A partner in a law firm, accounting firm,

consulting firm A consulting firm or simply consultancy is a professional service firm that provides expertise and specialised labour for a fee, through the use of consultants. Consulting firms may have one employee or thousands; they may consult in a broad rang ...

, or

financial firm Financial institutions, sometimes called banking institutions, are business entities that provide services as intermediaries for different types of financial monetary transactions. Broadly speaking, there are three major types of financial inst ...

is a highly ranked position, traditionally indicating co-ownership of a

partnership A partnership is an arrangement where parties, known as business partners, agree to cooperate to advance their mutual interests. The partners in a partnership may be individuals, businesses, interest-based organizations, schools, governments ...

in which the partners were entitled to a share of the profits as "

equity partner A partnership is an arrangement where parties, known as business partners, agree to cooperate to advance their mutual interests. The partners in a partnership may be individuals, businesses, interest-based organizations, schools, governments o ...

s". The title can also be used in

corporate A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and r ...

entities where equity is held by shareholders.

Law firms

In law firms, partners are primarily those senior lawyers who are responsible for generating the firm's revenue. The standards for equity partnership vary from firm to firm. Many law firms have a "two-tiered" partnership structure, in which some partners are designated as "salaried partners" or "non-equity" partners, and are allowed to use the "partner" title but do not share in profits. This position is often given to lawyers on track to become equity partners so that they can more easily generate business; it is typically a "probationary" status for associates (or former equity partners who do not generate enough revenue to maintain equity partner status). The distinction between equity and non-equity partners is often internal to the firm and not disclosed to clients, although a typical equity partner could be compensated three times as much as a non-equity partner billing at the same hourly rate. In America, senior lawyers not on track for partnership often use the title " of counsel", whilst their equivalents in Britain use the title "

Senior Counsel The title of Senior Counsel or State Counsel (post-nominal letters: SC) is given to a senior lawyer in some countries that were formerly part of the British Empire. "Senior Counsel" is used in current or former Commonwealth countries or jurisdictio ...

". Partner compensation varies considerably. A 2012 survey by Major, Lindsey & Africa found that law firm partners' average annual compensation was $681,000 ($896,000 for equity partners, $335,000 for non-equity partners) and tended to go up based on number of years in the partnership: *5 or fewer years: $399,001 *6–10 years: $633,001 *11–20 years: $790,001 *20+ years: $926,001

Accounting firms

Accounting firms Accounting, also known as accountancy, is the measurement, processing, and communication of financial and non financial information about economic entities such as businesses and corporations. Accounting, which has been called the "language ...

were traditionally established as legal partnerships with partners sharing the profits. Today, the financial and consulting services firms which originated from accounting firms, such as the

big Four accounting firms The Big Four are the four largest professional services networks in the world, the global accounting networks Deloitte, Ernst & Young (EY), KPMG, and PricewaterhouseCoopers (PwC). The four are often grouped because they are comparable in size re ...

, retain the title of Partner as a senior position and to indicate a profit-sharing status. To become a partner is considered a significant career milestone. Based on the role, tradition or local regulations partners may include; * Managing Partner/Country Partner – Partner in charge of the day-to-day running of the business * Senior Partner – Partner of many years of service * Principal – Partner who is not a CPA/ CA A modern procedure is to take a role of Associate Partners before becoming a Partner in some consulting services.

Financial industry

Many major

investment bank Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance, the purpose of investing i ...

s were historically structured as partnerships, and some such as Goldman Sachs maintain a class of "partners" at the top of their corporate hierarchy. In such firms, the "partners" are typically the highest-compensated

managing director A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...

s as well as more senior executives. The term is also used for senior executives in the

private equity In the field of finance, the term private equity (PE) refers to investment funds, usually limited partnerships (LP), which buy and restructure financially weak companies that produce goods and provide services. A private-equity fund is both a t ...

industry. In these industries, partners are often compensated millions of dollars per year.

References

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Law firms

Accounting firms

Financial industry

References

See also