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6 Financial and business films to help your commercial awareness

Everyone knows that applying to law firms can be a challenging, time-consuming process. For many students, it can often feel that there are not enough hours in the day to accomplish everything. Additionally, staying on top of your commercial awareness, whilst prioritising assignments, can be a daunting prospect.

Nonetheless, it is essential to ensure that you are taking sufficient time out each week to avoid burnout. Furthermore, through your dedicated moments of relaxation, you can absorb a surprising amount of background knowledge to current affairs. This basic understanding could prove useful for future interviews.

Therefore, please feel free to watch a movie to relax from time-to-time. Furthermore, avoid lamenting the fact that you are not spending the entire evening studying the FT cover-to-cover. Honestly, there are other ways to enhance your financial, business, and legal acumen. Indeed, I would argue that viewing the following films could even be justified as commercial awareness research!

The Big Short

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Based on the excellent book by Michael Lewis, The Big Short is arguably the most celebrated of modern finance themed films.

For those who have not watched the movie yet, The Big Short is a fascinating story focusing upon several hedge fund managers who made lucrative returns by anticipating the downfall of the US housing market. In particular, The Big Short’s tale develops as the characters collectively learn about the financial institutions and financial instruments that were closely-connected with such toxic sub-prime assets.

The film elegantly explains the complex financial instruments culpable for the last recession in easy-to-understand analogies. As such, by the conclusion, you will better appreciate the role of hedge funds, credit rating agencies and investment banks within financial markets. Moreover, viewers will be able to discuss complicated areas like bonds, sub-prime mortgages, securitisation, shorting, mortgage-backed-securities, collateralised debt obligations and synthetic CDOs with great aplomb.

Likewise, you will see an intriguing depiction of the legal fallout of an investment fund being ‘gated’ by its manager (where the fund restricts investors from withdrawing their money). In short, (bad pun intended!), this film is a financial jargon-buster starring Hollywood’s biggest names!

Additionally, if you have already watched Adam McKay’s masterpiece, I would strongly encourage you to watch it again. My reason for the repetition is, having viewed The Big Short when it first came out and subsequently more recently (with a more informed commercial understanding), it is incredible how many nuances I missed initially.

Significantly, in terms of law firm applications, the film is constructive too. US law firms have many investment fund clients. Also, lawyers are responsible for drafting the contracts on a wide range of bespoke financial products. Elsewhere, financial regulation provides considerable legal advisory work. Similarly, solicitors’ regularly litigate financial crime and undertake insolvency work, real estate transactions and negotiate dispute resolution.

As an aside, Michael Lewis has written several financial themed books that are exceptional reads. In particular, I highly-recommend Liar’s Poker for candidates. Lewis’s engaging personal account of life at Solomon Brothers will clarify any confusion you have surrounding bonds and debt finance – an area that is challenging to conceptually master.

Barbarians at the Gate

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Barbarians at the Gate is a genius film, combining 1980s excess with sharp wit, parody, fantastic characters, brilliant acting and a gripping storyline.

Furthermore, Barbarians at the Gate should be watched by all applicants ahead of any assessment centre. My reason for this suggestion is that the central plot of the film involves a leveraged buyout of a multinational company. The private equity purchaser KKR wishes to use a high amount of debt or leverage to finance the transaction. Likewise, the buyer wants to undertake changes to the company’s corporate governance post-takeover. Realistically, the Barbarians plot could easily be a case study that interviewees are asked to unpack.

The fascinating aspect concerning Barbarians at the Gate is that it is a true story – at least as true as Hollywood is prepared to tolerate. The plot relates to one of the most infamous takeovers of the 20th century – the acquisition of RJR Nabisco (a tobacco/ food conglomerate) by KKR (a major private equity firm).

Indeed, you can learn a lot about clients’ priorities during transactions by observing how CEO F. Ross Johnson of RJR Nabisco, and Henry Kravis of KKR, interact throughout the film. Equally, the impact of legislation changes, marketing initiatives, product launches, executive compensation, competitive rival bids and news leaks on deal valuations are all addressed throughout the film.

