What will Biglaw look like in a post COVID-19 world? That’s the question on everyone’s mind as we, hopefully, move closer to a new normal. In a new interview with Law.com, CEO and chairman of Cooley Joe Conroy breaks down how he sees his firm positioned post pandemic.
The big headline is that Conroy said Cooley has no plans to cut associate salaries or do any layoffs. Conroy said that the firm’s travel and meetings budget — obviously going unused — is providing sufficient cost-savings. But don’t think that Conroy expects no changes in the legal industry. Conroy predicts demand for legal services will be down in a big way because of coronavirus, and that collections will also be down because of the economic conditions:
Our board and I certainly think that we are going to face to reduced demand in 2020. I also think that we’re going to be in an environment where we are going to get lower realization. That’s what happens when economies worsen. That having been said, we haven’t seen it as of yet. We’ve been, with respect to all the metrics that we measure our business, on or over plan. And that has even held up through 11 days this month on cash collections. Trying to figure out what the baseline to plan for is a little TBD. I hope I’m wrong. I don’t think I am. But my guess is that when the book is written on 2020, I will look back and say, “OK, we experienced 10% less demand than we thought we would, 15%, whatever it’s going to be.”
Though these predictions might seem like a downer (though very realistic), Conroy says he is an optimist. His take on the outlook of Cooley certainly reflects that, and he also noted that Cooley is positioned to come out of this in a better position than most:
[A]lthough this is a terrible set of circumstances for all of us and we’ve got to buckle down and do some things differently during this period, we think there will be some law firms that emerge from this circumstance better than others, and we think we’re going to be one of them.
Part of the reason why Conroy believes this is due to the firm’s partnership structure. The firm eschews income partners and Conroy says that means business development is an essential part of the firm’s makeup:
One of the things we’ve always said about our partnership that gives us a higher likelihood of performing well in a down market is we don’t have service partners, we don’t have nonequity partners, and we’ve got business development in the genes of our partners across practices.
Let’s hope plenty of firms are positioned to get through the COVID-19 storm.
Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).