Partners at leading UK law firms received record earnings last year, driven largely by strong growth in Asian markets that offset slower domestic demand. For the year ending in April, equity partners at Linklaters and Clifford Chance earned average compensation packages of $2.5 million and $2.3 million respectively, surpassing previous records. Allen & Overy and Shearman & Sterling reported average partner profits of £2.2 million, while mid-tier firms Ashurst and Simmons & Simmons posted their highest profit per equity partner (PEP) figures to date, at £1.6 million and £1.25 million.
The surge in earnings was underpinned by increased activity in initial public offerings (IPOs) in Hong Kong and mainland China. Legal work linked to these listings, as well as related transactions on the continent, contributed significantly to revenue growth. Linklaters experienced a 36% rise in profits from its Asian operations, while Clifford Chance recorded a 26% increase in regional revenue. Both firms advised on four of the ten largest listings in Hong Kong during the period. Ashurst posted a 22% increase in revenue from its Hong Kong practice.
Paul Lewis, global managing partner at Linklaters, highlighted the importance of IPO work, noting its role as a gateway to related areas such as mergers and acquisitions. Firms had anticipated this rebound in Asian deal flow, beginning significant recruitment efforts in the region around two years ago to position themselves for growth. According to Sonia Taylor, director at Hong Kong-based legal headhunter Sonder Consultants, the uptick in partner hiring in capital markets often precedes a broader market recovery and signals sustained expectations for deal activity.
UK-based firms have also capitalised on a retreat by many American law firms from Asian markets. Since 2020, approximately 20 US firms have either exited, shut offices, or restructured alliances in China and Hong Kong. This has resulted in a greater volume of inbound work to UK firms through referrals, according to Emily Monastiriotis, global managing partner of Simmons & Simmons.
In contrast, the UK market remained comparatively subdued, with firms reporting only modest revenue and profit growth in the single-digit or low double-digit range. Legal recruiters point out that these growth rates, when considered alongside annual increases in hourly rates, suggest a slowdown in market expansion. Meanwhile, the U.S. market has continued to be a source of new business for UK firms, partly driven by ongoing investment via hiring and mergers.
Overall, the performance of UK law firms last year reflected a divergence between buoyant activity in Asia—particularly Hong Kong—and less dynamic conditions in their home market, underscoring the increasingly global nature of legal services in capital markets and corporate transactions.