**2. The Origins of the Current Business Model: A Commercially Oriented Professionalism**

The emergence of large law firms is perhaps the most significant development of the legal world in the last century, as it caused a radical shift in the nature of the work of (elite) lawyers from courtroom advocates to business advisers.<sup>25</sup> Most law practice before the emergence of large law firms was conducted either by solo practitioners or by larger law offices where lawyers shared space and overhead costs, but often conducted their own separate practices. The developments in society occurring at the beginning of the 20th century in terms of technological innovations, rising complexity in the law, and early emergence of a globalized society, however, made it almost impossible for individual lawyers to perform their job in a competitive and effective way.<sup>26</sup> To cope with such developments, lawyers began to associate in larger firms, where the experience of older partners was mixed with the work force of junior lawyers. While the former were the actual owners of the firms, the latter were (well-paid) employees moved by a powerful incentive, the race to win "the promotion-to-partner tournament."<sup>27</sup> This model has become widely known as the "Cravath system", from the name of the lawyer, Paul D. Cravath, who was the first to organize his firm (Cravath, Swaine & Moore) along these lines.<sup>28</sup> The model was straightforward. The firm committed to hire only outstanding new graduates from top law schools on the promise that they might progress to partnership after an extended probationary period. In exchange, the firm would pay junior lawyers salaries, provide them with extensive training, and increase their responsibility over time.<sup>29</sup> Internally, the firm was arranged in a strict hierarchical system with command and supervision in the hands of the partners.<sup>30</sup>

Starting from the early decades of the 20th Century, this new organizational form radically changed the way of performing legal work and the very nature of the legal profession. To begin with, the so-called Cravathism transformed the classic work of advocates into professionally driven corporate counseling. Perhaps the most important sociological consequence of these developments was the occurrence of a generational shift in legal elites worldwide. While in the old days, elite lawyers relied on family capital to legitimize themselves,<sup>31</sup> the younger generation of Cravath lawyers, for the most part at least, lacked the symbolic capital embodied in and accumulated by families and, for this

<sup>23</sup> (Boon 2011).

<sup>24</sup> In 2014, however, an inter-ministerial committee set up by the Danish goverment as part of the Growth Package 2014 has been working toward analyzing the situation concerning the liberalization of the legal profession. (Okholm 2015).

<sup>25</sup> (Stevens 1987).

<sup>26</sup> In the hundred years from 1850 to 1950, the world witnessed major technological developments, such as the discovery of electricity and the replacement of old means of transportation with cars, airplanes, and space rockets, as well as of communication with telephones and computers. For an overview of this, see (Cambridge Strategy Group 2018, p. 12).

<sup>27</sup> (Galanter and Palay 1991).

<sup>28</sup> (Swaine 1946) Other lawyers such as Walter S. Carter and Louis D Brandeis have developed similar arrangements contextually to Cravath. See, for instance, (Hobson 1986).

<sup>29</sup> (Galanter and Palay 1991, p. 9).

<sup>30</sup> Ibid. p. 28.

<sup>31</sup> (Dahrendorf 1969).

reason, they needed to find other ways to accumulate capital.<sup>32</sup> Accordingly, they invested substantial resources in legal education, while at the same time, turned their attention toward the world of business. This combination of merit, social class, elite school ties, and a commercial approach to the profession allowed them to become the new and powerful legal elite and to gain immense power in the state and economy. Some of the partners of these large law firms ended up even becoming part of the American and European ruling class.<sup>33</sup>

When read through the lens of Weberian sociology, the high level status achieved by the early Cravath lawyers is a consequence of the fact that their professional trajectory substantially overlapped with the broader process of rationalization of law and the rise of legal specialists in advanced capitalist societies.<sup>34</sup> Throughout the first half of 20th century, large law firms and their lawyers projected an ideal of traditional (although revolutionary for the time) professionalism, which predicated strict adherence to the profession's code of ethical conduct and a private practice at the service of both private clients and the public interest. As put by Robert Nelson: "Occupying the most prestigious segment of the profession, free from economic dependence on any given client, the large firm seemed to be a bastion of professional autonomy. In private practice the large-firm lawyer was deemed to be in a position to exert a positive moral influence on the powerful corporate actors he represented. In public affairs he was motivated not by narrow self-interest but by a commitment to enhancing the fairness and rationality of the law as an instrument of ordering society."<sup>35</sup> In other words, while slowly transforming the practice of the law into a commodity to be bought on the marketplace at a very high price, early large law firms lawyers portrayed an image of themselves as politically committed individuals, who identify with noble political ideals, such as the nation-state, democracy, human rights, and civil society. As put by Yves Dezalay and Bryant Garth: "As Kantorowicz noted some time ago, the king's notaries on the European Continent had to distance themselves from their master in order to serve him better. Similarly, we can suggest that Wall Street lawyers serving the robber barons of the nineteenth century gained a distance from their clients in part through the emerging antitrust law and the Progressive Era regulation more generally, and that the distance and investment in the law made them both more valuable and more legitimate."<sup>36</sup> In particular, this capacity of manipulating the law in favor of powerful clients, while at the same time, maintaining an aura of moral entrepreneurs promoting ideals of pure law, professionalism, and justice granted these lawyers a high status in American and European societies.<sup>37</sup> The reproduction of this power elite was then supported by the high economic, social, and cultural barriers of entry in the profession, which served as a filter to restrict access of a very limited number of newcomers. Particularly relevant in this regard were the high cost of the studies and the long years of apprenticeship required to become a part of the elite which obviously favored those in possession of the most social and economic capital.<sup>38</sup>

<sup>32</sup> (Dezalay and Garth 2004, p. 621) In this paper, the two authors discuss the different situations in Europe and in the United States.

<sup>33</sup> Ibid. p. 624. See also, (Smigel 1969). By elite lawyers or lawyers belonging to the ruling class, I mean members of the legal profession who have a strong influence both on the production of professional ideology and more generally on public life. As to the first, elite lawyers are those that produce a language that is ratified by the state and then used to justify and legitimate what lawyers do. As to the second, elite laywers are those that enjoy a close connection with national fields of state power. As shown by much sociological research on the legal profession, lawyers often play multiple roles in society in addition to exercising private practice. Lawyers act as founding fathers, interpreters of constitutional norms, advisors to holders of state power, brokers, politicians, agents of colonialism and imperialism and so on. See, among others, (Dezalay and Garth 2011).

<sup>34</sup> See, in general, (Weber 1978).

<sup>35</sup> (Nelson 1988, p. 271).

<sup>36</sup> (Dezalay and Garth 2004, p. 618).

<sup>37</sup> Some scholars have shown how this idealistic representation of professionals as guardians of public interest and common good was not entirely in synch with the reality of the profession also in the early days. In particular, Magali Sarfatti Larson analyzed how the construction of this narrative was part of the broader process of professionalization of the lawyers as a corporatist strategy of ganing power and constructing a monopoly (Sarfatti Larson 1977). However, for the purpose of the brief historical reconstruction of the role of elite lawyers in society, the generalization that early large firms lawyers presented themselves as private and public enganged professionals still stands.

<sup>38</sup> (Bourdieu 1998).
