2021 Latin Lawyer Elite firm
About a decade ago, Mattos Filho, a then 32-partner firm, highly successful in tax and financial matters but unknown in many other key practice areas, took a bold step. The firm completely reformed its partner compensation system and set course on an expansion project that changed its fate for good. In addition to making the system more collaborative – the firm adopted a modified lock-step system – the reform paved the way for the addition of new partners, enabling the firm to expand rapidly.
There were bumps along the way. Some key partners left as the firm implemented difficult internal adjustments that shook up departments and forced multidisciplinary collaboration. Market commentators raised questions about the speed of the expansion, saying it would spoil the firm’s culture and damage the quality of service. Yet year after year the firm pursued its aim to become a corporate institution with determination. In the 10 years following the critical moment when Roberto Quiroga kickstarted the revolutionary reorganisation, Mattos Filho has raised itself to the pinnacle of the Brazilian legal market. With 118 partners by mid-2021, it is the largest firm by equity partners together with Pinheiro Neto Advogados. Mattos Filho boasts leading departments in all key practice areas of Brazilian law. It has built an institutional powerhouse, which includes corporate-style departments dedicated to finance, business development, human resources, marketing and information technology. It has surpassed the scope of a traditional Brazilian law firm to display a structural framework common to US and English firms, but rarely seen in Latin America.
While not all ventures pay off as expected and some partners leave along the way – only two in 2020 – there is no doubt the firm took the right path. Year after year the main strategy remains; while Brazil’s legal market increases, Mattos Filho will grow too. Nine new partners joined in 2020 (compared to 12 in the previous year), with six of them being promotions. The lateral moves reinforced smaller practice groups such as white-collar crime, which it first opened in 2017, and environmental law. These are the type of areas the firm is nonetheless determined to expand. Since the start of 2021, the firm has announced the appointment of 12 new partners, nine of them through promotions. The lateral moves strengthened the mining, banking and finance and capital markets groups.
Besides its determination to expand, the firm stands out for its creativity and ability to innovate. It ably combines those characteristics to achieve its goal to grow, also without new hires. In 2020, the firm opened an office in Campinas and relocated a group of lawyers, including two partners, from São Paulo. By relying on its existing expertise and talent Mattos Filho also launched an ESG practice, which is coordinated by five partners from its capital markets, private equity, human rights, environmental and real estate practices, making it one of only a few in the local market. A year before, the firm opened an aviation department by hiring a partner dedicated to the industry.
The firm’s creativity also stands out in terms of client relations. It is working with an external consultancy to outline a strategy to further penetrate the market and to attract more of what the leadership refers to as corporate clients, who come to the firm for all their legal needs.
Mattos Filho has thriving practice groups across multiple areas. The labour and litigation departments have been active in the past year, both having been allocated significant resources in the previous year. The disputes practice group, which once played a supporting role, now has more than 10 partners and has seen remarkable revenue growth over the last decade.
With such an alignment of talent and strategy, it comes as no surprise that Mattos Filho maintains a top position in the market for transactional matters, often topping lists when it comes to deal activity, both for capital markets and M&A. Both departments have recorded strong years recently, particularly with the explosion of Brazilian IPOs in the second half of 2020, a trend that has continued in the first months of 2021. In addition, the firm has top-tier teams for tax, insurance and oil and gas. In the latter it frequently represents winners in all oil auction rounds in Brazil advising major international companies.
In terms of clients, very few firms advise a greater number of Latin America’s largest companies than Mattos Filho. The survey ‘Who Represents Latin America's Biggest Companies’, published by the Latin American Corporate Counsel Association, which is affiliated to Latin Lawyer, found that Mattos Filho represents no less than 42 of the 100 biggest companies in the region.
Mattos Filho has its eyes firmly focused beyond Brazil’s borders. While its core client base was traditionally Brazil-heavy, as opposed to investors from abroad, there is now more of a balance and the firm is investing heavily in its lawyers’ international exposure. In 2020, 12 lawyers were on LLM courses abroad and 35 were spending time as foreign associates in international firms, as well as in Mattos Filho’s offices in New York and London. In a separate learning initiative, Mattos Filho launched a training programme in collaboration with Fordham Law School in New York. During three months in the first half of 2021, one-hour sessions are offered twice a week for lawyers globally about structural issues in law firm management, with a vast list of law firms and academic speakers.
