‘Commercial Awareness’ - What it is and How to Attain It
'Commercial awareness’. It’s a term that prospective lawyers are going to hear a lot. In fact, it's also one of the most daunting areas of getting a job in law and often makes aspiring lawyers’ stomachs churn. That said, it’s incredibly important for all students to be aware of what exactly it means - if you look at law firm recruitment websites, nearly every one of them will state that they are looking for a candidate that is commercially aware and willing to further develop their commercial acumen. This article is going to help you to define commercial awareness and understand how you can attain it in order to achieve that coveted training contract or pupillage.
What is commercial awareness?
Firstly, defining commercial awareness is harder than one would originally think. Dr. Dan Awrey, associate professor of Law and Finance at the University of Oxford, has a very interesting take on the term ‘commercial awareness’. He states ‘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 instrument that clients want to leverage to navigate the legal system in pursuit of their own objectives’. He then argues that ‘commercial awareness can then be understood as a function of the lawyer’s ability to translate their legal expertise into better outcomes for clients’.
So, apart from a lawyer translating legal expertise into a better outcome for a client, commercial awareness can be understood as staying up-to-date with current affairs and developments in the business and commercial world. This includes staying up to date with the economic, political and social aspects of the world, as they all have an impact on the commercial industries and potential legal clients - just take a look at the recent shock dealt to economic markets as a result of Brexit and Trump. However, avoid simply learning about the major new stories, try to look for more obscure ones, such as the recent call in India to boycott Chinese goods. In general, law firms advise that students research news stories that they have a genuine interest in, as opposed to those that everyone is discussing (although, be cautious with this, as not having any knowledge of huge news stories will discredit your commercial awareness).
How to achieve commercial awareness?
Now that we have defined what commercial awareness is, how do you attain it or present that you have it? In fact, gaining commercial awareness is easier than you would think. Most people (I was definitely one of them) overthink the situation and then can easily get confused. The first thing that you should do is start keeping up to date with what is going on in the legal and commercial sectors. You can do this by reading any newspaper of your choice, including their business sections. The Telegraph, the BBC and the Guardian offer easy to understand business information available online, and an especially good business newspaper to start building your knowledge with is City AM, published every morning and available to download. After this, you can move on to the Financial Times – but don’t worry if you can’t yet understand every phrase!
If you don’t want to read a newspaper every day, you could always follow The Economist on Twitter or Facebook, as they have some brilliant articles that link in with business, political, economic and legal issues of the day. Furthermore, The Spectator often offers interesting opinion pieces on current issues that will allow you a greater understanding of the topic.
If you are a fan of reading books, many law students praise Chris Stoakes’ ‘Know the City’ and ‘All you need to know about Commercial Awareness’ as their Bibles. In addition, you could sign up for our newsletter, as we send weekly commercial awareness updates straight to your inbox.
If you want to be more specific in what's going on in the legal sector, you could always read the Law Gazette and the relevant legal blogs and newspapers on the internet. Alternatively, if you enjoy watching news instead of reading it, you could watch BBC’s 15 minute long World Business Report on iPlayer, released every morning and accessible to all levels of commercial understanding.
You can also pick up commercial awareness while completing your work experience by finding out how a firm or business works and how they deal with their clients’ businesses and issues. So whether you are reading the newspaper, watching shows, or working, constantly ask your self questions (and try and find the answers to them) such as ‘why did this happen?’, ‘what does this mean?’, ‘who benefits and doesn't benefit from this?’, or ‘what are the consequences of this decision?’. These are just a few examples to give you the idea of what you should be looking for. By surrounding yourself with the relevant information and asking yourself the right questions to apply this knowledge, you will quickly gain the coveted commercial awareness required.
How to present commercial awareness
As with defining and gaining commercial awareness, showing that you posess the necessary commercial acumen won't be a walk in the park. 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?”.
Furthermore, to show that you have impressive commercial awareness, you should research the practice areas for the firms that you are applying to. For example, if a firm specializes in energy, construction, and transportation, it would be useful to research the relevant fields and build up a knowledge in that area. For example, ask yourself how sustainable materials and renewable energy will affect these sectors and what impact that will have on the firm?
There are plenty of other articles on this subject, and I would suggest that you read as many as you can (I have included some links to said articles at the bottom of this page). Good luck getting started on improving your commercial awareness and don’t hesitate to comment below with further questions!