‘Future-ready’ in-house legal teams hone strategy roles
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Many of the in-house professionals highlighted in this FT Innovative Lawyers Asia-Pacific report have made important commercial, as well as legal, contributions to their companies’ success. That is a reflection of how they are being increasingly valued as business advisers.
The legal team at Qantas, the Australian airline, stood out for several efforts over the past two years to keep the airline operational and solvent through the pandemic. They raised new funds, negotiated agreements with suppliers, and helped the airline to shift quickly to running repatriation flights for Australian citizens and freight services during the country’s pandemic lockdown.
“There’s a significant expectation now that the general counsel and legal team provide not only legal expertise but commercial and strategic advice and input,” says Ben Jones, head of legal at Qantas.
Other developments — such as the rise of legal operations as a discipline, and the growing importance of environmental, social and governance (ESG) matters for businesses — are also creating more varied and interesting careers for in-house lawyers.
In fact, the opportunity to build expertise in ESG, in particular, appears to be highly motivating for lawyers looking for new challenges and a sense of purpose in their jobs. Similarly, the ongoing digital transformation of individual businesses and wider industries means legal teams are investing in data and technology skills.
Most innovative in-house legal teams: Asia-Pacific 2022
Winner*: McKinsey & Company
Accenture
BHP
CIMB Group
DBS Bank
PayPal Australia
Westpac
*Winner of the FT Innovative Lawyers 2022 award for ‘Most innovative in-house legal team in Asia-Pacific’; other organisations are listed alphabetically
At DBS Bank, the legal and compliance team is being trained in sustainable business practices and in “Web3” principles — that is, to equip lawyers as the internet evolves based on the development of blockchain, cryptocurrencies, and the virtual world of the metaverse.
Gaining this knowledge will ensure they are “future-ready”, explains head of legal Chee Kin Lam. “This is about scanning the horizon. We are already trained for the law of today.”
The focus on employee development and engagement is particularly acute in Asia-Pacific due to the fast pace of growth in many of its markets.
Rita Kriz, head of legal for Asia at the consultancy McKinsey & Co, which has won an FT Innovative Lawyers award (see table, above), says the growth of the business in the region has created new opportunities for the legal team. “Because Asia is such a diverse region with different languages, laws, and cultures, we are constantly upskilling our legal team to stay abreast of business developments,” says Kriz.
The lawyers were recognised for creating a model to cover the complex and diverse requirements of McKinsey’s businesses in 16 countries across Asia. To help them manage legal requests from these businesses, the Asia legal team was reorganised to create single points of contact for each team of frontline consultants.
These lawyers develop deep relationships with specific business lines and clients. In addition, the lawyers have expertise in a particular practice area, such as data privacy or technology. The model allows them to work more closely with their business colleagues, while continuing to build technical knowhow.
The approach borrows from the agile organisational models McKinsey’s own consultants have developed and refined for the firm’s clients. “We engage with our consultants, learn from their approach and adapt what is optimal for ourselves,” says Kriz.
The market for top legal talent has been as tight in Asia as it has in Europe and the US over the past year. Legal teams traditionally recruit lawyers after they have worked for three to five years in a law firm — when they might consider a move in-house — but, as the firms increase their pay, this is becoming a challenge.
While competitive pay matters, one important draw of an in-house legal career is the chance to do challenging work and feel connected to the success and mission of a business. “We launch many innovative businesses and services in Japan — a big attraction for legal professionals is that they will be involved in these interesting projects from the outset,” explains Angela Krantz, legal director for Amazon Japan.
At Binance, the world’s largest cryptocurrency exchange, when general counsel Hon Ng joined, in November 2020, he was only its eighth lawyer. But, in just over a year, he has built the team to more than 50. He was able to attract lawyers to join the team partly by promising exciting work — such as engaging with regulators on establishing frameworks to govern cryptocurrencies and other digital assets.
