Russell McVeagh

Written By: - Date published: 8:11 am, July 6th, 2018 - 31 comments
Categories: Abuse of power, alcohol, sexism - Tags:

For those of you who have not been a junior in a large corporation, it’s reasonably easy to describe them as coal chucked by the shovelful into a fire for an enormous turbine. That turbine consists of the profits and overheads of the partnership.

They are also places of the most enormous power disparity; as the partners and senior associates drive their sleek mobile wonders into the underground car parks, faces fresh from the gym and with pretty much every societal privilege known to humanity sustaining them, there is no lack of clarity about the place of juniors in this set of strata. The young are there to work for almost-free, to enable the seniors and partners to bill cumulative hours towards very optimistic targets. Most of those partners have to pay to get to partnership – and within the partnership there is a really clear hierarchy of juniors and seniors themselves in both cost and reward. Such partners regularly die young.

We don’t have to forget that Russell McVeagh is New Zealand’s Goldman Sachs. On deals done it is the most powerful professional services entity in New Zealand and has been so for over a century. In terms of the allocation of capital around New Zealand, Russel McVeagh has no equal other than Parliament. With that prestige and power, it is the entry point to the most senior ranks of money and privilege that we have. As a partner there, when you walk into any boardroom you carry significant power.  Getting to work there is getting into the dream, however you describe the dreams of being elite, meritocratic, tough, commercial, and willing to work and endure a whole bunch in order to get rich and get partnership. It’s up, or out.

This culture got exposed this week through Dame Margaret Bazeley’s findings. Here’s a taster:

First, I found that in the past Russell McVeagh had a ‘work hard, play hard’ culture that involved excessive drinking and in some instances crude, drunken, and sexually inappropriate behaviour. Junior lawyers and other young staff were encouraged to drink to excess. After the incidents the firm moved decisively to address these issues and began to change the culture. Two and a half years later, during my review, I was not told of any recent instances of sexual harassment, sexual assault, or alcohol fuelled misbehaviour.

Second, in reviewing the firm’s response to the incidents I found failings in the firm’s governance, structure, management, policies, standards, and systems, as well as the lack of a code of conduct. These failings contributed to the poor management of the incidents of 2015-16. I found that there was no-one in charge in the Wellington office, the team within which the incidents occurred was out of control, and what was happening in that team was not noticed by the partners or brought to the attention of the Board.

Third, as part of my broader review of the firm’s culture I was surprised to hear of pockets of bullying, poor work management practices resulting in excessive work hours for junior lawyers, and fear among lawyers and partners about the potential consequences of speaking out. A recent survey of all lawyers by the New Zealand Law Society revealed that bullying and harassment are problems across the entire legal profession. This does not minimise the reality of what has occurred at Russell McVeagh, but means the firm is not alone in needing to confront these issues. To its credit, the firm has not shied away from the problems, and has moved to act immediately to address them.

Fourth, although nearly 30 percent of partners are women and progress has been made with gender equality, many talented women lawyers still leave the firm rather than progressing to partnership. This is disappointing and a big loss for the firm.

Progress has also been made in the LGBTTI and diversity areas, but ongoing work is required to address sexism and unconscious bias. I consider any form of discrimination against women to be a serious issue because it inhibits the change that is needed to achieve the complete elimination of sexual harassment and sexual assault.

Fifth, cultural change of the magnitude contemplated by this review takes persistent and consistent effort to embed. Building on the work the firm has already begun, it is imperative that the Board, Chief Executive, and every partner are committed to the proposed transformation of the firm’s culture and that they have a 10-year plan to implement, monitor, and audit the change.

As law graduates have become majority female in recent years, some policies and practices have softened. But it will remain the most incredibly hard environment in which to work. From this report there may well be further splits of the Russel McVeigh partnership into smaller competing firms who often specialise in niche legal fields.

But don’t be fooled into thinking just because they are rich and powerful, that they are the only place this kind of evil resides. It’s across the profession.

As the NZLS showed in April this year in a major study, it’s across the place. They’ve known about it for years.  Lawyers in New Zealand function as our largest and most powerful self-regulated gang chapter, and within it women get a pretty hard time of it. The female support networks have softened this, but the implied code of entry is still strong.

