How well did law firm leaders’ projections about industry performance during the first half of 2017 reflect what actually happened? The first-half 2017 issue of the Citi Private Bank Law Firm Leaders Confidence Index, published in January, showed a slight increase in overall confidence levels in the industry. This increase was in large part driven by law firm leaders’ confidence in the outlook for their own firms. Comparing this first-half Law Firm Leaders Confidence report to the Citi Law Watch Quarterly Flash report for the first half, released in August, we found some accurate or near accurate predictions and some notable differences, particularly as to how well law firm leaders expected their firms to perform.
Citi Private Bank’s Law Firm Leaders Confidence Index (LFLCI) is a semi-annual, forward-looking measure of confidence levels within the legal industry. The first-half 2017 LFLCI values are based on a sample of 153 firms (66 Am Law 100 firms, 39 Second Hundred firms and 48 niche/boutique firms), with responses collected in October 2016. One response was accepted from each firm and was submitted by the firm’s managing partner, executive director, chief operating officer, chief financial officer or equivalent member of the management team. The result is a composite index that shows the relative level of overall confidence based on a series of component indices. For each index, 0 indicates very low confidence, 100 indicates neutrality, and 200 indicates extreme confidence. We then compared the first-half LFLCI projections with the actual first-half 2017 results, based on 165 firms (69 Am Law 100 firms, 48 Second Hundred firms and 48 niche/boutique firms) from the Citi Quarterly Flash survey conducted for the first half of 2017. Citi Private Bank provides financial services to more than 600 U.S. and U.K. law firms and more than 35,000 individual lawyers. In addition to the LFLCI and the Quarterly Flash survey, we conduct a more detailed annual survey. These reports, together with extensive discussions with law firm leaders, provide a comprehensive overview of current financial trends in the industry as well as forward-looking insight.