More from this report
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Why foreign private equity is eyeing deals in Japan
US-China rift becomes a legal feud
Australia’s bank probe spurs digital mission
China’s homecomers bring flow of deals
Blockchain comes on board to smooth global supply chains
Ukraine conflict threatens Japan’s clean energy transition
At the most senior levels, general counsel roles can present a whole new challenge, too.
Christopher Betts joined the Singapore-based super app Grab as general counsel last year after nearly two decades in private practice, most recently as a partner in US law firm Skadden, Arps, Slate, Meagher & Flom’s Hong Kong office.
The technology company offers delivery, ride-hailing and financial services and closed a record $40bn merger deal with a special purpose acquisition company last December.
Betts could see the appeal: “The initial push factor was waking up one day and realising that chugging away at a big corporate law firm didn’t feel like the best use of my skills.”
Case studies:
Business leadership
ESG leadership
Operations
Talent management
Business leadership
Case studies in best practice. Researched and compiled by RSGI. ‘Winner’ indicates the organisation won an FT Innovative Lawyers 2022 award; other organisations are listed alphabetically
In-house lawyers have an important leadership role when strategic change is under way.
WINNER: Qantas
Few businesses were affected as dramatically as Australian airline Qantas when the Covid pandemic hit. With Australia’s federal government shutting down international travel and states restricting domestic travel, the airline lost two-thirds of its revenue.
The legal team led negotiations with close to 10,000 suppliers to pause supply and stave off bankruptcy for the airline. In most cases, it meant negotiating commercial rather than purely legal principles to reach an agreement.
The legal team helped to raise new funds in the form of both debt and equity, convincing lenders and investors of the value of the underlying business and its brands.
While moves to stand down and make staff redundant have been controversial, the airline has not only survived, but emerged in a strong position.
ANZ
A team of lawyers at the Australian bank delivered a project to transition from Libor to other benchmark interest rates. As well as advising on legal questions, lawyers helped to lead a cross-functional team of experts from different departments, developing new commercial processes and making changes understandable for a range of stakeholders, including technical staff and the bank’s customers. Several of the bank’s recommendations and templates have been accepted as new market standards.
Binance
A fast-growing legal team at the world’s largest platform for cryptocurrency trades is implementing new standards to help the company and industry develop. While Binance is not licensed by financial regulators in most countries, it is actively engaging with governments and regulators across the world as they consider new rules.
The legal team at Binance contributed to the government of Dubai’s regulatory framework for crypto assets introduced at the end of 2021. The team has implemented new internal standards to improve identification of Binance’s users and helped create a self-insurance fund for customers who fall victim to hacking.
Grab
The in-house legal team led Singapore-based Grab’s $40bn “de-Spac” deal with Altimeter Growth Corp, to gain a listing on Nasdaq. These deals involve merging with a listed special purpose acquisition company and Grab’s was one of the largest of its kind globally and the biggest US equity offering by a south-east Asian company. As such, it drew a high degree of scrutiny from US regulators.
The team also led on the buyout of a joint venture interest in Indonesian epayment service Ovo and the acquisition of grocery chain Jaya Stores, contributing to the expansion and diversification of Grab as a super-app company.
Lazada
Lawyers at the Singapore-headquartered ecommerce company worked on an electronic world trade platform project, led by parent company Alibaba, to help create the Eastern Economic Corridor — a special economic zone, in Thailand.
Lawyers negotiated special land acquisition rights with the Thai government and created a model for a special customs zone. The zone allows businesses to fulfil orders quickly for customers around the region without customs delays.
ESG leadership
Case studies in best practice. Researched and compiled by RSGI. ‘Winner’ indicates the organisation won an FT Innovative Lawyers 2022 award; other organisations are listed alphabetically
As companies transition towards lower-carbon operations, their lawyers are designing new co-operation and supply agreements, as well as products and services to support sustainable business practices.