Sexism and bullying in the legal profession is not going to be completely eliminated. Even with changes, at the highest and most powerful legal practice in the land, the continuing test will be to retain profit, regain prestige and deal-flow, regain access to those juniors for feeding into the turbine, and making the place sufficiently attractive to women to work in that the machine of partnership keeps turning.

But done well, this could cause as great a revolution within the legal industry as the health and safety legislation did for the construction and forestry industry. Done badly, the internal revenge will be terrifying.

31 comments on “Russell McVeagh ”

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  1. Jenny 1
    6 July 2018 at 8:30 am

    It doesn’t surprise me that Russel McVeagh has a predatory and bullying in-house culture.

    It matches their predatory and bullying public persona.

    For those who can afford their services, Russel McVeagh is the vicious, no holds barred, go-to law firm for employers who want to smash unions, and for corporations who want to push through environmentally damaging business projects.

  2. marty mars 2
    6 July 2018 at 8:58 am

    Yes very expected result. After 15 years in corporations at senior levels I can say these behaviours are rife across all suited professions and industries – rife. Good some light being shone in this dark hole – thank you.

    • Treetop 2.1
      6 July 2018 at 9:18 am

      There are a number of dark holes.

      Were police barrack kitchens raised, the young women who worked in them. The live on site Sgt turned a blind eye. The way he used to glare.

      Possibly defence kichens as well.

      Kitchen assistants at police barracks generally lived on site due to the split shifts worked. 6am-9pm 11.30am-2pm 4.30pm-7.30pm.

      The hours were a killer, cops thought they had it hard.

    • tc 2.2
      6 July 2018 at 11:35 am

      +100 marty. The ‘anti bullying’ campaign has that ironic element to it when I see it about.

  3. Blazer 3
    6 July 2018 at 9:11 am

    I imagine if every Govt agency dispensed with their services,their profitability would be affected big time.
    No doubt they would then initiate court proceedings to reinstate their…pelf.

  4. adam 4
    6 July 2018 at 9:33 am

    Who would have thought, a bureaucracy/organisation with power all unto itself, takes the easy path of being evil.

    Shock, horror, the rich in this country have no morals.

    Did you miss the homelessness, people living in cars, communicable diseases on the rise, suicide rates raising, racism, poor shaming, and a generation effectively locked out of society by these same rich.

    And they want us to respect these people and the laws the support, yeah right.

    • Treetop 4.1
      6 July 2018 at 9:43 am

      The bystanders (witnesses) are nearly as bad as the perpetrators.

      The survivors are trying to survive.

  5. Blazer 5
    6 July 2018 at 9:47 am

    The form’ of NZ’s ‘foremost law firm’..

    ‘Thirty Pieces of Silver – Anthony Molloy QC
    Paperback – good condition- 419 pages- published 1998

    What you are about to read may form the starting point of the most serious investigation into legal ethics in New Zealand’s history.

    Every person who has ever had reason to question the ethics of a lawyer will fInd this book compelling, as one of the country’s most respected jurists, Dr Anthony Molloy QC, examines the conduct of his own profession specifically the country’s self-proclaimed top law firm: Russell McVeagh McKenzie Bartleet & Co.

    Dr Molloy analyses what drives the modern commercial lawyer and investigates specific examples where ethics have given way to greed, and that greed has deprived Inland Revenue, and sometimes-even clients, of millions of dollars.

    He alleges that Russell McVeagh McKenzie Bartleet & Co has assisted clients to commit fraud and, in doing so, have themselves aided that fraud. From this, Russell McVeagh McKenzie Bartleet & Co have profited.

    This book pulls no punches! Dr Molloy QC names names, and outlines what ethical and criminal misconduct appears to have arisen in pursuit of… Thirty Pieces of Silver.
    he has written will have a devastating impact on lawyers and the judiciary. Whether a formal investigation by authorities is launched into his findings remains to be seen; what is clear is that the legal profession must now seriously examine its ethics.

    • Anne 5.1
      6 July 2018 at 10:28 am

      I have the book “Thirty Pieces if Silver”. I don’t profess to have understood all the legalise but it was a shocker in terms of the exposure of unlawful and corrupt practices adopted by our wealthiest citizens and their equally wealthy lawyers most of whom hailed from Russell McVeagh. These people diddled NZ tax payers out of untold millions – if not billions – of dollars during the 1980s and early 1990s. No wonder they all live overseas in tax havens and the like where they can’t be touched.

