Henk Crouse was the first general counsel for HSBC in Africa, having taken the role upon the bank’s first entrance into the market. And now, nearly 20 years later, having been the most consistent presence in the South Africa office among multiple CEO arrivals and departures, Crouse is retiring.
Crouse entered the legal profession as most in-house counsel do: as a private practice lawyer. His first in-house job was as in-house counsel for Nedbank, a regional institution headquartered in South Africa. It was here that Crouse got the offer to serve as general counsel for HSBC, which, at the time, was preparing to open an office in South Africa.
‘I was at Nedbank for 12 years and was very happy, but I thought, “What a great opportunity to start a bank and see how that is done”. And the bank had a good reputation as well – the brand was beautiful – and I thought it would be good to work for a local bank, and then an international bank, and compare the two,’ says Crouse.
‘It was a special opportunity and I felt I’d be stupid not to grab it. With the bank’s reputation and the brand, it was an easy decision.’
Becoming integral to the business from the start
Any incoming general counsel will speak of an adjustment period as they grapple with the legacy processes and expectations left by their predecessor. To be the first adviser for a company entering a new market presents a different set of challenges, as Crouse discovered.
‘To a great extent, I carved the role out myself,’ explains Crouse.
‘A lot of it comes down to your relationship with the CEO and how you market yourself – how you’re seen, what image you want for the legal department. Do you portray yourself as an integral part of the business? Or do you see yourself as an independent legal firm giving advice? And I think in 2000 [the latter] was the approach. But I think things have changed quite drastically. Now, you’re part of the business, you run with the pack. You go out with the relationship managers to the client, you negotiate the contracts, and it’s absolutely essential to have a legal head.’
It has been this focus on relationships from the outset, Crouse says, that has shaped the growth and success of him and his team. This emphasis starts with team building and, as the inaugural member of the team in South Africa, the building started from the ground up, with the success or failure of the team largely relying on getting this preliminary step right.
‘My whole career, the relationship of the legal department with the rest of the business has been very important to me. So when I came to HSBC, I wanted to continue with that, to be the best legal department. So, certainly, I think the most important thing is to appoint the right people. I was in a privileged position to have my pick of the crop. And when I did my interviews, the most important thing to me was to get a cultural fit. Because if you have a cultural fit and you become a family and set the values, then everything is fine. But you may have very intellectually strong people that have different work ethics that wouldn’t work.
Cultural fit is hard to measure, but Crouse’s faith in his own selection process is well founded as it turns out: in the 19 years he’s been at HSBC, he’s had just four resignations. This is no accident and, according to Crouse, is the result of a carefully developed leadership approach that was borne of experience.
‘I drive to work every morning and I think: “Which of my staff members may be unhappy? What did they say yesterday? What did I pick up on?” I think it’s a manager’s job to make their staff happy. And it’s something very important at HSBC – we’ve got something called the “Healthiest Human” system, which is basically to say that staff are the assets of the business and we have to look after them. Therefore, we have to accommodate their needs as well. If you want to work from home, work from home. In HSBC, that’s become common in the last year, but it’s always been here in legal, because legal is so easy to see – for instance, if you are working on a contract from home, it’s either going to be done or not.’
He adds: ‘The most important thing for me in my relationship between me and my team is that it is a trust relationship – I think it’s essential. They trust me completely with what they tell me – they are extremely open and honest. And I am very honest with them as well. I think this is the secret of the success of what we are doing here.’
Setting the agenda
With his department’s relationship to the rest of the bank front and centre, each year for the legal team starts with a high-level strategy meeting, which stays relatively informal and takes place off-site. This, Crouse says, is as much about getting buy-in from the team as it is about the finer, practical points of the team’s plan for the year.
‘I first get their buy-in and ensure that we are all on the same page, that they are part of the decision-making. Then, we basically work out an annual plan. I look at our customers and clients: and, to me, that’s mostly internal parties. Each year, everyone on the team will have been allocated a relationship with somebody. For instance, I might be allocated global banking, someone else may be the IT person, and another will be trade. Then, you also get two dates a year in the annual plan where you have to go and see them, with a questionnaire, asking them what they’re happy with regarding the services our team provides.’
