GC Powerlist > UK 2018: THE TEAM ELITE

UK 2018: The Team Elite

This year we return to the team format of the GC Powerlist, our flagship annual report chronicling the elite of the UK’s buy-side legal community. This team perspective inevitably takes us closer to state-of-the-legal industry ruminations than the editions focused on individual excellence.

Glancing at this year’s report, the second team-focused edition after the first in 2015, many long-term shifts in the profession have marched on regardless through the era of New Law and techfuelled disruption. Teams at leading companies are still accumulating more resources, skills and infrastructure to expand their empires. General counsel (GCs) at leading bluechips operating heavily in the UK are often fielding teams in the hundreds and have expanded substantially over the last three years, despite more pressure for efficiency. ‘More for less’ is a convenient fiction for GCs, but a ‘lot more work for a moderate increase in budget’ has less of a ring. ...read more

Perspectives

ENERGY

Alison Kay
Group general counsel and company secretary
National Grid




The National Grid legal team has been repositioning itself. What’s changed?

We started with a complete bottom-up analysis of the services we provide across the business and worked out we were doing things that weren’t needed. We began to position the team to be much more strategic, rather than doing the day-to-day legal advice, and in doing that we elevated the expertise within the legal team, and also gave the business much more autonomy and power to deal with some of the things that had been coming to legal unnecessarily.

How did you do that?

We really focused on our external panel: we did a review to ensure that we had firms that matched the needs of the business and were totally aligned with the goals of the legal team.

Why did it need to be repositioned?

The energy industry is changing beyond all recognition, at a faster pace than we ever could have thought, which means the business is having to change. Legal needed to change along with the business – as the business changed its ways and became more efficient and focused on process efficiency, why on earth shouldn’t legal? The other driving force was the legal world itself is changing – people are expecting it to move with the times, to rely much more on technology to look at how they can view transactions as a process and divide work up.

Has it been a success?

It has been really key to how successfully we’re regarded by the rest of the business. We’ve also tried to position legal as a business itself. There’s two definite strings: one is the culture of the business, but two, making sure that we are operating as a business unit, that we know what our budget is, that we’re not springing surprises, that we are looking at the operational efficiency of legal as a function. It is honestly something we probably hadn’t done very well until the last two or three years.

Your legal head of operations Mo Ajaz is well regarded externally. What role has he played?

I’m really proud of the focus we’ve had on operational efficiency within the team – what we can automate; what we can stop doing; how we can work better with the business; how we decide if a piece of work is going to be done internally or externally, all of which drives efficiency; getting lawyers to regularly timesheet so we know exactly where the costs are falling.

When was the decision made?

A couple of years ago I decided I needed a person in charge of operational excellence and I vowed that it would be a non-lawyer. Of course, it was a lawyer. Mo has been hugely instrumental in the operational efficiency. He’s very well respected externally and people are looking to him because National Grid has been earmarked as having taking a big step. I have no hesitation in saying that none of it would have happened without him at my side.

You’re a convert to in-house legal chief operating officers then?

I completely and utterly believe every single team should be doing it and I don’t think any team is too small or too big. It can be naïve to think ‘we’re only a team of three or four lawyers, none of this applies to us’, because it does. I’ve had a complete epiphany here. We’ve reduced the budget by 25%. It’s real, tangible, progress.



Donny Ching
Legal director
Royal Dutch Shell




What makes Shell’s in-house legal team stand out?

One of the hallmarks of Shell legal is that we do a lot of work in-house. It’s not just about the cost: it’s a fantastic opportunity to develop our lawyers and give them meaty work to handle. On the costs front, it always helps to do the big projects in-house. For a lot of our $1bn-plus deals, our legal costs are likely to be in the low $100,000s, even below $100,000. We know our counterparts sometimes spend multiple millions.

Is that typical of your industry?