In terms of applications, M&A is big-business for corporate law firms. Furthermore, in the past decade, private equity buyers have increasingly become central players in the financial system as companies delay IPOs and stay in private ownership for longer. Therefore, this film can assist candidates in understanding the subtleties of these particular PE clients’ objectives and business strategies.

The China Hustle

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Released early in the US-China Trade War, The China Hustle is a documentary that concentrates on the emergence of Chinese companies that are listed on the US stock market. The documentary raises questions about the accuracy of the impressive growth recorded by some of these corporations. Furthermore, criticism is presented regarding the levels of oversight provided by regulators.

This documentary is an enjoyable watch, and it outlines many of the apprehensions that investors have when allocating their money into emerging market companies. Also, the film traces the difficulties in proving fraudulent activity. Further, The China Hustle touches upon the impact of market confidence on a company’s share price. However, perhaps this movie is most useful for illustrating the due diligence that investors may perform to value investments.

For example, at one point, our investor protagonist has employees counting truck movement outside of a Chinese factory. The goal? – To estimate the company’s potential sales volume. The estimation is then compared against the company’s forecasted figure in their accounts. The manager’s attempt to obtain ‘private information’ (information not accessible to the wider ‘public’ market) that can deliver exceptional investment returns is a selling point of funds to their clients. So, it is exciting to view such intelligence gathering activity in practice.

In terms of applications, no firm will expect you to count vehicle departures outside a factory during your vacation scheme. However, trainees will regularly scrutinise documents during the due diligence stage of an M&A transaction. The aim of due diligence’s is to ensure that there are no hidden ‘red flags’ adversely affecting the company’s valuation. Fortunately, The China Hustle identifies a collection of warnings that you now know to look out for!

The Crooked E – The Unshredded Truth About Enron

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I will not misguide you, I suspect that The Crooked E was a made for TV movie! Nonetheless, this film about the downfall of Enron gives a fascinating glimpse into the scandal that rocked the early 2000s financial markets.

The film documents the rise and fall of the energy giant through the eyes of a fictional employee Cruver. For main themes to note, The Crooked E illustrates the impact of employee incentives on company performance and the corporate culture. Furthermore, the director tackles the customised auditing practices that eventually caused millions to lose their savings and the major accountancy firm Arthur Anderson to go bust. Sidenote, want to know why we now have a ‘Big Four’ rather than a ‘Big Five’? Then, this film is worth a watch.

Elsewhere, The Crooked E provides an insight into the advancement of modern ESG investing (investing with environmental, social and governance goals in mind). Post-Enron’s collapse, financiers are now more concerned about companies’ internal corporate governance, stakeholder management and executive compensation. Enron, with its relentless salespeople, dubious financial reporting and misleading leadership statements, arguably may not have received analysts’ wholehearted approval in modern times.

In terms of applications, The Crooked E is beneficial for indicating the responsibilities of other professional services. After all, solicitors and clients will frequently rely on the reports/advice of accountants and consultants when performing transactional work. Furthermore, the turning economic cycle has made debt restructuring and insolvency growing practice areas. Therefore, commercially astute viewers should contemplate all the individuals that were impacted by Enron’s insolvency and any claims that they may possess?

Rogue Trader

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Hollywood loves a white-collar crime film. The suspense, the cover-up, the greed and the charismatic lead – admittedly, we audiences lap the drama up too.

Starring Ewan McGregor, Rogue Trader depicts the real-life fraud of Nick Leeson. Nick Leeson’s 1990s fraud was so extensive that it brought down Barings Bank – a financial institution that had stood for centuries.
For context, Nick Leeson was a back-office employee at Barings who eventually led the bank’s futures trading team out in Singapore. And, his crime still gives Compliance Officers nightmares!