WINNER: DBS Bank
The legal and compliance team at Singapore’s DBS worked with partners at the Singapore exchange, Standard Chartered bank and state-backed investment company Temasek to navigate competition issues as they jointly established the Climate Impact X platform: a global exchange to trade carbon credits. While the platform, which launched in March 2021, provides only a near-term solution for companies to meet carbon reduction targets, it aims to incentivise investments in longer-term projects. DBS Bank’s legal team played a leading role advising on regulatory issues, and on creating a governance framework to mitigate the risk of carbon credits being misused for greenwashing.
Accenture Japan
As part of a project to help a sushi restaurant chain reduce food waste, the legal team worked with Accenture’s artificial intelligence (AI) data scientists to develop a value-based fee arrangement for the work. The team implemented an AI and data solution that helps the restaurants more accurately predict how much fresh fish they will need each day. Accenture is paid a fee based on how much food waste is reduced.
BHP
A series of new partnerships with important customers and suppliers is helping the mining company improve sustainability up and down the supply chain. Lawyers developed an agreement with Tesla to use blockchain technology to track the provenance of nickel used in the electric carmaker’s batteries, ensuring it is sourced from more responsible and energy-efficient mines. They also created a new model for shipping companies to use liquefied natural gas in order to reduce emissions when shipping BHP’s iron ore from Australia to China.
BlackRock
Lawyers worked with Hong Kong regulators to allow asset manager BlackRock to launch the first regulated environmental, social and governance (ESG) fund of funds in Hong Kong. While the fund is registered in Luxembourg, it is sold to the public in Hong Kong, where the market for ESG investment is at an earlier stage of development. Lawyers navigated a number of complexities to gain approvals for this unfamiliar structure, including showing how the ESG rating of the underlying funds applied to the fund of funds.
CIMB Group
To create a digital small loan product in partnership with Touch ’n Go — an electronic wallet provider — lawyers at the Malaysian bank helped develop ethical and compliant models that allow personal data to be shared between the e-wallet and the bank. Lawyers were involved from the early stages of development and contributed to new processes that will enable the bank to develop and launch digital products more quickly.
Operations
Case studies in best practice. Researched and compiled by RSGI. ‘Winner’ indicates the organisation won an FT Innovative Lawyers 2022 award; other organisations are listed alphabetically
Innovations are improving the quality and speed at which lawyers undertake day-to-day services. This category recognises outstanding initiatives already implemented, and also commends “ones to watch”.
WINNER: DXC Technology
An online risk assessment tool was developed by the Asia-Pacific legal team of the US-based international IT services and consulting company. It streamlines the approval process for risks and exceptions in customer contracts, increases contracting speed, and collects records to track precedents and provide insight into how risk decisions are made. The tool provides a big picture view of the company’s contractual risks and makes negotiating new contracts and renewals more seamless. Since its launch in the Asia-Pacific, the tool has been rolled out globally.
BHP
A dedicated legal operations and transformation team at the Australian miner is making a series of incremental improvements to the way the legal team operates. The team has introduced a central hub to share resources on improving processes and effecting change in the organisation, and new tools to automate and speed up reporting, contracting and accessing legal advice.
CIMB Group
The legal team at the Malaysian bank created technology that uses machine learning and robotic process automation to assess millions of alerts for transactions that could fall foul of anti-money-laundering rules. The tool can manage the majority of non-complex alerts without needing human input and is collecting valuable data to track patterns in risky transactions.
DBS Bank
The legal and compliance team at Singapore’s DBS, south-east Asia’s biggest lender, implemented what it calls a platform strategy, to manage data and technology initiatives across the department. It ensures the processes and resources to develop, launch and support new technologies are co-ordinated. An important component is training people in new tech and operations skills, and creating career paths for non-legal professionals in the team.
McKinsey & Company
To support a sudden increase in work after taking on a number of new projects, the Asia-Pacific legal team at the consultancy introduced a new process to centralise and manage legal requests from the business, and a tool to create contracts automatically. A communications programme helped business colleagues to rethink how they engage with the legal team and to encourage use of self-service tools.
