General counsel mix art and science

Once purely legal, their role now encompasses strategic and creative responsibilities
Tokyo Metropolitan government yard, across from Shinjuku Chuo Park © Toshiki Senoue

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In his 1970 book Design Methods, John Chris Jones wrote that design incorporated elements of art, science and mathematics, but while these disciplines concerned present reality, design was different because its subject was something that had to be foreseen and imagined.

In highly regulated and complex markets, general counsel must show a similar mix of abilities: they have to be masters of process, data and risk matrices while honing their judgment and forecasting skills.

In fact, “design thinking” is now playing a role in the work of general counsel by showing them that attention to process and creative thinking are not mutually exclusive. The legal team at Australian telecommunications company Telstra has adopted a range of project management techniques and design thinking, taught to them by academics from Harvard University. Telstra’s group general counsel, Carmel Mulhern, summarises it as “using a different methodology to solve problems and get to solutions quickly”.

Many of the tenets of design thinking — embracing risk and ambiguity, tolerating failure, moving quickly and taking leaps of faith — sit uncomfortably with traditional lawyers. But Telstra’s lawyers have started to think like designers through several initiatives.

Telstra’s “Licensed to Thrill” programme allows lawyers to take an innovative idea for an improvement in any business unit and implement it. Lawyers are given two to four weeks to work with the business team to make the changes envisaged.

The team also runs “sprints”, a concept popularised by GV, the venture capital investment arm of Google, to develop and test new products and solutions in short periods of time.

While the new solutions are improving efficiency, Ms Mulhern says “the biggest impact has been the empowerment of our lawyers to own their environment and make changes happen. It has allowed for an incredible harnessing of the energy of our lawyers.”

General counsel need such stimuli as their role grows in breadth and importance, becoming far more than just providers of legal advice. As risk managers, decision makers and business leaders, they now rely on processes and technology as much as interpersonal skills and finely tuned judgment based on experience.

Michelle Hung joined Cosco Pacific, the Hong Kong subsidiary of the eponymous Chinese shipping company, as general counsel 20 years ago. Her position has evolved as the company has grown to an $800m revenue business. Initially, Ms Hung was primarily a legal adviser, focused on managing compliance and legal risk across the business’s divisions.

Now she does not just give opinions, but also makes business decisions. She has had to grow, she says, “not just on the technical side, but also in how I deal with management and other departments, and with outside lawyers.” She says “a certain charisma” is necessary for co-operation too.

At Bank of China (Hong Kong), general counsel Carmen Kan’s role has expanded since she joined in 2010. In October 2015, the bank restructured its internal functions to combine legal, compliance and operational risk management into one department, led by Ms Kan. She says that the greater oversight helps her to manage risk better.

“Now that I look after these functions, I see the interconnectivity,” she says. “If you have a businessperson telling you about an operational incident, without knowing the law, the regulatory concerns, the codes and the guidelines, you can’t advise effectively.” However, Ms Kan points out that her effectiveness ultimately depends on the trust she engenders from the corporate officials around and above her.

The growing complexity of regulation in financial services makes it no accident that seven of the top 10 legal teams in this year’s Asia-Pacific in-house rankings are at financial institutions. Managing and shaping regulatory change is a top priority for general counsel such as Amanda Harkness at the Australian Stock Exchange (ASX). “I see myself as a strategic adviser on how regulation drives our business economics and how we can proactively shape that to future-proof our business,” says Ms Harkness, who leads government relations and corporate affairs, in addition to legal and regulatory responsibilities.

Communication is a large part of her job and Ms Harkness encourages her team to “make the complex simple”. She says this allows them to be creative, courageous and collaborative, and — just as importantly — to have fun. Lawyers get to be mini-film producers, making 45-second videos in order to brief colleagues on legal or business topics.

The ASX in-house lawyers have also much in common with their colleagues who work in technology. Speaking to the business’s coders recently, Ms Harkness joked that “lawyers are just coders with better marketing”, adding: “We’re doing the same thing, breaking problems down into basic principles and following logical arguments.”

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