It’s different. The deal we have struck with our board is: ‘Allow us to develop and grow a large legal team and we will bring the work in-house.’ Since about ten years ago when we started focusing on this, we’ve shifted our spend. Back then we were spending 60% external and 40% internal, but we’ve flipped that around.

Aside from cost saving, what are the benefits of keeping work in-house?

One of the things we absolutely hone in on is business partnering. Ensuring that we have lawyers that understand the business, understand the risks, understand the objectives; that’s absolutely critical. You’re so much more effective and efficient. Otherwise, you have to brief external lawyers, they have to read into it and it is hard for them to truly understand our risk appetite.

Have any divisions of your legal team been particularly active?

We’ve been strong across the board. The main challenge we’ve had is oil prices over the last three years or so. That’s forced us to knuckle down. It’s forced us to ask ourselves: ‘How do we become more effective and efficient and productive? How can we continue to drive costs out?’

We have a mantra now of ‘operational excellence’. It’s part of our transformation programme we launched last year where we want our lawyers to understand that improving the work is the work. Every time they do a deal or work on a matter, they should ask how they can improve and be more effective next time.

Vincent Cordo, your central legal operations officer, has been working to drive more efficient pricing from external law firms. How receptive have they been?

It was a slow start. We started in litigation, and when we brought in the firms that did the most litigation work for us globally and told them what we were going to do, some said: ‘We’re prepared to partner with you on this.’ Some said they weren’t interested, but that’s fine. There was enough of a group remaining that we’re happy to work with. It’s not as if there’s a shortage of law firms out there! We’ve also repositioned our relationship with our global panel firms, which we’ve shrunk from 12 to six. We had hundreds of local panel firms around the world that we shrunk as well. We said: ‘For those of you prepared to work with us, we are prepared to invest in our relationship so that value flows both ways.’ I wanted to move the law firms away from looking at Shell and thinking the only value they get from us is in pure dollar terms. We have started conversations and launched initiatives where we’ve offered firms in-house training opportunities, presentations from our scenarios team and business leaders, and secondments. We’re also sharing our learning from the BG combination, and helping firms with diversity and inclusion.



FINANCIAL SERVICES

Kate Cheetham
Group general counsel
Lloyds Banking Group




How is the legal team structured?

We support the whole of Lloyds Banking Group. Not just the retail bank but also the commercial bank and our insurance division. The team provides legal work across the entire group. We have six different GC-led teams. Three of those are customer facing, while three of them are centralised teams.

One of those centralised teams is the transformation legal team, which is very heavily focused on digital growth, data, legal change and delivery. We also have a legal operations team, which is made up of eight people, several of which are non-lawyers. They ensure we are as efficient and effective as possible, covering finances, resourceplanning as well as our relationships with our law firms. They’re really the glue that holds the legal team together.

How would you describe your team?

We have an experienced group of GCs who are responsible for the various divisions across the bank. Some of them have been here for a long time while others have joined more recently. They’re a lovely, diverse team.

Are there other in-house teams that you take inspiration from?

Look at our peers: the other big banks have very strong legal teams. Diageo is another example of a team that does a fantastic job in working out how the team operates and making sure they are doing interesting things. I really love going to round tables and seeing how people do things differently. It’s fascinating talking to GCs at start-ups, which are completely different organisations. I’ve had some really interesting conversations with start-up GCs.

How does GDPR and cyber security affect your legal team?

Both are areas of significant focus for the group. I talk a lot about the need for speed alongside the need for security. We need to make sure we are doing everything we can to ensure we are vigilant and efficient. Making sure our terms and conditions are compliant with GDPR is a substantial project, and we have made great progress here.

Cyber security is much more of an ongoing focus, but it’s something absolutely critical that we do. We invest a lot in it. We work with other industry groups to make sure that our cyber security is good but also that our customers feel safe that their data is well protected.

What have been some of the more interesting tech initiatives or innovations the legal team has been involved with?

