Commercial awareness is generally one of the most feared aspects of an interview process. However, this tends to be more because applicants don’t really understand what is meant by commercial awareness, which can make it very difficult to prepare. This course aims to clarify what is meant by commercial awareness, how it can come up in interviews and how you can prepare.

What is “commercial awareness”?

To broadly summarise, if a person is “commercially aware”, this means they have at least a foundational understanding of how businesses operate, as well as a general awareness of the broader economic, political and commercial factors that can affect businesses. This could include an understanding of the types of strategies that businesses pursue (for example, an understanding of why and how businesses raise finance or engage in M&A activity) and the risks and threats that businesses face. It can also include knowledge of current affairs, industry trends, political events and the economy, as well as a foundational understanding of how these factors can affect firms and their clients.

Why is commercial awareness relevant to lawyers?

Commercial awareness helps lawyers to understand their clients, including those clients' businesses, their priorities, their competitors and their industries. It involves having the ability to consider not only the legal, commercial and financial issues that affect clients, but also the potential commercial impact of the economic climate, political environment, industry trends and other developments that affect clients’ industries more broadly. This can all help lawyers to provide informed, contextual advice that maximises clients' opportunities and minimises their exposure to risk. Lawyers are therefore generally expected to have at least a basic awareness and understanding of the most topical issues affecting their clients’ businesses and industries. 

Why is commercial awareness important for applicants?

Commercial awareness can provide you with essential context that enables you to better understand commercial case studies and business-related assessment centre questions. It can also help to prepare you for internships and ultimately, a training contract. For example, commercial awareness can help you to participate in informed discussions with interviewers and supervisors, better prepare for mock presentations and research reports, and better understand the context of the work you are set. Being “commercially aware” can therefore help to demonstrate your enthusiasm in relation to the firm’s clients and the work it carries out.

How can you demonstrate commercial awareness?

You may well have demonstrated commercial awareness even if you haven’t previously worked for a business. If asked to discuss a time when you have demonstrated commercial awareness, you could try to draw analogies between the fundamental processes that businesses follow, and some of the roles you have taken during your previous experiences. These processes might include branding, budgeting, pricing, marketing, customer service, effective management and a broad range of other considerations. 

For example, if you have arranged a university ball, then you will likely have been involved in: branding (deciding which theme to go with and how to reflect this theme in the decorations and entertainment); budgeting (ensuring that ticket sales will cover the costs of hiring a venue, catering, entertainment and decorations); pricing (you will likely have needed to set ticket prices); marketing (trying to persuade people to buy tickets); customer service (responding to questions from prospective attendees); effective management (making sure team members are fulfilling their roles on time); and a range of other commercial activities.

Note that our Training Contract Handbook provides much more extensive practical advice, insider tips, comprehensive insights and explanations of hundreds of key legal concepts and contractual clauses, including the terminology, jargon and acronyms that you’ll likely come across in practice.