The focus on building the profile of the team within the business is the starting point, but it also influences the approach of the team throughout the year, as Crouse explains:
‘I have two golden rules in legal.
‘The first one is that there must always be somebody here. If you’re the last person that leaves, you are not allowed to leave. There must always be a physical presence here. If the phone is ringing – be it yours or somebody else’s – you must answer it.’
‘Secondly, you must be very well prepared for meetings. It’s the only window where you can show how smart you are in front of very important people. The challenge is not to simply be friendly and accommodating. You must challenge people in a friendly manner to make the whole committee think of different options. They may not be right, but the idea is to give options and not have only the chairperson saying one thing and then everybody following. To me, that’s the essence of marketing yourself and raising your profile.’
Keeping it together
With just four resignations in the nearly 20 years Crouse has run the legal function at HSBC, it doesn’t need to be said that retention is not an issue for his team. Though not entirely unique, such retention is uncommon on in-house teams, where progression isn’t guaranteed or definitively structured in the same way it is in private practice. He attributes this to a sense of pride that has been instilled in his team:
‘Retaining talent hasn’t been tough. We do the normal investment banking work and then we do derivatives and things like that, which are not that simple, but honestly, if you’ve passed an LLB then I think you can do the work. To me, it’s more about the leadership and how you can lead and infuse and inspire your staff and – most importantly – it’s about pride. What pride do they have in their work? And I think pride is, in essence, what drives my team.
‘We’ve got such a good reputation and you hold it so dear that you don’t want to let go of it. Yes, sometimes you work 14 or 15 hours a day because of pride, which is not good, when it would have been better to say “Sorry, I can only deliver that in two days” and get extra help. So there is a negative side as well – sometimes you push yourself too hard because of pride. Sometimes you have to just calm them and say, “Okay, this is going overboard – we must now send a message that we need more staff because we are consistently working too hard.”
‘I think if you ask me “What image do I want in the bank?”, I think I have that reputation in the bank and within my team that I am really trusted. People come to me with their problems. I really honour that.’
The life of the in-house counsel often changes significantly from year to year, so to have occupied the same post for nearly 20 means that Crouse has had an unusually consistent front-row seat to changes in the company, the industry and the wider profession.
For instance, having worked at HSBC for nearly two decades, Crouse has seen chief executives come and go and, as such, has been a part of multiple sea changes within the business, and has had to learn to communicate his team’s ethos and success to a variety of personalities.
‘At HSBC, I’ve worked with four or five CEOs. Everybody had different styles. That is very important. My view, in interviews, as part of my questions – and something I honestly believe – is that EQ is more important than IQ. I think it is. If I negotiate, I must be able to read what that other person’s soft spots are, and how I should embrace them and make them see my point of view. So, basically, I have to take my glasses off and see him through his own glasses. That’s the same thing with the CEO. It’s very important that you can relate to them and they can relate to you. That you can form a trust relationship going forward. It’s essential for the CEO to trust you. The CEO trusts you, and you’re the right-hand man – you’re their legal adviser.’
Internally, Crouse also says that the role that external firms are playing in the market has changed over the years:
‘I think external panels are more expert and not so much general. I think your legal advisers in South Africa have become more generalist and not so much specialist, and you get your specialist advice from external legal firms.’
It should also be no surprise that technology has been a key driver of change over the course of Crouse’s career, and his team’s approach to external firms is no exception to this. Crouse uses an app to manage his relationship with his external firms, which tells him the general rate of each attorney and asks the user to give feedback on the attorney based on performance, whether he’ll use them again, whether their fee has changed since the last time they used them. All of this reduces overhead for Crouse and his team – a positive – but he still maintains a cautious approach when it comes to legal solutions promising cost-saving innovation.
