2 December 2015.
By Will Foulkes.

Commercial awareness is a term you will come across with increasing frequency, is something that you will be expected to be very good at, and yet until you meet people in this world, it is difficult to get a clear explanation of just what it is.

Having commercial awareness means being able to demonstrate that you understand the commercial market as a background to any work that you do. In reality, there is no such thing as a commercial market place per se. All there is, is a web of entities joined together by economic relationships. These entities are banks and borrowers, traders and suppliers, distributors and buyers. Governments also play a role, but don’t worry too much about that for now.

So who are the big corporates and banks? What makes them tick? How have they been affected by recent global, political and economic issues? What is their position in the big picture, who are their suppliers and clients?

The key here is to be able to demonstrate to graduate recruitment that you have an idea of what is going on with that law firm’s clients. If you work at an international law firm, clients expect much more than just legal knowledge. That you have a good understanding of the legal issues is taken as a given, what clients really want is to know how they can best operate their business, or carry out a transaction in a legal and tax effective way. So in order to best advise them you need to know what motivates them now, how they run a successful business and their goals for the future.

So what is a good strategy to help you get this understanding? Subscribe to the Financial Times (“FT”) and to the Economist as soon as possible. I prefer the Economist as it is generally written in an interesting and accessible style without too much industry-specific terminology. The FT cannot be beaten though on its up-to-the-minute reporting and once you have got to grips with the terminology it is invaluable. So both should be used together.


• Financial Times
• The Economist
• Lawyer 2B
• Chambers Student
• LegalWeek


Be warned, for most people the best initial intent is often easily thwarted. A common experience is that someone goes and buys the FT on a Saturday morning full of a will to succeed, sits down to read it and then finds that they don’t really understand what any of it is about. This naturally leads to frustration, boredom and distraction and then setting the paper aside with a mental note to return to it later. This is because when you start reading you will come across a lot of unfamiliar terms that are bandied about freely, that can make an article impenetrable.

Understanding the commercial and financial world is quite like learning a new language. When you start you will likely find references to concepts that you are not familiar with and abbreviations that are completely alien (e.g. CDOs – Collateralised Debt Obligations or CDSs – Credit Default Swaps) along with a host of jargon like ‘poison pill’ and ‘white knight’ and the like.

Initially, you will not be able to pick it up and skim read it and absorb all the important details of the latest deals before (or during) your morning jog.


This is where the graft comes in. You need a highlighter and a notebook. Pick an article that is big news and read it thoroughly. Set yourself 15 minutes to read it. Pore over it and highlight any words you don’t completely know the meaning of. Shares, bonds, securities, receivables, securitisations, collateralised debt obligations, FTSE etc. Do you really know what a share is? Could you write me a definition or explain it to me in an interview? What is LIBOR? Do you know the difference between a share and a bond? What is a management buyout? Or a takeover as opposed to an acquisition?

Anything that you don’t know, look it up. Google is a fantastic starting place, as there are all manner of financial dictionaries out there that will explain it to you such as Then write down in your own words what you think it means in your notebook. Using your own words is a vital mental process to comprehension, and later, for recall. Make a note of what it is you don’t understand and later look up and jot down the definition.

Build up a reference notebook of terms and their definitions. Often a small word or abbreviation can actually refer to a very complex concept that requires a lot of thinking about, multiple explanations and diagrammatic representation. It is important that you invest the time understanding these. Consider investing in a financial dictionary. After a while you will start to see more and more terms that you are familiar with and the articles will become much more accessible.

If you buy one FT and study one article an evening for a week, which needn’t take more than 15-30 minutes a day, you will soon notice a drastic improvement in your comprehension. Think of it as learning a new language, except that you already have the grammatical structure and joining words. What you lack is vocabulary. So start making your list and get learning. Make this a task for this weekend: get a notebook, highlighter and a copy of the FT.

The better you get the less time you will need to take ‘studying’ an article and the more time you can spend just reading it. Then you can start grouping articles around a similar subject. Start a ring-bound file. Cut out articles that relate to similar subject matter and keep them together in a plastic insert in the file. You will start to build up an in-depth understanding of the issue or deal at hand and its impact on the wider market.

When you come to writing your application form and the question that asks you to discuss a recent commercial event or issue that has interested you, you will have a whole file of research on different issues to draw upon. Then it is just a case of summarising the parts that you found interesting into 200 words or thereabouts for your application form, which you can then easily expand upon at interview.

The other great source of market information is the Economist. As it is published weekly it has already summarised the key issues and selected the best bits, so it is saving you some of the leg-work. Finally, there is City A.M. for up to the minute reporting on what is happening major players in the City of London.

If folders are not your thing, another way of doing it, if you are more visually orientated, is to buy some blue tack and go to town on your wall. I did this, cutting out articles from the Economist, highlighting the interesting bits and sticking it on my wall above my desk (careful not to go too overboard though lest your friends try to have you sectioned). That visibility of the articles meant that in idle moments when I was studying, my eyes would wander over the text on the wall. So the information was absorbed more by osmosis than by applied study. It was also a nice break from studying (although not quite as nice as watching TV or say, a lot of other things).

So study the FT, make a note of any terminology you wouldn’t feel happy explaining in an interview and learn it. Your goal is to become comfortable enough with what they are talking about that you don’t need to study the articles any more, you can just pick up a copy of the FT and read. Build your folder, or cover your wall in articles, whatever works for you.