The idea is to disrupt. A big four accountancy firm bridging the divide with law. A cross-border melting pot of professional services under one roof, one global brand. Perhaps it is so obvious it doesn’t bear saying.
Alan Murphy, Head of Law at EY Law Ireland for one, doesn’t feel the need to spell it out. But he believes in offering a service that chimes with how business is done today he is part of the future. In conversation with him, the word synergy crops up more than once.
He also tells me a university has identified EY Law’s arrival in Ireland as a disruptive force and will be monitoring its progress in the market. No clues are given as to which university department will be stalking the new firm because he got the information informally on the down low. But he looks distinctly pleased with this fillip, like it is a harbinger of success.
Underneath him through the glass windows of EY’s Harcourt Street offices, south Dublin city unfolds stuttering back to life at 9am on a Friday morning with the easing of Covid restrictions.
Murphy has been in situ at EY since the beginning of March. He says EY Law has been active in the Irish market since then. “But maybe not visible,” he concedes. Much of the early graft went into hiring “really really senior people, technically excellent people” that would align with the culture of EY.
People not unlike Murphy himself, who is unquestionably a seasoned operator. Prior to his current appointment, the real estate lawyer was managing partner of Eversheds Sutherland Ireland for 12 years and was chair of its European operations as well as being on the firm’s global board.
On turning 50 recently, he wanted a new challenge. EY approached him last year and presented him with a dynamic opportunity – to head up its new Irish law firm, a standalone practice billed as a unique integrated legal offering with access to expertise across the EY network which is made up of over 150 countries worldwide. Murphy grabbed the opportunity, inspired by EY’s commitment to growth and branching out beyond its accountancy roots into technology consulting and data analytics.
As a service, EY Law is already available in 92 countries. Ireland is a relative latecomer.
Joined up thinking
When we meet, we discuss everything from EY, tax reform and the future of professional services to chinese walls and the state of the property market. Murphy tends towards the circuitous in conversation or at least he can be hard to pin down on basics, like the growth plans of the firm in the next two to three years. “We want to go to the skies with EY Law,” he tells me as our conversation kicks off.
Undoubtedly. But back on the ground he begins by telling me about the all important early hires.
Alan Murphy (AM): We see a huge opportunity. So we have six senior leaders hired, and we have four of them who have already started. Adam Synott in corporate m&a, myself obviously, Deirdre Malone in employment. Deirdre will be based out of Cork. We will be creating hubs around Ireland; one from Cork, one from Galway, maybe one more Waterford. And then we have Mairead Finlay in international real estate investment, and then we have Peter Bolger, and Robert Haniver joining and digitech commercial in the early New Year. We see digitech commercial as a massive area and one that’s very much aligned with what EY does in the market.
Francesca Comyn: What is the spectrum of digitech commercial?
AM: Digitech commercial ranges from commercial contracts to cybersecurity to data protection to IP to data privacy, so it covers that full gamut. And you know, obviously, with tech consulting and with tax, IP, IP migrations in and out of Ireland, tax and IP, there’s a huge synergy there. If you look at tech consulting, cyber, if someone has a cyber attack on their business which unfortunately is very common place these days, EY is normally there on the ground, rapid response in terms of handling first of all the crisis management around that, then how do you look at the systems, how do you react to the systems, what measures do you put in place dealing with stakeholders. And usually, and I’ve had this experience even since I joined, that happens and the call is made, where do we find the lawyers, where do we get the legal advice because there’s lots of legal advice needs to run that piece both in the systems, and also in relation to the stakeholders, and our intention is to have law in the room from the outset with consulting, so that that just flows seamlessly and adds value to the client.
FC: And is this partly because the DPC is here. Is this a particular focus in Dublin or essentially is the whole EY Law framework just a blueprint from elsewhere that’s now being adopted in Dublin and being rolled out.
AM: I think it’s a bit of both. There most definitely is a synergy with EY Law globally and what EY does globally but yes there is an interest in creating a hub of excellence from Dublin in that particular area and that’s why we’ve gone for such a senior team and two very, market leading colleagues in that area. And Europe’s actually very excited about it because of the number of tech companies that are Emea headquartered out of Dublin.
FC: We’ve seen with the LSRA, there has been shifts in what is allowed. So what was the change that permits this kind of full professional services joint up team?
