Accounting firms branching into the legal space is nothing new, but after several years of relatively slow expansion in the area, Ernst & Young have announced major growth plans for their legal arm – and New Zealand is no exception.
EY Law is a global network involving lawyers either working in partnership with EY’s accounting arm (where allowed), or involving member firms that are independent from EY but share the company’s brand. The latter is the case for EY Law in New Zealand.
Kirsty Keating, EY Law partner and head of the New Zealand EY Legal team, tells NZ Lawyer
that the ‘Big Four’ accounting firm’s global legal network includes more than 1,000 lawyers (including 13 in New Zealand) working across 50 jurisdiction – and that the total number is set to double in the next 12 months.
While the menu of service offerings differ between EY Legal branches globally and can include everything from IT/IP to employment & labour law, tax law and mid-tier M&A, the New Zealand branch is currently limited to its existing tax legal team. However, this is set to change.
“New Zealand is in the process of commencing with employment & labour Law and corporate/commercial practices to add to the existing well-developed tax legal team, which specialises in tax controversy services,” says Keating.
She says her experience in New Zealand has demonstrated that clients are receptive to multidisciplinary professional service providers and that EY Law’s relatively new status means the group can grow “organically,” depending on clients’ needs.
“In New Zealand, we are taking an organic approach to the development and expansion of EY Law and will keep our options open to invest where we see opportunity,” she says. “Our clients have received this well and we have the benefit of being flexible and going where the market provides opportunities both locally and via the global network.”
Keating says recruitment has been a key focus in getting EY Law off the ground in New Zealand and that she’s not interested in “sacrificing quality in favour of quantity”. So far, she says, most of the legal team have been hired laterally from top tier firms around the country.
“We do not have any fixed views as to a head count as yet, decisions of this nature will be made as we grow and develop our New Zealand business,” she says.
When it comes to clients, Keating says the response has been highly positive.
“In an increasingly global world, it is convenient for clients to come to EY Law, where we can service their needs in most areas around the world that they want to go and it is comforting for them to know that one hand will know what the other is doing,” she says. “Because we are fairly new, we are not set in our ways and are well placed to adapt to a fast-changing commercial environment.”
Despite presenting a potential alternative, Keating insists that EY maintains positive working relationships with some law firms – and that the intention of EY Law is never to become a full service law firm.
“We maintain good relationships with some law firms and New Zealand Counsel and will continue to do so. We are not planning to try to be all things to everyone,” says Keating. “There will always be instances where referrals will be appropriate. But, in terms of services we aim to provide, we believe that more choices for clients will always be received positively.”
However, EY are not alone in their expansion into the legal services market. PwC also says it wants to double the revenue from its legal practices globally from US$500m to US$1bn. Similarly, Aldrin de Zilva, who heads up Deloitte Lawyers in Australia, told NZ Lawyer sister publication Australasian Lawyer that the firm’s legal practice
has been growing steadily over the last five years – from five to 35 lawyers in Australia– and that its aspiration was to double in 'the coming years’.
Keating says EY Law’s global network intends to expand into Hong Kong, Indonesia, Taiwan, Korea and Japan.
The other 'Big Four' accounting firms: Legal capability growing
- Focuses primarily on taxation issues, but also skilled migration
- Has one of the largest tax litigation teams in terms of size and number of cases and has represented clients in over a dozen separate disputes with the ATO in Australia
- PwC is currently offering legal services in Sydney, Melbourne, Perth and Brisbane
- Has 30 Australian partners who are entitled to practice as lawyers and about 130 staff with practising certificates
- Has five partners and executive directors in Australia and 13 professional staff
- Is a specialist tax practice offering services across three broad service lines: tax legal advice, tax dispute management, and tax-related legal services