Mattos Filho is also breaking new ground when it comes to social responsibility. It has a partner completely dedicated to pro bono, as part of its 100% pro bono initiative. Mattos Filho has an internal diversity focus group, Soma, aimed at promoting racial diversity within its ranks and to which it constantly allocates resources. The Mattos Filho Institute, an independent initiative financed voluntarily by partners and launched in 2017, is already providing scholarship opportunities to students from poor backgrounds. The goal of such initiatives, the firm says, is not only to give back to society but also to attract and retain talent that before would only look at the public or third sectors when selecting career options.
In response to the challenges posed by the covid-19 pandemic, the firm launched the mental health programme Minds to support its employees while working from home and to prevent depression. All of these initiatives fit within Mattos Filho's bigger strategy to increase the firm’s role in society to form future leaders and make Brazil a better country.
Throughout the years, Mattos Filho has not only proved doubters wrong, but it has also served as an inspiration for other ambitious firms. Even the firm’s early critics are now copying its model. While they do, Mattos Filho looks to the future with excitement as well as humility, aware that the market is constantly seeing more competitive and better organised firms.
Former managing partner José Eduardo Carneiro Queiroz’s premature death in June 2020 came as a shock to the firm. His hard work to reorganise Mattos Filho and develop it into a strong institution, something he handled with vigour, was one of many important legacies he left and one that helped his colleagues ride out the tragic event. One of his achievements was to make partners have difficult conversations when needed and face up to problems instead of letting them worsen. The decision to let Quiroga lead the firm, although temporarily at first, once again was an easy decision for the partnership. Few understand the ethos and the evolution the firm has undergone as well as him. Quiroga’s initiative early on in his last tenure between 2009 and 2015 to introduce a merit-based compensation system was crucial to support Mattos Filho’s ascendancy. With a tight-knit management committee, the firm has a crucial determination with which it pursues its goals. To sustain the firm’s aggressive growth plan, a structured organisational approach remains paramount for standardising high levels of service across different teams and Quiroga is tasked once again with spearheading that plan.
The firm’s commitment to transparency is also laudable. In a market in which public discussion of law firm finances is anathema to most, Mattos Filho publishes an annual report with revenue figures.
The significant investment the firm has made in its training programme is also key. Associates benefit from a clear and structured assessment for career progression, which is frequently reviewed. Promotions are assessed by a committee and are never decided by a single partner. The firm hires a high number of interns and trainees each year, recruiting 151 in 2020. All trainees spend periods in the tax, corporate and litigation departments and a fourth area of their choice before being allocated a department.
The firm also supports the development of its teams with constant training in the Mattos Filho Academy. Training sessions take place at a new building within walking distance from its São Paulo headquarters. Lawyers have training sessions with partners and professors from Brazil’s most prominent business school, FGV-SP, which has a partnership with the firm. In 2020, the firm did an internal 360-degree review among all lawyers, in which partners and associates review each other. It also did a separate partnership evaluation working with an external consultancy.
Mattos Filho also introduced an opportunity for sabbaticals at two stages of the partnership career path. The first is after 10 years of partnership when a partner can apply for three to six months of paid leave to dedicate him or herself to a personal goal. The second occurs after 20 years of partnership when the partner can apply for up to 12 months of paid leave. This provides a period of reflection and normally takes place when a partner is around 60 years old.
The firm has addressed the often complicated issue of succession. The firm is relatively new, and the only retired lawyers are name partners Ary Oswaldo Mattos Filho, Pedro Luciano Marrey Jr and Otávio Uchôa da Veiga Filho. Their retirement was subject to separate negotiations. Going forward, partners will retire compulsorily at the age of 65. In 2019, the firm fully implemented a pension system that is funded by partners while they are active, meaning future generations are not burdened by debt. This all builds on the premise of Mattos Filho’s institutionalisation project, where no partner is more than the firm.
Roberto Quiroga was re-elected managing partner in March 2021 and will steer the firm until 2024. He temporarily held the role from July 2020 following the passing of José Eduardo Carneiro Queiroz. Quiroga held that post between 2009 and 2015 and is backed by a 10-partner executive committee: Eduardo Damião Gonçalves, Fabio Teixeira Ozi, Glaucia Lauletta Frascino, João Ricardo de Azevedo Ribeiro, Marcelo Mansur Haddad, Marina Anselmo Schneider, Marina Procknor, Pablo Sorj, Pedro Whitaker de Souza Dias and Renata Correia Cubas.
In addition to its headquarters, Mattos Filho has a separate building in São Paulo that hosts not only the Mattos Filho Academy but also a multimedia studio and the new pro-bono division, among other departments. Its office in Rio de Janeiro is bigger than all other São Paulo firms in the city and competes well with local rivals in Brazil’s second-biggest legal market. The firm has also offices in Brasília, Campinas (since 2020), New York and London.