AM: Multidisciplinary professional firms still aren’t actually allowed here. Again, part of our strategy was to do this property and establish a standalone law firm to accord with the regulations of the Law Society of Ireland and that’s what makes us absolutely unique amongst the big two we’ve got a standard on the offering view Ireland that sits as an integrated part of the wider big four EY offering. And so, we as yet don’t have a multi disciplinary, but you know we have worked very hard to provide what a multidisciplinary can provide.
FC: But as far as the customer is concerned, or the client, it is as if it’s all the same house.
AM: I think the important thing is that we will all be on the one team, and we’ll all be working together and we’ll all know each other as colleagues, so we will present to the client as one team and we’ll be able to deliver as one team. So our client won’t have to go to two or three different firms to seek advice for a particular project. You know I was down in Cork and I was actually meeting our head of r&d incentives Ian Collins. He sits in tax, and he was talking about his area, capital allowances. Mairead Finlay was there. She’s the real estate lead. Capital allowance is becoming increasingly important in real estate. There is a synergy there. He was talking about the new gaming tax. Peter and Rob who are joining after Christmas are experts in gaming law. So, just everywhere it’s like popcorn popping, everywhere you go mutual opportunity just seems to be appearing, and it’s all for the benefit of the client because it’s nothing if it doesn’t bring value or benefit to our clients.
FC: Is there a risk of groupthink? I mean, where are the Chinese walls? I mean, is it always good to have everybody on the same page. We’ve seen some corporate disasters in the past where that’s been a problem.
AM: No I don’t think there is a risk of group think at all. I mean for a couple of reasons. First of all, we are a standalone law firm regulated by the Law Society. We will accord with those regulations. Secondly, EY has a very rigorous and robust regulatory environment. It is already used to, between consulting, between tax, between assurance, making sure that those rigorous interests are preserved. And then the other thing is, and this is where the magic is going to happen for the client, lawyers think differently to accountants, think differently to tax advisors think differently to consultants, there is that diversity. In fact I would argue Francesca, it’s the opposite. We’re bringing together diversity of thought, we’re actually doing what everybody wants to do at board level in this country which is bring inclusion into the room and let everybody have a voice.
FC: That would be there anyway though because, on big deals, you’re going to have the lawyers in the room, whether they’re from another firm or not is I suppose potentially an inconvenience in terms of the bill and the package. Do you bill separately if you are separate at EY or is it all offered as one service?
AM: Insofar as possible we will offer a seamless service. Would it be there already? I think, by bringing everybody into the one room together in one team you also develop an understanding of each other, and you develop a way of working together, and being able to understand each other’s thought processes and work practices. So I actually don’t know if it’s there already. And I think we would be able to bring it to the next level. Again, for the value of our clients.
FC: You worked in Eversheds for years, and Dublin, for example, is a fairly small place; the business communities are fairly small; the law firms, they’re the same ones, time and time again. You can’t honestly say that there’s a mystery if someone from McCann Fitzgerald or Arthur Cox, or Eversheds walks into the room. There’s not.
AM: There are so many excellent lawyers in this city who do their jobs very very well, what we hope to bring is something different.
FC: And is the difference then, that seamlessness you’re talking about, the fact that you’re in the room from the get go, or is there something more to it?
AM: The difference is, if I were, say for example, selling my family business, I would need corporate finance advice, I would need tax advise around how I structure it, I might need valuation advice. The difference with our model is that now law can be there from the start. I’ve heard frequently, I’ve got feedback, you know in formulating a step plan for say the sale of a business, the lawyers are brought in at too late a stage. You know the step plan is built around tax, it’s built around corporate finance, and then someone says ‘did we ask the lawyers what we should do’. So one of the things we would like to achieve for our clients is to bring the lawyers in the room from the beginning, and get them involved say, for example, in the step plan, get them involved in the mechanics of that. The lawyers then might step out of the room, and let the due diligence process or the sales process proceed, the tax structure, but at least the lawyers are there with their advice from the outset, and the client knows that they’ve been fully advised and are going in the right direction.
FC: When would EY Law step back and say ‘okay this is something we don’t do’. You mentioned the areas of practice. It’s all on the advisory side obviously. When it comes to disputes or litigation, that’s not that’s not on the cards right.
