When in late 2021 Baker McKenzie South Africa’s long-time managing partner Morne van der Merwe departed the firm in the wake of bullying accusations, it plunged the office into scandal and left the firm in dire need of a new image and a refreshed strategy.
So, in May, the firm installed a new Johannesburg management team headed by managing partner Lerisha (Lee) Naidu.
“The handover has been done, and Lee is now making the decisions,” said Michael Foundethakis, Paris partner and chair of the firm’s Africa steering committee. “We are confident that we now have the right hand on the tiller.”
But, with van der Merwe being such a dominant presence in the office and the wider firm, many questions remain over the office’s future, and whether, even with a new broom at the top, the firm can extricate itself from the recent bullying scandal. Indeed, there is still anger over how long the firm took to respond to the bullying complaints, with commentators going as far as saying that prospective joiners might still be wary of the firm.
However, the new leaders are ardent in their belief that positive change is already happening, and that they are the ones to lead the base into a prosperous, expansive new era.
In August 2021, van der Merwe stepped down as office managing partner due to reports of “bullying-related issues” that had “been going on for months”, people with knowledge of the firm said at the time. A few months later, Foundethakis was tasked with refreshing the firm’s global Africa strategy and changing an approach and a leadership that he described as being “of a certain vintage”, more traditional in how it was organised, and locally focused.
Now, new leader Naidu wants a fundamental shift in the office’s approach and ethos.
One of the lessons learned during the turbulence of the past year is the need to detach from a revenue focus to give more attention to values, said Naidu.
“This includes how we treat people, how we take on work, and what we do in relation to pro bono work,” she said, stressing that “Baker McKenzie prioritises values over profits”.
The transition to the new management team involved Baker McKenzie’s Amsterdam office providing support and ensuring that the Johannesburg practice was brought “back in line” with the firm.
This included “reminding the Johannesburg office of its place within the firm, the best practices and values being deployed globally and how we inculcate that into this space”, said Naidu.
“We are a South African office and have been encouraged to be so by the firm, but within the broader context of the Baker McKenzie global one-team approach. We are keen on building out, collaborating more with other offices, and working on global mandates, which attract higher revenues.”
In a shift from the old ways of doing things, Foundethakis said “the new management team is saying, why don’t we look at things differently, and why aren’t we doing more work on the continent?”
If Africa deals are staffed out of South Africa it will be less expensive for the client than doing it out of London or Paris, it will likely be more profitable, and the firm will be more likely to win pitches, he said.
“It’s the right time to change the model, and I have the buy-in from Lee and her team to do it. They want to be doing this Pan-African expansion. In the past, we sometimes took our eye off the ball in terms of how much more our Johannesburg office could be doing.”
For example, he said, he did a deal in November in Nigeria that was staffed 95% by practitioners from Johannesburg. “The client, a DFI, wanted to see African-based lawyers on the deal.”
But, despite the necessity of an overhaul and broader firm support, concerns still remain.
When asked what impact the departure of the previous management team had in terms of loss of clients, Naidu said: “Yes, one or two clients walked out the door, but by and large it was business as usual. And I’m happy to report that we had good profitability for the year, notwithstanding the departures. We have a robust group of partners that all have client practices that stand on their own two feet.”
Despite the apparent bullishness, there is still scepticism in the market.
This includes the inevitable repercussions of the firm’s global management having “dropped the ball” in taking so long to respond to the bullying complaints at the practice that the issue developed into a full-blown scandal, one person with knowledge of the firm said.
The “good people” who left during that time will be difficult to replace given the recent history and bad press, a recruiter who focuses on the Africa market commented to Law.com International.
Wildu du Plessis, partner and former committee chair, and Foundethakis’s predecessor, left Baker McKenzie shortly after Van der Merwe, as did Bruce Schubach, the former director of operations. The three subsequently founded Alchemy Law Africa and were joined in October by Fani Dingiswayo a former partner at Baker McKenzie. According to people close to the situation, other fee earners left in the aftermath of the scandal.
“Partner-level potential hires are likely to be wary, despite the Baker McKenzie global brand,” the recruiter continued.
The person added that the autonomy of the new Johannesburg management team is also in question, as the hiring of new people tends to be handled out of Europe.
“This is too far away from Africa for the new Johannesburg management to have any control over the build of new people,” they said.
A partner at a rival firm said that the delays in handling the complaints “said something” about how the office was run and that it would “take time” for people to see the Johannesburg office in a “different light”.
A ‘Change Journey’
However, in response to these doubts, Naidu said that the office leadership draws views and perspectives from Baker McKenzie’s network, “both locally and abroad” for laterals.
“People are at the heart of the office’s success and our office is therefore intimately involved in selecting exactly the right people that will contribute to its sustainable, long-term success.”
She added that the firm’s South Africa’s “change management journey” has “yielded notably positive results in a fairly short period of time, including the re-hiring of talent that had once left the firm”.
She added: “The change journey has been driven by local leadership in collaboration with experienced partners from the global firm, from whom we have drawn best practices that informed the office reset, reflecting Baker McKenzie’s one firm approach.”
The firm’s current headcount in Johannesburg is nine partners and an associate body of about 25, said Naidu.
“We are looking carefully, particularly at our transactional practices, around beefing them up with lateral hires of partner teams, and that’s a major project that’s currently underway,” she added.
A Commitment to Africa
With its new management installed, the firm’s wider leadership is refocusing its energies on continent-based work, and Foundethakis is adamant that “we have never, ever, ever considered pulling back”. He added: ”We are committed to Africa!”
“Our global footprint has always been larger than any other law firm and it’s been established predominantly in markets that other firms were not willing to go into. And the African continent is too big for us to ignore.”
The firm’s Africa-focused team currently includes more than 100 lawyers based in the three Africa-based offices and over 200 Africa specialists globally across 76 offices. In addition, the firm has a network of 100 relationship firms in 51 African jurisdictions, according to figures confirmed after the interview.
“In Cairo we have one of the oldest established offices of any international law firms on the continent,” said Foundethakis.
On whether the firm has any plans to expand its presence on the continent, he said, “In the short term, no. In the medium to long-term, yes—where it makes economic sense to do so.”
Another two jurisdictions of interest that were not that strong previously are Côte d’Ivoire and Senegal.
“I’ve got three pitches out for Senegal, and about to do a fourth one for Senegalese projects,” he said.
Other active markets include the DRC with mining projects, due to commodity prices increasing, where the firm is currently “involved in a deal there with African Export-Import Bank”.