Commercial awareness is regularly referred to as a necessary skill for a career in the legal profession yet, at the same time, those aspiring to become lawyers are often uncertain about exactly what it is. The key is to develop commerciality and be able to demonstrate it rather than worrying about the definition.
What is commercial awareness?
There is no single definition of commercial awareness. It encompasses understanding different businesses and the wider context in which they operate – who are the customers, competitors and suppliers of the business and what opportunities and challenges does it face in the marketplace in which it operates? You should also understand what commercial law firms do and how they interact with other city players.
Why is it important?
By developing commercial awareness you can tailor advice and solutions to your client’s business and predict the long term impact of any action taken. As a solicitor it is important to be familiar with your client’s business’ aims in order to provide advice that is both beneficial and cost effective. To achieve this it is also necessary to understand the market your client operates in.
How to show/develop commercial awareness
This is by no means an exhaustive list of how to develop and demonstrate commercial awareness, but it will hopefully provide you with a few ideas to get you started:
- Keep up to date with the news and think about the wider context when reading articles, for example: the opportunities and risks to the parties involved; whether it broke new ground; the long and short term implications; and what the role of the solicitor was.
- Develop an understanding of different types of businesses. This is not as difficult as it sounds. Part time jobs, albeit often not in a legal discipline, can provide an understanding of how that business operates. It’s even as simple as taking an interest in, and asking questions about, the businesses or sectors that your friends and family work in.
- Get a head start whilst studying at undergraduate level. As a trainee it is necessary to make the transition from learning and understanding the law to offering solutions and practical advice. It is not often that clients take an interest in cases and statute. Whilst studying, you might see things in the news to which you can apply the legal principles studied during your degree.
Remember… commercial awareness is a skill that you build up over time and even as a trainee and qualified solicitor you will need to continue to develop it.