‘HSBC is very particular about who we are dealing with. We only basically deal with very reputable legal firms where there is no reputational risk for us and no risk of bribery. It’s very easy for a legal firm to be involved in bribery in getting licences or preferable judgments. So we do a month’s due diligence on a legal firm before we have them on board. It’s unlikely that we will deal with a start-up company that we don’t know and that don’t have a reputation. It’s too difficult to get through all the layers. From a reputational point of view, we’re very hesitant to deal with start-ups.’
The marketing of legal
It is one thing to have a legal department that the general counsel knows is successful, but truly measuring that success and communicating it with the rest of the business is an important of the job for Crouse, and is integral in building the bridges with the rest of the business of which Crouse and his team are so proud.
‘I can honestly say that we are the poster-boy department – we are held in high regard.
‘Firstly, we are being recognised for prizes internationally, so that gets advertised within the bank and people respect you for that. Secondly, I do surveys twice a year. I will ask people questionnaires before the performance appraisal, and ask them what they think about the team, so I get feedback that I can monitor.
‘We also have a thing called “At Your Best” at HSBC, where everybody gets allocated a certain amount of points, and every point has got a monetary value. Let’s say everyone gets 100 points, and you can allocate that to staff that you think deserve it. And HSBC very often acknowledge the legal department.
The emphasis on ‘being seen’ that Crouse talked about before also plays a part here. He refers to it as the team’s ‘marketing strategy’ – asking questions of the business, both inside meetings and out; ensuring his staff are very well prepared for meetings internally; and ‘walking the floor’ among internal clients to have light conversation and give internal stakeholders the chance to ask questions and give feedback.
Now that Crouse is approaching the end of his chapter at HSBC, this top-level strategy-setting has taken on a different character, and his attention turns to the future.
‘My approach has definitely changed. I have done some internal training for my successors, so I’m very confident and comfortable with that. I’ve already had an informal discussion around when I’ll start stepping back, what meetings I’ll no longer attend or what ones I’ll attend with my successor. There’s certainly a plan.’
Retirement means different things to different people but, for Crouse, it does not mean a total erasure of his working life. Crouse’s creative side has manifested itself already, with Crouse publishing a book alongside his time at HSBC in 2005. Titled Man Op Die Dak, the novel was shortlisted for the Eugene Marais Prize in 2006.
‘I’ve published one book, I’m going to write another book and have been approached by a publishing house. They’re disappointed I haven’t retired already. I look forward to that – to touching the creative side. I like the arts.’
‘I want to give back to society – I would like to get involved in schools and start training and inspiring kids. I think it’s important to inspire youngsters who you can still set into the right direction. To inspire professionals – they’re already on the right track. If I were to give back, I’d rather work with kids that you can still form and change their lives. I think it’s possible to do that.’
‘I would rather train youngsters for the corporate world. I know that’s more my strong point – to enthuse people.’
Advice to younger self, leadership
Now that Crouse is looking back on a lengthy and prolific career, what does he wish he’d known from the start, and what advice would he give to others at the start of their legal and business careers?
‘Something that I wish I’d learned at a really early stage – and that is that the corporate world is not a popularity contest. Why I’m saying that is that the younger you are, the more insecure you are, and the older you are, the more comfortable you are in your skin.’
‘But when you are in your early 30s, it’s the decade that you have to work the hardest in your career, because those are the make-or-break years. When you’re 40, you realise what you will and will not achieve, and you will make peace with it. In the 30s, you don’t know where you’re going to end, you just know the harder you work, the better the chances are.
‘If you’re insecure, you want people to like you because you think that’s essential. But how senior management see it, is that if you’re popular and if there’s a meeting and X says “Let’s do Y” and you say “Yes, I think that’s the right thing to do” and you don’t challenge that, they see you as weak. So if you want popularity and it becomes evident in meetings that you say what is expected, then senior management frown upon it. You should rather be more challenging, and try to set the meeting in a different direction. They’ll have much more respect for you and you’ll be promoted much quicker than if you just become popular. I wish I’d learned that at a younger age.’