Introduction

Commercial awareness is indispensable for those working or looking to work in city professions, including commercial law, banking and finance, and professional services.

Having commercial awareness can set you apart and make you invaluable to your employer and clients.

But what is commercial awareness and why is it so important?

What is commercial awareness?

Having commercial awareness means having a thorough understanding of the commercial / business world and being able to critically analyse events and apply your knowledge to real-life situations.

This includes:

• Understanding key commercial topics, and how businesses work generally and in sectors of interest. For example - understanding what businesses do, what products / services they sell, their customers, competitors, and the challenges they faces;
• Understanding what is happening in the commercial world - including political, economic, sociological, technological, legal and environmental events;
• Being able to analyse the impact of events or circumstances on the economy, sectors of interest, and specific businesses; and
• Being able to creatively problem solve, consider how businesses can navigate through such impacts, and tailor services for clients with this in mind.

Why is commercial awareness important?

Firstly, employers themselves are businesses.

Having commercial awareness will make you more valuable because you will be able to help resolve issues impacting the business, creatively consider ways to generate revenue, and because such skills are also valuable to the clients you serve.

Secondly, many city professions will involve you working with business clients. Whether you’re a corporate lawyer helping clients to rationalise a corporate structure, or an accountant conducting financial due diligence on a potential acquisition target for a private equity firm, or a corporate financier helping a company raise money, you will be working with businesses on a daily basis.

The aim of a business is generally to generate revenue and make a profit. Businesses hire city firms to help them with this in some way, or to help resolve problems which are an impediment or risk to this. Accordingly, services must be tailored to the client’s business, consider the commercial implications for the client, and help clients achieve their aims; this requires commercial awareness.

Hopefully that’s enough to convince you that commercial awareness is a good skill to have. If you’re still in doubt, have a look at the careers websites of the firms you want to work for; I can almost guarantee they mention commercial awareness as a key skill for prospective employees.

How to develop commercial awareness

Commercial awareness is a skill, a mindset, and a continuous learning process.

There are various ways to develop commercial awareness:

• Getting real-world work experience - to get such work experience within the city, you often need a base level of commercial awareness to get through the recruitment process (which is where this website comes in);
• Engage - discuss commercial matters with your peers, attend seminars, and participate in events to broaden your understanding;
• Stay informed - critically read business news and consider how events impact the economy, specific sectors, and individual businesses. When I was a student, I found a lot of business publications impenetrable. What I needed was a base level of knowledge to help me understand these materials, which leads us on to our final point;
• Embrace interdisciplinary learning - read up on topics such as economics, politics, and how the city and businesses work. The content on this website is designed to assist you with developing knowledge that will allow you to critically analyse commercial events.