      I was told by a senior politician years ago that the reason they escaped prosecution was because the enormous cost trying to track them and their money trails down was just too prohibitive for a small country like ours. So they got away with it!

      • Blazer 5.1.1
        6 July 2018 at 11:14 am

        Don’t accept this at all…political patronage imo.

        ‘I was told by a senior politician years ago that the reason they escaped prosecution was because the enormous cost trying to track them and their money trails down was just too prohibitive for a small country like ours’.

        • Anne 5.1.1.1
          6 July 2018 at 11:59 am

          Sorry Blazer I wasn’t explicit enough. I was referring to the police decision not to conduct an investigation. It was they who apparently chose not to… on the basis of the enormous resources involved. The senior politician was retired by that time but would have heard about the decision via the internal Beehive grapevine.

    • Ad 5.2
      6 July 2018 at 10:29 am

      That book did more to enhance than detract from their reputation overall: if you want a deal done in New Zealand, that’s the team.

  6. Dennis Frank 6
    6 July 2018 at 10:29 am

    The legal profession is last bastion of the residual patriarchy. One suspects it is now under attack from the forces of progress – but don’t underestimate the substantial track record established by liberals in all western countries in their concerted effort to stall progress wherever possible.

    The strategy liberals use is to create the semblance of progress while ensuring that their collusion with conservatives is never really threatened by any actual progress. I predict, therefore, that we’ll see plenty of window-dressing. Tokenism, in which women will be deployed in advisory or liaison roles, for instance.

    What we will not see is any structural change that makes the legal profession accountable to the public. Such enforcement of accountability for poor performance would render the patriarchy dead in the water. You haven’t noticed any organised call for that from women, have you? They help powerful men by ignoring that elephant in the room. Liberals will respond by pointing out that the profession enforces accountability on members itself so it doesn’t need to be made accountable to the public. A sick joke: organised cover-ups are what happens. A public body established by act of parliament to provide natural justice for anyone victimised by the legal profession is the only credible solution.

    • Anne 6.1
      6 July 2018 at 11:00 am

      A public body established by act of parliament to provide natural justice for anyone victimised by the legal profession is the only credible solution.

      Yes it is the only solution but in a way the horse has bolted. It should have been established 20 plus years ago and should also have included the Public Service. The problem: 20 plus years ago the ‘powers that were’ were themselves in cover-up mode, or in total denial that anything untoward was occurring.

      • Dennis Frank 6.1.1
        6 July 2018 at 3:24 pm

        Yeah the Labour/National establishment are always dead keen on re-arranging the deckchairs instead of steering away from the iceberg. It’s now up to younger generations to grab the steering wheel. We can but hope they’ll suss out that moral indignation is merely a phase to pass through on the way to corrective action.

  7. Philj 7
    6 July 2018 at 11:10 am

    The investigation was very limited and failed to name any one involved at the firm. Dissapointing but not surprising.

  8. AB 8
    6 July 2018 at 11:51 am

    Lots of wittering on about ‘culture’ and ‘changing the culture’, as though organisational culture was a free-standing thing without antecedents.
    Which is nonsense. The organisational culture at RM is simply a superstructure, just one particular form of expression of deep structural problems that run across the whole of society:
    – the concentration of wealth and power in a few hands
    – pervasive workplace structures of hierarchy, authority and dominance
    – a pervading ethos of self-advancement through whatever means you can get away with
    So yeah – totally unsurprising.
    You might be able to ‘fix’ the culture at RM for a brief time (breaking the firm up and making all the senior team considerably poorer would be a good start), but another manifestation of the underlying toxicity will pop up somewhere.

  9. Treetop 9
    6 July 2018 at 3:13 pm

    I have just seen online what Helen Clark has to say about Russell Mc Veagh.

    I would like to see Clark take over from Bazeley in any future inquiry regarding unbecoming or unlawful sexual behaviour.

    The opposition would probably kick up a stink. Other former PMs have gone on to head an inquiry.

    • Tuppence Shrewsbury 9.1
      6 July 2018 at 5:37 pm

      Not into their own party for external release. That’d be absurd. Like Helen Clark is being atvthe moment

      • Treetop 9.1.1
        6 July 2018 at 10:03 pm

        I was not as clear as I needed to be.