Put simply, as Leeson was familiar with the back-office functions of the institution, he could successfully hide his trading losses. Furthermore, Leeson could successfully navigate the bank’s compliance restrictions. Unfortunately, Leeson was praised as an exceptional trader, when in reality he was losing the bank hundreds of millions of pounds.

By watching this film, candidates should learn far more about derivatives trading, especially future and options contracts. In addition, the film provides a peephole into the functions of the front office and back office roles within a bank. Also, the movie presents a revealing vision of the prevalent attitudes towards emerging market investment risk and opportunity at the end of the last century.

In terms of applications, watching Rogue Trader has two main advantages. The damage caused by rogue traders to global banks is still ever-present. Indeed, many high-profile cases have kept city firms’ white-collar defence and prosecution teams busy in recent years. Accordingly, this infamous fraud case is a notable example to recognise.

Moreover, lawyers conducting work should always ask ‘who is my client?’ For most applicants, a prompt answer to this question may be the bank or financial institution. Perhaps, a more sophisticated approach may be to consider who strictly within the bank is demanding the instruction and what is their legal goal?

Margin Call

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Finally, we have Margin Call. Set in a fictional investment bank, Margin Call is one of many finance films that followed the Great Financial Crisis. The viewers witness the investment bank trying its best to survive by unloading its toxic assets to customers in a fire sale.

Generally, the film excels at portraying the internal office politics that can impact decision making in high-pressure moments. For instance, redundancies at the bank have a personal element and employees that have experienced previous recessions are self-described as ‘survivors’.

Margin Call also provides insight regarding the reliance that leading banks can have on financial modelling for informing their strategy. Furthermore, the role of erudite quantitative analysts in making forecasts and calculating risk potential is well-demonstrated.

Elsewhere, the themes of leverage and buying-on-margin are great for candidates to review for their commercial awareness.

For reference, margin buying is a common way for traders to acquire assets. Effectively, investors are buying financial products with mostly borrowed money. To protect the lender, the lender demands that the investor must maintain a certain margin ratio at all times. If the share/derivative falls in price, the investor may be below the required margin ratio. At this point, the investor will be politely requested to provide more funds urgently.

Therefore, high leverage (or high debt to equity ratios) enhances the return possible for an equity investor but expands the investor’s risk dramatically. Consequently, when asset prices suddenly fall (as they did in March 2020), financial markets begin to panic. The panic arises, as to guarantee a sufficient margin, investors are suddenly asked by their brokers to provide more cash. Failure to do so, risks the asset being sold at a significant loss. To compound the problem, investors rarely have the necessary money ready to hand. Margin Call portrays the panic well.

Inevitably, institutions increasingly hold onto their cash stockpiles to post sufficient margin. Furthermore, they sell assets quickly to generate needed cash. Hence, markets tend to become more illiquid, and prices fall as money is hoarded rather than used to buy/lend assets. Margin quickly becomes an issue.

In terms of applications, it is useful to understand how dilemmas that initially seem niche financial issues can quickly impact broader stakeholders. Crucially too, law firms often advise on transactions using high amounts of debt. For example, a client may require a leveraged loan as part of debt restructuring. Alternatively, the transactional client might be embracing a leveraged buy out.


Unfortunately, binge-watching movies will not get you a training contract. However, films can be used to inform your commercial awareness. In fact, the plot of many productions often centres upon iconic legal cases or controversial transactions.

Quite often, these entertaining stories are matters that your partner interviewers may recall from earlier in their career, and they may even remember them fondly. Consequently, an adroit discussion of these famous examples, alongside an awareness of contemporary news stories, will demonstrate a strong candidate with a genuine interest in the work.

Applications to Shearman & Sterling’s Vacation Schemes are open. Please feel free to post comments of films that have assisted your understanding of commercial themes below, and that may be useful to fellow candidates to watch.

by Matthew Dow

*An original reduced version of this blog from 2019 can be found at LawCareers.Net.

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