AM: We’re a standalone law firm regulated by the Law Society so we will accord with all the rules and regulations that any law society regulated firm will do.
FC: I suppose what I’m saying is that the service you’re offering, is it all going to be on the advisory side or would there be, would you end up having a litigation team, what’s the plan?
AM: Well currently our four areas are digitech commercial, commercial real estate, employment, and corporate m&a. I think as we move out, as we develop and grow, I would like to develop along sector lines. So for example, EY is very active in energy sustainability ESG. So you know we would be very interested in developing that out from law. EY is really good in financial services regulation, we are very keen to look at that particular area. So I think what we’ll do will align with what EY otherwise does to be able to provide a combined offering.
FC: You have these specialist offerings but they all seem to be clearly on the advisory side, so it’s not a fully rounded practice but I’m wondering, is it going there? Would you see yourself down the high court in five years time or whatever?
AM: We’ll see how we develop, but at the moment it’s not contentious.
FC: There’s nothing new or unique about this offering. it’s just new in Ireland but you’ve probably seen it deployed elsewhere. It’s pretty common right so people know how it works?
AM: I mean EY Law is the fifth biggest law firm in the world by people numbers. It’s across 92 jurisdictions. Law is one of the fields of play. The strategic objectives of EY globally. But EY Law is not known as of yet, until now, in the Irish market, but it is something that has been proven and tested. And it has been very successful in many jurisdictions across the globe, and I see it as part of the future of law. It’s one of the reasons why I joined, because I see that multi disciplinary combined with multi jurisdiction offering as being part of the future of law, because it very much goes hand in hand with where our clients are going.
A new disruptive offering
FC: So basically there are going to be these behemoth, multi disciplinary professional services firms. I’m guessing you’re thinking that’s the future and if it’s the future internationally, it’ll be the future in Ireland as well.
AM: I mean there’s a need for various different types of models but you know for many clients who are increasingly globalising, increasingly working across jurisdictions; transactions are becoming increasingly complex, regulations are becoming increasingly complex. Yes, they need top premium multi-disciplinary advice.
FC: I spoke to one managing partner recently who noted EY was on quite an aggressive hiring spree. How do you think this is going to affect the domestic law firms or the non-domestic law firms that have arrived?
AM: Look, there are many very good firms in Ireland, it’s a very sophisticated legal market. I believe that we will bring, or are bringing something very different to the market and something that’s of value to clients. So it will all play out in the market and it’ll all be about what value and benefit we can bring to clients.
FC: Do you think it will be disruptive?
AM: I understand that one of the universities has already identified us as a disrupter, and is monitoring our progress as a case study, which I was pleased to hear.
FC: Do you see others following suit? Is it only a matter of time?
AM: We are first mover in terms of creating a law firm within a big four environment. I can’t speak for the other big four. I think that the EY environment and the EY culture and strategy is very well aligned to doing this. It’s one of the reasons why I wanted to join EY to do this because, as you may know, EY has got a very ambitious strategy. It wants to double in size by 2025. It just announced 816 jobs. And part of that growth is going to be into new areas such as sustainability such as data analytics.
I think law as a new and innovative offering for a big four fits very well into that dynamic, energetic model and the other thing is that now, EY has doctors and engineers and nurses and robotic engineers as part of its family. Again, law fits very nicely into that because five years ago I would have looked at EY and said ‘okay, tax and assurance slash audit, not sure what else it does’ that’s all utterly transforming.
FC: We would see, say, Maples in this market, so it’s not entirely unique but I suppose you’d argue that because it is of the Big Four, that the impact may be more substantial.
AM: Well I mean I’m not going to get caught up in our uniqueness. It comes back to what value we can bring to clients. We are nothing if we don’t bring value to clients, I believe our model yes will bring value to clients.
FC: When you say value, most people understand value in terms of those figures at the bottom of the page. Right, that’s what you mean? I mean it’s not necessarily about being cheaper obviously but it’s about an overall package.
AM: When I say value I mean, delivering for our clients, enabling our clients to achieve their objectives, do what they want to do, that’s ultimately why a client wants.
FC: Yeah, but a lot of people can do that. I presume there’s got to be something on the bottom line if it’s all under one roof?