Tata Communications
A dedicated legal operations team at the Indian telecoms company has implemented automation tools, legal intake and analytics apps, an internal team to manage high-volume legal processes, and a revamp of its contracting process. The focus on a wide range of small initiatives allowed the team to deliver results quickly.
PayPal Australia
The Australian legal team at PayPal developed a tracking tool to scan laws and regulations in the 250 markets where the online payments company operates, to ensure the business’s policies comply. The tool is being rolled out globally and provides a comparison of regulation across jurisdictions, and notifies the team when relevant changes occur.
Westpac
The Australian bank’s new Legal Advice Protocol comprises a series of interactive engagement guides that help to provide a clear structure for how the legal team operates, escalates risks, and works with the business. It has increased oversight and ensures that the correct people are involved in decisions and communications on business risks.
COMMENDED: Hyundai-Doosan Infracore
A new platform and a data-driven process ensure the South Korean construction equipment maker complies with new employment, antitrust and other laws and regulations. Systems automatically monitor transactions at the company to flag potential issues.
Line Corp
Creating a legal operations team is changing the way the legal team of the mobile app company — a subsidiary of SoftBank entity Z Holdings — works by developing tools to track and visualise legal requests and response times, and digitising contracting processes.
Mitsubishi Corporation
Japan’s largest trading house has set up a task force to review and lead the implementation of new legal technologies. An initial focus included introducing tools to share knowledge across a wide-ranging legal team.
Shell
The Asia-Pacific legal team has started to introduce a new supply-led operating model that gives it more control and agility in how it delivers services to the international energy company. It has launched a mobile app to share legal templates and advice, and tools to automate simple legal documents.
Talent management
Case studies in best practice. Researched and compiled by RSGI. ‘Winner’ indicates the organisation won an FT Innovative Lawyers 2022 award; other organisations are listed alphabetically
Legal teams are innovating by helping to break down silos in their organisations.
WINNER: McKinsey & Company
To keep pace with a sudden rise in volume and complexity of legal work after the business took on a number of big projects, McKinsey & Company’s Asia legal team reorganised the way it works with the company’s frontline consultants. Each consulting team now works with a single legal point of contact, who builds a deep knowledge of that team’s business.
In addition, legal team members have a “spike area” in which they have deep technical expertise, such as data privacy, technology or private equity transactions. This expertise is drawn on by the point of contact as needed.
The model was developed and piloted in Asia and, following its success, is being rolled out to legal teams in other regions.
Accenture
The legal team set an “inclusion challenge”, involving a series of videos, questions and follow-up discussions to build understanding of a range of diversity and inclusion issues and to strengthen engagement across the team following the start of the pandemic. The team used change management software that employs neuroscience principles to encourage behavioural change and is used by Accenture with its external clients. Nearly 1,000 lawyers took part, and the scheme has increased participation in other initiatives such as Accenture’s LGBT+ allyship programme.
Amazon Japan
Unlike many other Japanese companies, Amazon Japan’s legal function has recruited qualified lawyers from law firms.
The legal team of 80 includes more than 50 qualified lawyers — the largest in-house legal team of qualified lawyers in Japan.
To compete with law firms for the best recruits, it provides challenging career development opportunities, for example by moving lawyers between different Amazon businesses.
The legal team has also created new roles in a specialised team in order to engage actively with Japanese regulators.
PayPal Australia
The Australian legal team at PayPal created a clerkship programme in partnership with law firms to give graduate students experience working in-house before they start their law firm training.
The programme has deepened the team’s relationship with the law firms, helped them to develop valuable skills and also created a potential source of talent for PayPal’s legal team.
Westpac
The Australian bank’s legal team has developed its digital literacy programme by training staff in data visualisation and visual design skills. The initiative equips team members to represent complex analyses from a regulatory investigation or a litigation as diagrams, for example.
Greater flexibility, along with a focus on digital connectivity and wellbeing, has led to legal team members reporting increased job satisfaction, productivity and energy.
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