EY Law Finds Success by Not Competing With Traditional Law Firms

Sarah Ralph attributes the rapid expansion of EY Law in Australia over the past few years to the firm’s focus on keeping its legal ambitions in check and ensuring its lawyers strive to be part of the broader business.

“We do not consider ourselves to be a traditional law firm. We don’t really see ourselves competing,” said Ralph, who took over as Oceania law leader at EY Law in July of last year.

EY Law currently has 37 partners in Australia, up from 28 a year ago. More than half are women.

The firm provides legal services in areas including corporate law, corporate governance, ESG, employment law, technology and data and real estate projects, and also has a corporate council compliance and governance offering. Unsurprisingly it also has a tax law and financial services practice.

In addition, EY has a legal managed services division, headed by former Corrs Chambers Westgarth chief operating officer Jon Kenton.

“We work across EY to deliver the best solutions to clients. Clients won’t ordinarily and often don’t just have a law question or a law issue. It’s a much broader issue or question that clients will come to us with,” she said.

For instance, wage compliance has become a major issue in Australia after several large high-profile employers were hit by employee class actions for underpayment. EY provides clients with a legal answer and also works with the firm’s corporate tax group and data analysts “to provide us the answer to what the client is really looking for,” which is, has the client been compliant over the past few years and can EY look at its payroll records?

“Traditional law firms really struggle to do that because they don’t have that depth of skill and capability outside a legal sphere,” Ralph says.

Ralph declined to comment on the other Big Four firms, but she said EY’s offering is genuinely different.

“Some of the consulting businesses went in hard to establish law practices and talk about being in competition with traditional law firms,” she said. “They want to be like traditional law firms.”

That’s not what EY Law wants, she says. Instead, the Big Four firm’s focus is on being part of a multi-disciplinary business with the broader firm. And the firm’s lawyers have taken the time and effort to become part of the broader EY business.

“We look for opportunities for other parts of the business. The other parts of the business look for opportunities for law in terms of issues that clients might have,” Ralph said.

“I’m not saying anything negative about the cultures of other law firms or consulting businesses,” she continued. “But I can say the culture at EY is really strong. It really surprised me when I started how that people were knocking at my door to get me involved in client matters, to introduce me to clients where they thought I could add value.”

The firm’s lawyers enjoy working with other parts of the business and being exposed to a different commercial perspective on a matter, Ralph said.

While some law firm leaders insist that clients want the specialization they offer, Ralph believes clients have changed what they look for in legal services and are seeking solutions to their problems that go beyond the legal answer. And they are less concerned about sticking with a law firm because of a long-held relationship.

She points to the fact that several firms in Australia—including MinterEllison, Corrs Chambers Westgarth and Thomson Geer—have started up their own consultancy offerings as an endorsement of the combined legal and consultancy model and evidence that clients are demanding it.

While EY Law has grown rapidly, it is not pursuing growth for growth’s sake. “We will grow where it makes sense to grow when we look at what else is happening in the EY business and what our priorities are. That’s why I think we’ve had such large growth in the last few years,” Ralph said.

She plans to keep the legal practice growing, but incrementally and organically, she said.

There is a particular focus on corporate law and transactions, with Steve Johns joining the Sydney office from Bird & Bird earlier this month, and Cameron Taylor joining the firm’s Auckland office late last year. However, Ralph doesn’t expect the transactions team to compete with law firms to act on high-profile, multibillion-dollar deals.

Instead, she sees opportunities for the corporate practice to partner with EY’s consultancy and tax practice.

“It really comes down to our strategy, which is where it makes sense to grow our practice when we look across EY and we can see the synergies,” she said.

The firm also plans to grow its environmental, social, and governance, or ESG, practice. It is already doing a significant amount of work in the governance and social sphere—helping clients that are dealing with issues such as bullying, and reporting to the board—but Ralph says there is scope for more environmental work.

Ralph stepped into the Oceania Law Leader role at EY last year after joining the firm the year before. She previously worked for 13 years at Norton Rose Fulbright as an employment lawyer. When she was approached by EY to join the firm, she said she was “excited” by the chance to work in a very different sort of legal practice.