AM: On price, I think this model will achieve cost efficiencies because we’ll be dealing with one team. And therefore, you know, we will be able to iron out the wrinkles in that a client won’t be dealing with three or four different organisations or three or four different firms.
FC: You mentioned, I think, six partners. Overall what are the numbers you’re looking for in the practice in the next two, three years?
AM: We have four senior associates joining us over the next month, and then we’re moving to more junior solicitors. We’re very interested in an intern and grad programme. I mean, I always find it impossible to say no to a student who contacts me and wants to talk to me about the future etc etc. So I’ve seen quite a few students over the last two weeks. And what I found, in talking to them is that a lot of them are doing multidisciplinary degrees like business and law and they can’t quite decide where they want to go. So the idea of doing an internship or indeed a training programme in a multidisciplinary environment, particularly at intern level, where you can get some tax experience, you can get some consulting experience, some law experience they’re really energised by that.
FC: So numbers wise, what are we talking about? You must have a headcount in mind, a plan for the next two to three years. That would be fairly basic.
AM: We honestly will go where the client wants us to go we will grow as the client…
FC: But right now how many have you got?
AM: At the moment we have our six leaders, we’ve added four senior associates we’ll probably add two-three more after Christmas and then we’ll look for our junior solicitors. We haven’t gone to market for junior solicitors yet because I would very strongly believe that you need to bring in the people who will mentor the younger colleagues so I don’t think you go for the younger colleagues first.
FC: Totally, but I suppose would you see yourself having 50 to 80 staff in five to 10 years, or would that sound like too many?
AM: I don’t think it sounds too many at all. I would have thought 50 would be a very comfortable number. Again, it will all be about the quality of the person and the service that we can deliver.
FC: I suppose FDI clients is the main market.
AM: FDI will be part of it, yeah. International companies doing business in and through Ireland, I think obviously there’s a natural synergy there, but the synergy is there in the local market as well the synergy is there with the local plc, the synergy is there with the local family businesses, there’s synergies there with the tech companies. I think there’s huge opportunity. We just need to demonstrate that opportunity to the market.
FC: We’re obviously seeing a shift there. Paschal Donohue has struck the OECD deal on corporation tax. Undoubtedly, there’ll be people saying it’s great because now there will be more certainty. But we’ve seen hand wringing from professional services firms about the risks tax changes pose to the sector in terms of employment. What’s your position on that?
AM: I mean, personally, I’d be very sanguine about that. In terms of my former place I would have chaired a European board where I would have led 16 countries and I visited every one of those countries twice a year. I think Ireland has a huge amount going for it, in terms of its talent, in particular actually its talent. And in terms of its open economy, in terms obviously of its language. I was delayed this morning because we’ve been asked to pitch for a job where a particular country is looking to rewrite its company law, and it’s looking to two countries, the UK and Ireland, the UK because obviously it’s the foundation of common law, Ireland because we’ve taken common law in a certain direction. We’re still in the EU, we’ve a very vibrant aviation financing leasing funds market. We are seen, I think, across Europe, as a country that has moved forward, has advanced, and has a lot going for it. So personally, I would be very sanguine about our future.
FC: Do you think the deal brings certainty?
AM: I think it’s good now to have a game plan to move forward, yes.
FC: You were mentioning there a lot of the benefits of Ireland for business. I suppose the reason I brought [the 12.5 per cent rate] up is that in interviews like this traditionally when you raise the tax question, the answer is that Ireland has loads and loads of other things going for it but then it turns out, the minute there’s a risk to the corporate tax system, there are a lot of panicky letters from professional services firms to government saying it will be an absolute disaster.
AM: Well, as you say, I would be very hopeful for what we have to offer and deliver.
FC: But a lot of it rests on tax, I mean can we at least accept that?
AM: Tax is very important. As I say it’s now good to have a game plan.
FC: I suppose I’m asking because you are branching out in Ireland at a time of uncertainty with the debates around tax in the US and the OECD. Is EY confident that Ireland still has a prosperous future beyond the next five to ten years?
AM: I don’t think there has ever been a better time to bring an offering like this to the market. If there isn’t certainty as you say uncertainty needs advisors. If clients face uncertainty they need people to guide them through that..
FC: If the clients leave the country they’ll need guidance in different countries, not Ireland.