The group has recently announced its latest strategic review, which focuses on transforming the group for success in a digital world and our role is to consider how we best support the group. In that sense, the innovation piece is really important for us. An example of what we’ve achieved is a new system that analyses all the decisions that the Financial Ombudsman Service (FOS) makes. It allows us to scan a mass of decisions. We’re the first organisation to have a direct link to the FOS website, which has been really exciting for us.



REAL ESTATE

Philip Bramwell
Group general counsel
BAE Systems




How is your legal team structured?

If you’re a Western defence company, you’re basically dealing with the Five Eyes nations [Australia, Canada, New Zealand, the UK and US]. BAE Systems is the most global of the defence companies, so our legal department reflects that. We number about 250 overall – half lawyers and half regulatory experts. The basic principle of the organisation of the legal function around the world is to have the lawyers as close to their client base as we can get them, so it’s a blend of commercial generalists and making sure that we’ve got geographies covered where we have multiple lines.

How has it evolved?

It will flex from time to time, even in a mature legal department. An area like cyber security is big for us now; it wasn’t five years ago. Broadly, our concept of operation remains the same. We have a clear sense of legal community globally and all meet once a year.

What is that concept of operation?

We have a very clear understanding of legal valueadd, influenced by the work of American academic Constance Bagley, which splits in-house work into three prongs. The first is latent demand from people in your organisation looking for legal advice: that’s good we want to be in demand, but it’s self-diagnosed. That’s the pull dimension, whereas the push dimension is the work we do to enhance and protect the value of the enterprise, work across the business to meet standards set by the board, which has no appetite for compliance or regulatory failures. Bagley says there has to be a third dimension, however, or else it’s a zero-sum game. If you don’t invest in making the business what she calls more ‘legally astute’ – more aware of the laws and regulations that affect it – then you will in perpetuity have a constant level of demand that’s proportionate to the scale of the business and it will not learn to be smarter.

How do you measure that?

Those three dimensions inform the way that we manage and think about legal value-add and also the way that we articulate to management what we are delivering. I get third dimension legal value-add reports monthly from my lawyers around the world that say: ‘These are three, four things we’ve done over the last month that are adding value above and beyond the day job.’ It might be two hours of training to 100 people on a piece of regulation, which reduces our risk of violations. Training is a classic example of somewhere we want to make a very heavy investment. Keeping managers aware of legal developments, legal risk, regulatory risk, means they in turn generate less work for us. That’s the dream.

It’s about front-footing problems?

Front-footing: that’s a better way of putting it. I’ll steal that.

How do you manage the three dimensions effectively?

I have to make a business case like anyone else looking for investment, so when I need more headcount I go to the chief executive and say we’re altering a few things, but we’re probably looking at a few extra heads and if we don’t we’re going to face big external legal bills. Is my team drinking from the firehose or are they going to have sufficient capacity to get out in the business with their non-specialist colleagues and raise the state of awareness in the business? I’ve never been refused when I’ve made a business case.

How have the demands on in-house teams changed?

We’re very fortunate to take associates and senior associates from top-flight law firms around the world and we benefit from that enormously. If you get a great gene pool then you will have an adaptable and hugely-able legal department, and I believe that’s what we’ve got. We have people willing to uproot and take themselves off to other sides of the world, making huge sacrifices with young families. I think international career experience is going to be important for those who want to reach management levels in the legal departments in global companies, I spent a decade overseas in my career and it helps you in a number of things. First of all it helps you to put your own home country in context. You talk to people and socialise with people who are not your countrymen and don’t know anything about your country. The UK thinks it’s the centre of the universe. Years later, as a GC, you have some empathy with what people are going through in overseas assignments: it’s a non-trivial thing to ask someone to do. Looking forwards – certainly for the Millennials that we’re recruiting – getting them

Lead sponsor




The best teams are founded on diversity. And by diversity I mean diversity of thought, diversity of experience and diversity of leadership, as much as anything else.

