Crystal Lalime, Head of APAC Global Markets Legal, Credit Suisse
As fintech becomes an increasingly important component of all financial institutions, Crystal Lalime
discusses the approach at Credit Suisse and the role of Legal in driving progress.
GC: Technology in finance is a hot topic – especially here in Hong Kong. What are your perspectives on this and what is Credit Suisse doing in this area?
Crystal Lalime (CL): Technology is changing finance, it is changing banking and, in the process, creating new pathways for Legal to play a role.
Recently, we partnered with a fintech company called Canopy Pte Ltd. What their technology allows is for clients to consolidate their accounts on the automated account aggregation platform, so an individual can manage their whole portfolio from a single platform, which is quite a powerful tool for our clients. We identified a company that we thought provided a very good solution for our clients and took an investment in the company to provide that service to our clients.
This is a major trend in the industry and we are very much a part of it.
GC: Can you describe the partnership approach that Credit Suisse takes to working with start-ups?
CL: With start-ups, you see a lot of interesting technology, but a lot of the times it becomes about who they partner with, where their distribution chain is, what their path to market is and whether there is a really strong use case. As lawyers, we can’t necessarily keep up with the technology development, but we certainly have ideas about how they can be partnered with or integrated into Credit Suisse.
Our approach so far has centred on just that – partnering. A lot of AI technology partners may be attracted to partnering on certain projects with us because of the large data dumps we can provide to train their algorithms, but oftentimes finding a use case that makes sense on the legal technology side for CS and the technology provider can be time-consuming.
GC: When working with start-ups, what role is Legal asked to play?
CL: As we look at these opportunities with start-ups, that also presents new challenges for Legal. Oftentimes, start-ups aren’t as well governed as we’d expect – particularly with the high standards we’re accustomed to operating within. Legal plays a prominent role in advising on the due diligence and sometime restructure of start-ups, which isn’t unexpected – these are M&A deals after all – but the issues which arise can be more varied.
When you’re running a start-up, budget is a huge consideration, but when you’re working with financial institutions – areas like compliance are ones where there isn't room for error. Sometimes you’ll see that there are certainly the right intentions in mind, but a start-up might employ a junior compliance officer to help them get on the right track – but as you scale up and you’re running a big platform – the compliance may be extremely onerous.
Once a partner is identified, there’s a whole host of further issues for Legal to consider. What are the processes in place for handling data, moving data and protecting data? If we’re co-developing products, who is going to own the IP? What about if there’s interest from other financial institution's to licence the technology – how do we handle that? It takes a lot of creativity and diligence, as well as constant training and upskilling for the legal teams who may have previously been advising on selling products and are now involved in offering software services. There is a lot of crossover and innovation requiring product and IP legal expertise. We’re not just providing advice on legal issues – advising on strategy.
GC: Being asked to work on projects like this is outside of the typical scope we often hear from GCs – particularly in finance. Have you had to adjust your approach in terms of hiring or training your staff as a result?
CL: That is a real challenge that we face. It comes back to the core values of our GC department, which are legal advisory, legal service provider and strategic adviser. To continue to provide these in a changing environment, it means that we have to be constantly upskilling – and that goes both for myself and for my team.
It also means that I’m more frequently taking stock of what skillsets we have on our team and what we might need to stay ahead – one day it could be looking for a programmer or a computer science person, the next we could be looking at these start-up-style deals, where perhaps we need people specialised in IP or outsourcing – it’s really about constantly staying on top of what we have and what we need.
I think as a broader trend, this is true for a lot of legal departments. The nature of legal work, as much as it stays the same, the applications change and how we go about completing that work is changing too. At the moment, many of the lawyers on my team are working with technologists (e.g. programmers and other platform specialists) – that’s a direct result of a lot of our legal documentation being automated. On the team, you have to have lawyers willing to do what may be perceived as non-traditional legal work and explain to non-lawyers our trade. That goes both ways too – on the other side, we need to have programmers and technologists who are willing to work with lawyers. It’s a paradigm shift and the overlap between technology and legal is growing constantly – and that’s not something I see changing any time soon.