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A group of firms is determined to use remuneration as a means to secure the services of star lawyers to disrupt rivals who have dominated the industry, in some cases, for centuries. Across the world, firms are trying to figure out how to survive – go global, stay local, be boutique. It is an intensifying battle to see which will be left standing in a mature, low-growth market. The origins of lockstep compensation, which several elite law firms have adopted at one time or another over the past two centuries, stem from the Cravath system created by Paul Cravath, who in 1883 represented George Westinghouse against Thomas Edison over the patent for the lightbulb. Every summer a large group of top law students is hired to support Cravath's senior partners. Fewer than 10 per cent will make the partnership, perhaps after eight or nine years. Working up to 100 hours a week, the junior lawyers rotate across groups and projects to maximise knowledge and versatility. Clients "belong" not to any particular lawyer but to the firm as a whole. For those who stay the course to become Cravath partners, it is a lifetime career that comes with a guaranteed annual salary of several million dollars. Underscoring the "lifetime" part are traditions such as the Cravath Walk: every partner is entitled to a procession of past and present partners at their funeral, after which the assembled lawyers chant: "The partner is dead, the firm lives." In its 200-year history, Cravath has almost never made "lateral" hires from rival firms. And while some partners would leave for government, to become bankers or a general counsel in Fortune 500 companies, it was until recently practically inconceivable for anyone to voluntarily depart for another law firm. The defections threaten the cradle-to-grave culture at venerable firms, such as Cravath and its peers in the US as well as firms such as Slaughter and May in Britain. "The Cravath system is designed to develop our talent organically, ensuring consistently high quality throughout the firm while fostering a collaborative and client-centred culture that enables us to deliver the best advice to our clients," Cravath said in a statement.
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