If ever there was a time to reflect on the importance of diversity – in all its forms – in the era of #MeToo, #TimesUp and the gender pay gap, that time is now. Irrespective of whether studies show that greater diversity delivers greater performance – they do – ensuring we run balanced teams and organisations that offer equal access and equal opportunity is simply the right thing to do as human beings.

And I’m saying this as a white, male, middle-aged leader of a City law firm in the full knowledge that, as a sector, we have a very long way to go. Like other sectors, we’re rightly being held accountable by our people, by the government and by the media. Critically, we’re rightly being held accountable by our clients, too.

As clients of City law firms like RPC, those represented in the Powerlist are playing an increasingly leading role in ensuring diversity doesn’t just rise up the agenda, but stays there.

What particularly struck me about the list of topperforming legal teams showcased in this year’s Powerlist was also the diversity of organisations represented, from start-ups to established players; technology companies to retailers; and UK-headquartered operations to sprawling global giants.

The business issues that these companies face will be many and varied. It stands to reason, then, that the greater diversity in the teams advising them, the more commercially-valuable the advice they will be giving. It’s about being able to consider commercial challenges from a range of viewpoints – the broader the range, the more complete the advice and the better the end result.

And, increasingly, in-house lawyers are having a major influence on the ultimate end result: the bottom line. Over the six years we have been involved in the GC Powerlist, my perception is that the role of the in-house legal team has become progressively more critical to the successful running of businesses. The in-house lawyer has moved on from being the moral compass to becoming an indispensable business adviser to the board. A growing number are achieving that coveted seat at the table.

That’s never more apparent than in a crisis situation – such as a major cyber incident – when, more often than not, the GC and their legal team are at the heart of managing the response. Caught in the maelstrom, that’s no doubt a challenging place to be. But it’s a significant opportunity to demonstrate commercial value, too, not least when your share price can rise or fall on the basis of the decisions you make.

So, having a strong sense of leadership and the right team around you is absolutely key. And, in my experience, balancing a shared sense of purpose with a good degree of autonomy helps to drive the high-performance culture we all strive for. But, running through it all, is communication – if you don’t have open and fertile lines of communication then, at best, you’ll have pockets of high-performing individuals. Great communication is fundamental to great leadership – and both are fundamental to great teams.

This publication is a list of truly great in-house legal teams. Congratulations to all of those who have been featured.

James Miller
Managing partner Tel: 020 3060 6517
james.miller@rpc.co.uk

Associate sponsors

Cornerstone Research




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The depth and breadth of our experience, combined with our extensive expert network, provide clients with an unmatched level of consistent high-quality work and effective support.

Peter Davis
Senior vice president
Tel: 020 3655 0910
pdavis@cornerstone.com





The role of a general counsel (GC) has developed substantively over the last decade due to increasingly complex regulation, technological advancements and globalisation. GCs now bring more to the table than just their legal expertise and act as strategic legal and business advisers to the chief executive and executive leadership teams. Recruiting and developing the right talent has become harder and even more critical than ever before.

GCs are now viewed as the go-to advisers for chief executives and boards of directors on laws and regulations, as well as public policy, ethics and risk. In addition, GCs now possess broad financial acumen and commercial understanding, leading them to also participate in senior leadership discussions on complex business problems and to provide innovative solutions. The GC has become a principal member of senior management teams and offers advice not just on legal matters but in helping shape discussion and debate on broader business issues.

Among in-house senior lawyers, individuals that stand out have deep financial understanding, including the ability to read balance sheets, interpret profit and loss statements and have the ability to collaborate and develop close relationships with finance departments. Senior lawyers who aspire to become GCs must expand their business knowledge, gain diverse financial acumen and develop strong leadership skills. Joining crossfunctional strategic projects is an example of how legal talent can learn about other areas of a business and develop a broader organisation-wide understanding.

