Below is LNT Partners report from last week’s 2015 IPBA 25th Annual Conference in Hong Kong (May 5 – 10).
Day 1 – Summary of Plenary Sessions
Part 1: from CEO/General Counsel (GC)
- IPBA vision for the future: increased role of lawyers in KYC banking & finance. Or the rise of rule of law in general.
- While Justice Ma talked emphatically about Magna Carta and the Rule of Law, other CEOs don’t like over-regulation. Globalisation, labour protection, customer protection, anti trust, anti corruption.
- Right now US is dictating the way laws should be drafted or interpreted. Speakers excited to see how China might change this. For ASEAN countries who fall into this — it’s hard to find the right way to interpret the law.
- Although global law firms play important role in serving clients, MNEs are starting to use more local law firms because local regulations and local market need local knowledge.
- For the future, China will impose rule of law to the market and make the interpretation of the law more clear. So it is the future for ASEAN countries.
- The special feature about China (or Vietnam) is that the law is policy driven and therefore should be predictable if we try to understand the policy and not just the Rule of law as an abstract concept with liberal interpretation.
- China was praised for having “effective” government. Rule of law is the way in all countries but at the same time people become more reasonable with mediation and arbitration instead of court settlements .
- As for China silk road, it is a counter action with US TPP. Not sure about this assessment but I think TPP is more transparent and free-trade driven. Another major China initiative is AIIB. This is a challenge to ADB.
- The challenge now is to understand the client’s needs. Clients must understand their host governments and consumers. They need local knowledge.
- Another trend is legal training for clients so the clients are responsive to the government action and build long term relationships.
- In short: Not only lawyers need a business mindset but also business people need to have a legal mindset.
Part 2: From Firms
- Reaction from law firms to CEO vision of the future: Establish closer relationships with corporate counsel. Law firms should be more efficient as clients save cost as they build internal legal departments. Lawyers can learn from accounting firms to survive.
- While trying to become efficient, law firms make their products less bespoke but more a commodity. This must be offset by legal training and client care.
- With Globalisation, big firms will get bigger but boutique firms can do well. Each firm should have a strategy to either go global or go boutique. This thinking is not what I saw in previous sessions. I think even when clients go global their needs are local. Local firms are important for tax, employment and litigation — at least .
- Speakers said every firm, whether global or local, would need to be proactive . They need to have customer and legal insight rather than just being global or big.
- Technology will restructure the legal market, including legal fees. Clients expect fix fees/capped fees in most transactions, except disputes.
- Market will become more fragmented . Law firms must be more technology-efficient. Clients want cost control.
- At the same time, the challenge for global firms is that partners and associates demand more and more each year. That might urge them to employ less and cooperate with local firms to save cost and pick the best lawyers.
- More big firms are using the salary partner model to grow. The role of MP will become more important than consensus. So vision, strategy and delegation are watch words.
- Client GC wants: “Make me look good”. It all comes down to communication.
This was also published by Asia Law Portal