In the United States, white-shoe firm is a term used to describe prestigious professional services firms that have been traditionally associated with the upper-class elite who graduated from Ivy League colleges. The term is most often used to describe leading old-line law firms and Wall Street financial institutions, as well as accounting firms that are over a century old, typically in New York City and Boston.[1]
Former Wall Street attorney John Oller, author of White Shoe, credits Paul Drennan Cravath with creating the distinct model adopted by virtually all white-shoe law firms, the Cravath System, just after the turn of the 20th century, about 50 years before the phrase white-shoe firm came into use.[2]
Etymology
The phrase derives from "white bucks", laced suede or buckskin (or Nubuck) derby shoes, usually with a red sole, long popular among the student body of Ivy League colleges.[3] A 1953 Esquire article, describing social strata at Yale University, explained that "White Shoe applies primarily to the socially ambitious and the socially smug types who affect a good deal of worldly sophistication, run, ride and drink in rather small cliques, and look in on the second halves of football games when the weather is good."[4] The Oxford English Dictionary cites the phrase "white-shoe college boys" in the J.D. Salinger novel Franny and Zooey (1957) as the first use of the term:[5] "Phooey, I say, on all white-shoe college boys who edit their campus literary magazines. Give me an honest con man any day."[6] It also appears in a 1958 Fortune article by Spencer Klaw, which describes some firms as having "a predilection for young men who are listed in the Social Register. These firms are called 'white-shoe outfits', a term derived from the buckskin shoes that used to be part of the accepted uniform at certain eastern prep schools and colleges."[7]
Usage
The term originated in Ivy League colleges and originally reflected a stereotype of old-line firms that were populated by White Anglo-Saxon Protestants (WASPs). The term historically had antisemitic connotations, as many of the New York firms known as white-shoe were considered inaccessible to Jewish lawyers until the 1960s.[5][8] The phrase has since lost some of this connotation, but is still defined by Princeton University's WordNet as "denoting a company or law firm owned and run by members of the WASP elite who are generally conservative".[9] Most white-shoe firms also excluded Roman Catholics.[10][11][12][13] A 2010 column in The Economist described the term as synonymous with "big, old, east-coast and fairly traditional."[14] In the 21st century, the term is sometimes used in a general sense to refer to firms that are perceived as prestigious or high-quality; it is also sometimes used in a derogatory manner to denote stodginess, elitism, or a lack of diversity.[5]
Examples
The following U.S. firms are often referred to as being white-shoe firms:
Accountancy
The current Big Four accounting firms and the former Big Eight auditors from which they merged:
- Deloitte (merged from Deloitte Haskins & Sells and Touche Ross)
- Ernst & Young (merged from Ernst & Whinney and Arthur Young)
- KPMG (formerly Peat Marwick Mitchell)
- PricewaterhouseCoopers (merged from Price Waterhouse and Coopers & Lybrand)
The only former Big Eight firm not merged into one of the Big Four was Arthur Andersen, which went out of business in 2002 after the Enron scandal.
Banking
- Traditional
- Brown Brothers Harriman & Co.
- Dillon, Read & Co. (acquired by UBS in 1998)
- First Boston (acquired by Credit Suisse in 1990)
- Kuhn, Loeb & Co. (merged with Lehman Brothers in 1977)
- J.P. Morgan & Co.[15][16] (merged with Chase Manhattan in 1996, and became JPMorgan Chase in 2000)
- Morgan Stanley[17]
- White Weld & Co. (acquired by Merrill Lynch in 1978)
- Modern
Management consultancies
The Big Three (management consultancies), colloquially known as "MBB", consisting of the largest management consulting firms by revenue:
Law
- Traditional
- Arnold & Porter[22]
- Cadwalader, Wickersham & Taft[23]
- Covington & Burling[24]
- Cravath, Swaine & Moore[25]
- Davis Polk & Wardwell[26]
- Debevoise & Plimpton[27]
- Milbank, Tweed, Hadley & McCloy[28]
- Ropes & Gray[29]
- Shearman & Sterling[30]
- Sidley Austin[31][32]
- Simpson Thacher & Bartlett[33]
- Sullivan & Cromwell[34]
- White & Case[35]
- Willkie Farr & Gallagher[36]
- WilmerHale[37][38][39]
- Modern
While the term "white-shoe" historically applied only to those law firms populated by WASPs, usage of the term has since been expanded to other top-rated prestigious firms. Many of these firms were founded as a direct result of the exclusionary tendencies of the original white-shoe firms, which provided limited opportunities for Jewish and Catholic lawyers, as well as other non-WASPs, and include:
- Akin Gump Strauss Hauer & Feld[40]
- Cahill Gordon & Reindel[41]
- Cleary, Gottlieb, Steen & Hamilton[42]
- Fried, Frank, Harris, Shriver & Jacobson[43]
- King & Spalding[44][45][46]
- Latham & Watkins
- Paul Hastings
- Squire Patton Boggs
- Paul, Weiss, Rifkind, Wharton & Garrison[47][48]
- Proskauer Rose[49][50][51]
- Quinn Emanuel Urquhart & Sullivan[52]
- Skadden, Arps, Slate, Meagher & Flom[53][54]
- Wachtell, Lipton, Rosen & Katz[55]
- Weil, Gotshal & Manges[56][57][58]
Equivalent law firms outside the United States
- Australia
- Big Six: In 2012, three of these firms merged with overseas firms, and one other began operating in association with an overseas firm. As a consequence, it has proposed that the term is no longer applicable to the Australian legal profession, displaced by the concept of Global Elite law firms or International Business law firms.[59]
- Brazil
- Grandes Firmas: Pinheiro Neto Advogados: Mattos Filho Advogados : Machado Meyer Advogados: Tozzini Freire Advogados: Veirano Advogados
- Canada
- Seven Sisters
- China (People's Republic)
- Red Circle, coined by The Lawyer magazine in 2014.[60]
- Japan
- Big Four
- South Africa
- Big Five
- Singapore
- Big Four
- United Kingdom (centered on the City of London)
- Magic Circle, firms with the largest revenues, the most international work and which generally outperform the rest of the London market on profitability.
- Silver Circle, the next tier below the Magic Circle (there is no Golden Circle[61]) has firms smaller than those in the Magic Circle, though sometimes with similar level of profits per equity partner (PEP) and average revenue per lawyer.[62][63][64]
References
Further reading
- Wald, Eli, "The rise and fall of the WASP and Jewish law firms." Stanford Law Review 60 (2007): 1803-1866 online
External links
- Chambliss, Elizabeth (September–October 2005). "Terms of Art". Legal Affairs.
- Lin, Anthony (May 10, 2006). "Can the 'Jewish Law Firm' Success Story Be Duplicated?". New York Law Journal.