        Bazley has had her day in heading inquiries. I think that Clark would do a througher job heading inquiries involving issues concerning woman. Human rights issues also.

        It is nearly a decade since she was a politician.

    • rightly or wrongly 9.2
      6 July 2018 at 8:16 pm

      She’s too busy trying to shut down charity concerts.

      A bit of noise is far more important than saving the lives of babies.

      • Jilly Bee 9.2.1
        6 July 2018 at 9:02 pm

        Just wondering ror whether you live within cooee of Eden Park. I’ve often been there for rugby or cricket games and have heard the roars of the patrons from well outside the arena, let alone rock bands and their ilk.

  10. RedBaronCV 10
    6 July 2018 at 7:07 pm

    Well think that a union for all law staff below a certain level over all firms should have been recommended. Costs to be born on a per head basis by the partners of the various firms for a good number of years.
    Elections to be by secret ballot & a no sack period for the officers and those standing. If they are willing to swallow that without trying to manipulate anything then they are open to change. Otherwise they are just trying to plant a flower bed over a mess.

    Now what large firms use Russel McVeagh & do the products need a boycott to get some corporate action. Remember so far all this has cost the partners about the equivalent of a coat of whitewash and money talks

  11. Jilly Bee 11
    6 July 2018 at 9:19 pm

    My son worked for a fairly high flying legal firm in Auckland in the early 2000s. He eventually succumbed to the pressure he was supposed to endure and resigned after having a complete breakdown. He has worked for a large legal firm in Melbourne since 2009 and has recently been promoted to the role as Legal Counsel and is thriving in his new role. I guess the same situation can and does happen in other law firms overseas, but personally, I just delighted my lad can work in the line of work he loves.

  12. Eco Maori 12
    7 July 2018 at 8:11 am

    This is why Maori have lost so much land in Atoearoa because Lawyer like Russell McVeagh have be clearing the way for the wealthy of Aotearoa to rip strip and shit on Anybody who they please and hide all of there crimes and the jails are full of Maori It should have all these wealth people who ripped Maori of their whenua.
    I told everyone that the wealthy laughed at the poor common person hahaha THEY ARE HOUNEST it’s good to see the likes of these people getting there ass burned its this type of system that will get someone like trump get to the top.
    Ka kite ano

  13. Eco Maori 13
    7 July 2018 at 8:19 am

    Here’s a link that shows that shonky has caused the most damage to Atoearoa wealth giveing land to his rich M8

    https://i.stuff.co.nz/national/105146853/after-taxpayers-paid-to-get-rid-of-it-farm-sells-for-175m Ka kite ano

  14. justpassingthru 14
    7 July 2018 at 8:23 am

    Amongst law students Russell McVeagh was known as Russell McWank.

  15. Eco Maori 15
    7 July 2018 at 8:30 am

    We no that this organisation is run by the wealthy for the wealthy ie America
    Take your views elsewhere. Link below

    https://i.stuff.co.nz/business/money/105284813/imf-not-keen-on-proposed-foreign-buyer-ban-for-houses Ka kite ano

  16. Plan B 16
    7 July 2018 at 10:15 am

    Simply unbelievable comment from Andrew Little:

    Information released to RNZ under the Official Information Act shows Russell McVeagh provides legal services to 22 government agencies – earning $3.1 million in the last financial year.

    Justice Minister Andrew Little was asked if the government would cut ties with the firm now the review had been released.

    “The issue is to sort out behaviour and conduct and a culture within this professional services firm that is totally unacceptable,” Mr Little said.

    “You’ve actually got to change behaviour – I’m not sure that the government finding other law firms to instruct or brief out their work to is going to be an answer to the problem,” he said.

    Simply unbelievable response from Andrew Little
    So Andrew does not seem to understand that the only thing that Russell McVeagh cares about is money and the only way to change and modify thier behaviours is through loss of fees.

    Is he covering for them?
    Why not cut ties with Russell McVeagh?

    Very disappointed

  17. Jingyang 17
    8 July 2018 at 9:17 am

    I worked at Russel McVeagh in the mid-90s. AB is correct in the “cultural superstructure” view – the whole place is a toxic snakepit where the only survivors who make it to partner are charming snakes – who then support incoming charming snakes,and so it goes on. Shutting the whole firm down and disbarring them is the best option. Second best is for the govt (and govt funded law schools) to no longer do any business with them.