King & Wood Mallesons Reviews Global Strategy

King & Wood Mallesons is keeping its global structure open to change as shifting regional dynamics and geopolitical pressures challenge the stability of its long-standing Sino-Australian legal alliance.

The firm, formed from a 2012 merger between China’s King & Wood and Australia’s Mallesons Stephen Jaques, is reassessing its cross-border structure. While it previously highlighted the value of its integrated model, recent developments including reduced investment between China and Australia have led to a more flexible outlook. The Australian partnership has avoided explicitly restating its commitment to the current setup. Instead, it is pointing toward a more adaptable approach that reflects changing market conditions.

Tensions have increased across the network due to leadership changes and legal challenges. Over the past year, a former global executive from the Chinese side has encountered financial difficulties, including an unpaid loan of significant size, despite having held senior roles. The Hong Kong office, which previously served as the link between the Chinese and Australian partnerships, has become more profitable. However, its financial independence has made firm-wide accountability more complicated.

Behind the scenes, legacy financial arrangements from the original merger are still relevant. Australian partners have received returns from Hong Kong operations after having initially invested in their expansion. Internal scrutiny has grown in light of longstanding issues and the slow pace of appointing key global executives.

Broadly speaking, King & Wood Mallesons is trying to manage a careful balance by preserving the strengths of its global network while moving away from higher-risk associations. The approach taken by the Australian partnership could indicate a broader shift in how global law firms respond to increasingly complex regional and governance challenges.

Source: Australian Financial Review, King & Wood Mallesons, Financial Times