AM: If there’s uncertainty, clients need advice because uncertainty normally leads to activity and activity requires advice. But there’s so many different reasons why; post Brexit, there still is movement from the UK to Ireland in terms of trade. As I say there’s increased globalisation and also a lot of the areas that EY actually specialises in such as tech consulting, tax, again, are very, very active areas at the moment. So I don’t think there’s ever been a better time. As you know the corporate m&a market is actually quite active at the moment, there’s a lot of private equity in the market waiting to be spent.
FC: I know there’s a lot of private equity in the market but I didn’t know the m&a market is particularly active. What are the reasons for that?
AM: Well, I think, you know, obviously with covid, there was a delay in a lot of deals, there was uncertainty around what might happen. I think now, hopefully, things are easing and I think people are starting to do deals, again. I think it’s as simple as that.
FC: What about you, why did you leave Eversheds? You were there 15-20 years?
AM: So I joined Eversheds when it was a local boutique property firm O’Donnell Sweeney. When I qualified I kind of fell into being a commercial real estate lawyer, a dirt lawyer as I like to call it, and at the time O’Donnell Sweeney was one of the leading – still is, but it was one of the leading real estate firms in the country. And I wanted to work for Rory O’Donnell, who was the lead partner there so I joined in 2000. And I did various different things there. During that time, I was very much interested in the future of the law and I saw the opportunity, and we as a partnership saw the opportunity for that multi jurisdictional piece and were way ahead of the opposition in terms of that multi jurisdiction piece which has become failrly well embedded in the law market. I was finishing up my third term as managing partner at the end of last year. It’s 12 years as managing partner, which was twice as long as any other managing partner had served in Eversheds Sutherland, and I was also facing a momentous birthday in the midst of covid so as you can imagine I celebrated that royally. But at least I got out to a restaurant in fairness, which was brilliant. But I knew, I kind of wanted to do something and EY approached me at the beginning of last year actually and started to talk to me about this proposition and it really interested me.
FC: I mean, I presume to make it appealing they offered you a fairly good war chest to go on an acquisition spree, because if there’s one thing I keep hearing about law jobs is that it’s competitive at the moment.
AM: I mean one of the advantages is that EY is fully supportive of the proposition, and is really behind it and backs it all the way. We want to do this properly. We want to get as good people as are out there that we possibly can. It’s hugely important because it’s all about people.
FC: With your background in real estate, the property market is in some mess now. There’s obviously a residential property crisis but then, I’m wondering, with commercial property there is concern about that coming back on track, whether investments would go down with covid. I remember reading court papers relating to a property development dispute and the internal chat was all about the market being cyclical and how around 2018 was the time to get out because it gets riskier at the top of the market, etc. Where do you think the property market is now, what part of the cycle are we in?
AM: I’m not speaking for Primark but they’re voting with their feet. They just opened their 400th shop in Sicily last week so they are pursuing their strategy but there is no doubt that retail has changed utterly but it’s just interesting to hear people saying that actually the high street is gradually coming back, no doubt transformed but coming back. Offices will be interesting to watch where office. Will there be less office space required. I think a lot of that is down to density. Say for example, take EY here we’ve reconfigured our office spaces over the last couple of months to allow for a much more team collaborative spaces. Obviously we’re observing social distancing between chairs etc etc etc. So that will lead to lighter densities. It’ll be interesting to see if there are fewer offices needed. But the densities can’t be quite as great as they used to.
The other piece that I’m hearing, again from conversations over the last couple of weeks, is around sustainability. Increasingly, we’re going to have to build much more sustainable buildings which are very costly, by the way. But that rents will be quite high for those buildings, and rents will be lower for buildings that aren’t as sustainable or are first generation buildings.
FC: You don’t necessarily see there being issues getting anchor tenants in big commercial developments that are being going up at the moment
AM: It’ll be a watch and see to see where things go. I genuinely think it comes down to densities as to what the requirements of particular companies are going to be.
FC: I was in court the other day and Footlocker described Grafton Street as a terrible location or something of the sort [‘very poor’] in terms of footfall. So that – retail – is going to be a slow process.
AM: Yeah, no. I’m just feeding back what I’ve heard in the past couple of days.
With that our interview comes to an end. As I pack up, I ask him if there is anything we could have talked about more. He says sustainability. It is going to be a big piece. And it’s very much on EY’s agenda.