Law firm Allen & Overy launches regulatory consulting business

10 July 2018 3 min. read

One of the UK’s five largest law firms has launched a new regulatory consulting business. Allen & Overy will hope to tap into a booming market, as demand for regulatory consulting surges amid a raft of changes including GDPR and Mifid II.

Much has been made in recent years of the potential for the consulting industry to permeate the legal arena. The Big Four consulting and accounting firms could draw an annual revenue of $30 billion from legal services, were they to fully expand into the market, according to a recent survey. Consequently, 69% of law firms see Deloitte, PwC, KPMG and EY as major threats to their market share, following successful forays into a host of other segments by the gang of four.

However, it would be a mistake to think of this as one way traffic. As the branching out of advertising giant WPP into consulting has shown, long-term incumbents of one industry often weigh up expanding into the booming professional services market to buoy their own revenue streams. Feeding into that trend, ‘magic circle’ law firm Allen & Overy has stunned the consulting world with the announcement that it will launch its own regulatory consultancy this year.

According to Allen & Overy, its new strategy group will focus on regulatory business advice to corporates. The new group will be a separate business, and will not offer legal services or be regulated by the Solicitors Regulation Authority.

Law firm Allen & Overy launches regulatory consulting business

Allen & Overy is one of the five largest legal firms in the UK, and among the world’s top ten, with revenues in excess of $2 billion. The firm’s reputation for legal prowess arguably makes it perfectly suited for regulatory consulting then, which is primarily driven by helping clients navigate shifting legal boundaries. On the back of a wave of new regulations which corporates are facing, including the infamous GDPR, the sector is booming at present. Similarly, a large portion of Allen & Overy’s recent work in financial regulation includes advising financial institutions on the implementation around Mifid II regulations.

Allen & Overy has hired Sally Dewar from JPMorgan to lead the new regulatory consulting business. Dewar is currently head of international regulatory affairs at JPMorgan in London, and is set to continue in her non-executive role as Chair of the Audit Committee for JPMorgan International Bank, subject to regulatory approval. Before her role there, she worked as a Managing Director in Risk at the Financial Services Authority – the UK’s former financial watchdog.

Richard Cranfield, Partner and co-head of the Financial Institutions group at Allen & Overy, said, “The pace and scope of financial regulation continues to grow as regulators become ever more invasive. Our clients have asked for a broader advisory capability to complement our legal practice.”