Law students: are you 'commercially aware'?

In the world of legal graduate recruitment, commercial awareness is crucial. But the term can be confusing for those who are applying for training contracts and vacation schemes.

Often, students don’t get the training contracts or vacation schemes they apply for because of a lack of commercial awareness. One such student is Connor Bingham, a third-year exchange student from the University of Warwick, currently at the University of Utrecht, who finds the term ambiguous.

He says: “After applying to Allen & Overy and Clifford Chance and passing the aptitude tests, I failed at the CV stage due to a lack of commercial awareness. I saw others travelling to conferences, dinners and talks in an attempt to rectify this.

“I thought I knew something about the business world, perhaps more so than many of my ‘commercially aware’ friends. I just had no proof, or concept of what I was trying to prove,” says Bingham.

Joshua Littlefield, a final-year law student at the University of Hull, was unsuccessful with vacation schemes because he also failed to show commercial awareness. But once he grasped the term and how it’s used, he secured a placement with Stamp Jackson & Procter.

“In my experience, high street firms and magic circle firms look for different aspects of commercial awareness. I’ve been told by magic circle firms to read the Financial Times. However, commercial awareness is also about needing to know the state of the legal market. After realising the difference, I received offers for vacation schemes,” says Littlefield.

For students hoping to enter legal practice, understanding commercial awareness is useful and ever more desirable to employers, says Stuart Malawer, a distinguished service professor of law and international trade at George Mason University.

“Commercial awareness in a global context is necessary to adequately represent clients in international transactions. Mere legal knowledge is not enough. You need to understand the industry and many factors relating to it.”

Malawer adds: “It’s relevant if you’re pursuing individual ventures globally or domestically – involving business or otherwise.”

Dr Dan Awrey, associate professor of law and finance at the University of Oxford, says: “Commercial awareness is one of those terms that’s frequently used but seldom defined. In law school, the focus is usually and quite rightly on the law itself. In practice, however, a lawyer’s understanding of the law is an instrumentality that clients want to leverage to navigate the legal system in pursuit of their own objectives. For example, how can my client manage the resulting risks?

“Commercial awareness can then be understood as a function of the lawyer’s ability to translate their legal expertise into better outcomes for clients,” says Awrey.

So what does it actually mean?

Andrew Austin, graduate recruitment partner at Freshfields Bruckhaus Deringer, says: “We want students to be able to show that they have a genuine interest in the business world and an understanding of some of the big issues. So when a candidate comes to an interview for a training contract, we try to see if they can see things from a commercial perspective. We don’t ask candidates to demonstrate technical knowledge – we ask more general questions, like; why might a company be interested in selling its products in India or China?”

Austin adds: “Developing business-related and entrepreneurial skills through societies and work experience can also help a candidate demonstrate commercial understanding. My advice to students would be to watch the news, read the broadsheets and follow The Economist on Twitter, which gives a good weekly overview of what’s going on in the world.”

Knowledge of commercial affairs isn’t only crucial for those hoping to pursue careers in corporate law. Katie McCay, a third-year law student at the University of Cambridge who secured a vacation scheme with Pinsent Masons, says: “The firm I applied to specialises in construction and energy. It was really important to look at what was going on in the renewable energy sector as well as the emerging businesses in the sector.”

She advises students to look at law firms’ websites for information about the deals they’re working on, and to think about how changes in the law may affect particular firms in the future.

McCay adds: “Before I applied, I was up-to-date with current affairs and how well the firm was doing. I had also set up a Google alert, which notified me when a specific relevant keyword or term appeared in the news. I would then follow up the newspaper articles. I also read the Financial Times and Lawyer2b which were available at the law faculty for free.”

For any law student, it’s not just about studying the law; being a lawyer requires far greater skill than just quoting a statute. Convince employers that you’re going to help move their business forward, beyond just obtaining a vacation scheme or a training contract.

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