The professionals behind KPMG Law share their views on the legal sector

Kyriacos Theodorides, Panayiota Georgiou and Alkistie Iacovou – the three partners of Theodorides, Georgiou & Iacovou LLC, a law firm established in July 2022 as KPMG Law, member of the KPMG Global Legal Network – talk to GOLD about business cycles, the role and influence of technology and the evolution of the legal profession.

Let’s get the obvious question out of the way: why spin a law firm out of KPMG Cyprus in the first place?

Panayiota Georgiou: Let’s clarify that KPMG was not offering advocacy services but only legal services because that’s what was permissible at the time. Lawyers within KPMG, though, unavoidably developed a certain level of business acumen. After ten years of discussions, we decided that the time had come to set up a fully-fledged law firm that does not offer traditional law services but an advanced legal business service solution.

You are not just dotting the i’s and crossing the t’s, then?

Panayiota Georgiou: No, we are not paper pushers. Actually, the lawyers within KPMG are project managers first and they align their legal servicing with the client’s operational needs. I’ll give you an example: when a client goes to their lawyer and says, “I’ve spoken with my accountant and I want you to reduce my company’s share capital by X amount,” the first thing we’ll say is, “OK – give us the balance sheet.” We will first assess what they can and cannot do and then advise them on a holistic business basis.

And it’s fair to say that being in the KPMG network gives you a head start compared to other newly established firms – you already have an existing client roster.

Alkistie Iacovou: Yes, there was a business transfer. We need to mention, though, that every new client we onboard still needs to go through all KPMG’s procedures. While rigorous at times, our procedures help mitigate risks, avoid liabilities and prevent any reputational damage.

Two of you have been with KPMG Cyprus for 13 and 6 years respectively and you formed the backbone of the firm. Then you, Kyriacos Theodorides, arrived in January 2023, having worked for 20 years as a partner at Georgiou Y. Yiangou LLC.

Kyriacos Theodorides: And, before that, for 10 years at Tassos Papadopoulos & Associates LLC.

I imagine your reasons for joining KPMG Law were different from those of your new partners.

Kyriacos Theodorides: When I was approached, I thought that by joining KPMG we could increase our service offering to a much larger market, especially in my area of expertise, which is litigation. So, I thought that by bringing my expertise to the team, there was a good chance of expanding the business in the local market and abroad. It was not an easy decision, though. I was leaving a law firm that focused exclusively on legal matters for a completely different culture but people have been helping me to adjust. It will take a bit of time, but we are getting there!

You are the litigation expert, so what do the others bring to the table?

Alkistie Iacovou: I am the Risk Management partner.

Panayiota Georgiou: And I’m the Head of Business, specialising in business law.

How big is your team?

Panayiota Georgiou: Our legal team consists of 24 professionals operating from Nicosia, Limassol, Larnaca and Paphos.

Let’s turn to challenges. The professional services sector in Cyprus has taken a hit from the war in Ukraine since the subsequent sanctions against Russia forced firms to drop clients. How has that affected a new firm like yours?

Alkistie Iacovou: It’s a very uncertain situation because the sanctions are continuously evolving. Since February 2022, we have seen 10 packages published in relation to sanctions that eliminate the possibility of servicing Russian clients. So, yes, to a certain extent, we have been affected. However, the actual impact on our law firm was minimal.

Panayiota Georgiou: Let’s put it in perspective: we didn’t drop any clients and, as a law firm, we didn’t have any significant exposure to sanctions. Clients that have been with us for years are not necessarily related to any one market, which is currently problematic. Plus, we do not work within a single market – our reach is global. So, in terms of risk, we can absorb the impact, utilizing our resources, experience and relationships with other markets.

Kyriacos Theodorides: And in such a complex situation, you have to look into new sectors and new aspects of the law. You know what they say: Don’t put all your eggs in one basket. Even though the impact was not that great, as Panayiota and Alkistie have mentioned, it’s always good to look ahead and find new sectors, like shipping and technology, and technology, that you can invest in with people or expertise to fend off similar situations.

How would you go about doing that?

Panayiota Georgiou: To some extent, you cannot just look at trends; the last decade has been crazy with all the crises. There are patterns you can follow, though. When M&A activity is low, we see a boost in reorganisations and insolvency, and when it is high, there is a tilting of the balance. Business runs in cycles.

Kyriacos Theodorides: I was involved in litigation for 29 years, mostly in banking and corporate law. When the Cyprus Popular Bank collapsed in 2013, I was there, working as one of their external litigating lawyers. So, on the litigation front, it’s easy to see the cycle coming full circle: if money is going out, the process is to get it back in.

Where are we now in this cycle?

Panayiota Georgiou: M&A activity is currently low. Don’t get me wrong – we still service M&A transactions but not of the volume and size we used to a few years ago. COVID-19 spurred a lot of activity because of the distressed market. Now, we are shifting to reorganisations and restructuring and, of course, the next step will be insolvency.

Kyriacos Theodorides: The interesting thing about insolvency is that most of the companies going through the procedure are now using a receiver/manager or a liquidator to distribute

assets to creditors, rather than go through the courts. For law firms, this is a very interesting market. This is happening a lot more, in Cyprus and abroad, since it is much more cost-effective and timesaving.

How does technology open doors for new law firms like yours – which are essentially advisors to clients and not just business opportunities – and how does it affect the way firms interact with their clients?

Alkistie Iacovou: During COVID-19, we saw a much-needed change in our sector. A lawyer working from home? It wasn’t even in the realm of possibility before 2020 but, because we were forced to work from home, we had to modernise and adopt tools that safeguard confidentiality. This has now become part of our reality.

Panayiota Georgiou: It’s true that we place a lot of emphasis on how to use technology to interact with clients; it needs to accommodate that communication. So, we use tools that allow both us and our clients to track progress and results, to keep up with legal and regulatory developments that can affect their business, and we even leverage data analytics that will produce insights. This not only enables clients to do their work but also puts us in a better position as regards the sort of advice we give them. Technology helps us create relationships with clients that are no longer based on just doing legal work.

Alkistie Iacovou: And with all these tools, clients are now more demanding; social media apps essentially make everyone reachable 24/7, so clients expect us to be available at all times. However, at the end of the day, the most essential part of our job is to maintain a balanced relationship with our clients.

Panayiota Georgiou: I was actually at a legal conference recently, and one of the main topics of discussion was ‘How the relationship between lawyer and client has been eroded’. Some people see lawyers and think only of billable hours. However, in reality, we are here to serve clients and their interests, much like in any other profession.

Do you think that technology will give rise to new specialisations within the law profession?

Kyriacos Theodorides: Having been around for nearly thirty years, the only way to go forward is to have a specialisation. It is why small offices have died out. So, the profession has always forced us to be a specialist in one domain rather than a jack of all trades. The way I see it, technology will enable more people to become specialists.

Panayiota Georgiou: We are also seeing a new trend where firms are hiring people who combine tech capabilities with a legal background to design law-related tools. This is part of the new breed of legal

servicing.

How do you see the firm growing in the next few years?

Panayiota Georgiou: As I always say, the sky’s the limit – we are dreaming big.

(Photo by TASPHO)

This interview first appeared in the April issue of GOLD magazine. Click here to view it.