The quality of leadership is one of the most important predictors of the success of an in-house legal function. The combination of career experience, characteristics, competencies, values and motivations determine an individual’s ability as a successful leader. The most critical competencies required of today’s strategic legal adviser are organisational awareness, ensuring accountability, collaborating by building relationships across the business and having the courage and gravitas to challenge chief executives and boards, when appropriate.

Overall, when appointing the next GC, it is important for organisations to look beyond legal expertise and consider broader business and industry knowledge, as well as ethical values and cultural fit.

Corinne Lennock
Senior consultant, legal and compliance EMEA
Tel: 020 7337 2722
clennock@foxrodney.com





Legal departments and law firms are under increasing cost pressures and it is no longer about doing more with less; it is simply a question of efficiency: top-quality output with less cost, fewer people and fewer mistakes. This leads the enlightened to the hot topics of business and digital transformation, which go hand in hand with technology and raise the issue of digital trust.

Automation of processes, secure and instant collaborative working and artificial intelligence provide huge opportunities for increasing efficiencies and quality, and creating the transparency that engenders trust in the client/provider relationship. Coupling this with the inherent security advantages of such technologies, a firm awareness of the associated risks, and adherence to an ever-changing regulatory and statutory landscape, gives the opportunity to create an environment of digital trust.

Safelink provides a highly secure means of increasing the efficiency of smart delivery of legal services to, and by, in-house legal departments and law firms, while adding strength to GDPR positioning.

Providing tools that encourage the building of trusted relationships between law firms and their clients or internal legal departments with their panel firms requires flexibility and attention to the specific requirements of the relationship. The trade-off between security and convenience in the technical age is ever-present when considering issues of digital trust, and customisable tools that give absolute security and the flexibility to meet specific reporting needs can be hard to find. Tales of woe that appear regularly of data breaches and malware issues beg the question of who or what will be next?

At Safelink, security is at the heart of the delivery of all our services and is woven through every part of the system. Coupling that infrastructure with the ability to customise tools to the degree that will simplify the delivery and receipt of legal services strengthens the bond between client and legal service provider. While we do not pretend to offer the panacea to all these issues, we listen hard to what our clients are telling us and work hard to deliver well-thought-out software that makes sense in the hands of the user.

Harry Boxall
Director
Tel: 020 8798 3140





Legal departments and law firms are under increasing cost pressures and it is no longer about doing more with less; it is simply a question of efficiency: top-quality output with less cost, fewer people and fewer mistakes. This leads the enlightened to the hot topics of business and digital transformation, which go hand in hand with technology and raise the issue of digital trust.

Automation of processes, secure and instant collaborative working and artificial intelligence provide huge opportunities for increasing efficiencies and quality, and creating the transparency that engenders trust in the client/provider relationship. Coupling this with the inherent security advantages of such technologies, a firm awareness of the associated risks, and adherence to an ever-changing regulatory and statutory landscape, gives the opportunity to create an environment of digital trust.

Safelink provides a highly secure means of increasing the efficiency of smart delivery of legal services to, and by, in-house legal departments and law firms, while adding strength to GDPR positioning.

Providing tools that encourage the building of trusted relationships between law firms and their clients or internal legal departments with their panel firms requires flexibility and attention to the specific requirements of the relationship. The trade-off between security and convenience in the technical age is ever-present when considering issues of digital trust, and customisable tools that give absolute security and the flexibility to meet specific reporting needs can be hard to find. Tales of woe that appear regularly of data breaches and malware issues beg the question of who or what will be next?

At Safelink, security is at the heart of the delivery of all our services and is woven through every part of the system. Coupling that infrastructure with the ability to customise tools to the degree that will simplify the delivery and receipt of legal services strengthens the bond between client and legal service provider. While we do not pretend to offer the panacea to all these issues, we listen hard to what our clients are telling us and work hard to deliver well-thought-out software that makes sense in the hands of the user.

Bob Storey
Managing director, legal solutions
bob.storey@yerrasolutions.com


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