Nate DiMeo of American Public Media recently reported on the Australian law firm Slater & Gordon becoming the first publicly traded law firm in the world. Managing partner Andrew Grech explained that the typical partnership model stopped working for Slater. They had a hard time convincing talented young lawyers to toil away for years without a concrete chance for partnership. Now the business works in a more flexible way that rewards young lawyers earlier in their career with stock options and other benefits found in the business world.
But should a law firm be allowed to work like normal businesses? Steven Crane, chair of the ethics committee of the American Bar Association didn’t think so. Because law firms must adhere to stricter ethical concerns not found in other professions, the introduction of shareholders creates a conflict for potential clients. What happens, for example, if investors demand a firm drop a particularly unpopular client? In any event, Slater and Gordon is currently thriving, but whether their business model will inspire other firms is yet to be seen.
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