Back in June, The Lawyer asked more than 200 UK law firms what they thought would be the biggest risk to their financial position in the next 12 months.
Many firms (around 40 per cent) said Brexit.
But just one, Macfarlanes, said that a Trump presidency would have a major impact on the stability of the market and law firm finances.
Following the shock election of Donald Trump, The Lawyer has caught up with Macfarlanes senior partner Charles Martin about his predictions for the impact of the US election results on the UK and international legal markets.
“This could well be a bigger road bump than Brexit,” said Martin.
“It could have a chilling effect on world trade and I wouldn’t want to predict what ramifications that could have for our clients.”
“But, we need a bit of calm to allow people to get their heads round it. Trump is not inherently anti-business and we need to see what of his rhetoric comes into fruition.”
“It’s the implications for trade deals that pose one of the biggest risks. And also some of the more insensitive and disturbing comments that he has made about key diplomatic relationships around the world.”
Brexit is already having a significant impact on M&A deals and IPO listings, with the value of UK M&A deals dropping by 45 per cent in the first nine months of this year.
There has also been a 66 per cent reduction in the number of main market IPOs on the London Stock Exchange.
“Both this and Brexit owe their roots to a sense of inequality and a sense that people are not being listened to – as well a as partly to the financial crisis and partly to globalisation,” Martin added.
“I also think that there are unforeseen consequences of information technology. Many had expected it to reduce inequality, by bringing communications to more undeveloped places in the world. But it has also actually increased inequality in mature economies by concentrating wealth into the hands of people who hold the intellectual property and those who are able to be part of the digital world.”
Macfarlanes was one of the 11 firms in this year’s UK200 to record an average profit per equity partner (PEP) of more than £1m. The firm’s PEP totalled £1.29m in 2015/16, having fallen from a high of £1.55m over 2014/15.
Martin added: “In the short-term, we expect volatility and that will cause people to put things on hold.”
“But things will come back in the longer-term. It’s too hard to call just now.”
To purchase the full UK 200: Top 100 report please contact Richard Edwards on 0207 970 4672 or at richard.edwards@centaurmedia.com
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