The possibility of demoting some members of the firm’s equity partnership down to a fixed share will be discussed today at a meeting on Shearman & Sterling’s global and regional managers in New York, according to anonymous tipsters from inside the firm. If approved, the de-equitization could take place during the firm’s annual compensation period next January. Despite the reports, Shearman & Sterling has thus far denied plans to trim back its equity partnership, saying only that the firm ‘regularly [reviews] how and where we invest equity and manage headcount.’ As such, it is not yet known how many equity partners could be affected by the plan should it be approved.
Asia and US partners
According to the AmLaw 100, Shearman & Sterling had 162 equity partners in 2015 as well as 26 fixed share partners. One internal source told Legal Week that equity partners in less profitable regions and practice areas will be the likely targets of the cull if approved by the firm’s management: ‘It wouldn’t surprise me if Asia or the US were affected by any changes. I don’t think it’s any secret that most firms struggle to make money in Asia unless their partners are on some sort of salaried structure,’ said the source, who is a current partner at the firm.
Sources: Legal Week; American Lawyer
Email your news and story ideas to: [email protected]
