-term strategy and our teams’ understanding of where Freshfields can best add value.”

The UK Magic Circle 2022 Performance*Rev (£m)% ChangePEP (£k)% Change
Freshfields Bruckhaus Deringer1,7017%2,070k8%
Clifford Chance1,9698%2,040k10%
Allen & Overy1,94010%1,950k3%

*Linklaters is yet to post its results; Slaughter and May doesn't publish its results

Freshfields said it had performed strongly across all its regions and practice areas and singled out its development in the US. 

‘We bolstered our status as a top-tier US law firm in corporate transactions, corporate governance, regulatory and litigation - adding further expertise across major practice areas, six of which were Band 1 Chambers Global ranked,’ it added.

During the reporting period it doubled the size of its Silicon Valley office – launched in the summer of 2020 – to 34 lawyers and hired partner Damien Zoubek from Cravath Swaine & Moore in New York to co-chair its M&A and corporate alongside.

Klingsberg's hire from Cleary Gottlieb Steen & Hamilton in 2019 kick started the firm's drive to grow a heavyweight US corporate practice.

A strong year for M&A last year saw it muscle into the upper echelons of Refinitiv's 2021 global deal ranking by value alongside the usual US firms. At fourth place, it advised on 212 deals worth just short of $343bn, putting it well ahead of its next closest international rival Linklaters, at ninth place. It has largely maintained that momentum, albeit in a slowing market, slipping two slots to sixth in the H1 ranking

Read the Global Legal Post UK law firm financial results tracker

In today's results statement, however, the firm was keen to underline its progress on a range of ESG fronts. Almost half (48%) of the firm's new partners during the reporting period were women, surpassing the firm’s target of 40%. The firm’s 27-strong partnership round in April saw 11 (41%) women get the nod. 

The firm said that its number of black associates has increased by 67% and the proportion of its partners who identify as LBGTQ+ now stands at 4%, meaning it is closing on its 2026 global target of at least 5%. The firm also signed Greener Litigation and Greener Arbitration Pledges as part of its five-year environmental strategy.

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