To read unpublished excerpts from this profile, including more on Lynch’s stint at ABN AMRO, click here.
For Kimberly Lynch, the opportunity to work at one of the world’s oldest independent futures commission merchants was not an obvious career move. Then she found out that R.J. O’Brien and Associates was not looking for a futures lawyer, but for someone who could step into the role of the company’s first general counsel. She realized that her experience in international banking and the over-the-counter market would be a good fit.
Her first taste of finance came after law school, working at the Federal Reserve Board where she did a lot of legal work in international banking. After spending five years at Mayer Brown in New York as an associate working on capital markets, regulatory and finance, she went on to spend the next 10 plus years at ABN AMRO Bank and its subsidiary LaSalle Bank Corp. Most recently she was senior vice president and associate general counsel at LaSalle Bank Corp., heading the regulatory and corporate affairs group.
When Bank of America acquired LaSalle Bank Corp., Lynch decided it was time to move on. She has her work cut out for her as the one-person legal department of the 94-year-old, Chicago-based R.J. O’Brien, which she joined in June. Aside from having a lot to learn about the futures industry, as the company’s first GC she also has to figure out the appropriate responsibilities for a general counsel at a futures commission merchant, which accepts orders to buy or sell futures or futures options on commodities.
Q:Why did you have reservations about R.J. O’Brien being a good fit?
A:I got a call from a recruiter and my immediate reaction was that I’m not a futures lawyer, but he convinced me that I could be. After only a month I could see the rationale for why this is the right fit because R.J. O’Brien was not looking for a futures lawyer per se, but for someone who could handle a general counsel function–including contracts and corporate governance issues. And when it comes to that, they have a great compliance department here that already handles most of that pure futures work in compliance. Since I have been here, the issues have not been futures-related but have dealt more with counterparty risk, governance and contracts.
Q:What’s it like being the company’s first GC and a one-person legal department?
A:It’s great because everyone really wants an in-house lawyer here, which is not always the case. Sometimes
people don’t want lawyers getting in the way of how they do things. But because they haven’t had a GC and because legal questions about contracts keep coming up, they really saw a need for one. People here had been saving things, mostly contracts to review, waiting for when the lawyer finally arrives. It’s a nice position to be in.
Q: Is working on contract specifications difficult?
A:Yes, but thankfully the industry has a lot of market standard templates, which makes a lawyer’s job very easy because we have something to start with, but everything gets negotiated back and forth on the actual specific terms. I had done a lot of that type of work at the law firm so it wasn’t new to me.
Q:Besides contracts, what else does the position involve?
A:Assessing risk in the markets is another part of my job. Risk is a big issue. The challenges that have come up with these markets are concerns about credit or other risks. I’ve been called upon to help assess whether we should be demanding more margins or if we should be liquidating a position. But I haven’t actually had a chance to go through all our forms to readily be able to answer those questions. I have to take some time to review them all.
Q:What are your main goals as the first GC at R.J. O’Brien?
A:I am going to focus on providing legal services in an efficient yet business-friendly way. You have to have a good enough relationship with the business side so that they want to come to you–rather than coming to you because they have to. I need to be able to support them in a way that’s efficient both in terms of time and money and other resources.
Q:What is the biggest challenge in your new position?
A:The biggest challenge is that I need to hit the ground running without the luxury of having a great understanding of all the infrastructure behind how things operate here.
Q:What is the main thing you want to focus on right away?
A: Litigation management. Generally litigation is handled by outside counsel but overseeing all of that is also part of my job. I have to figure out the most efficient resolutions and settlements because you can’t leave something like that entirely in the hands of outside counsel. If you stay on top of these things then you know they are incentivized to find the cheapest resolution.
Q:Do you need to hire more lawyers?
A:I’m still in the assessment phase. I certainly will need help of some kind, but what that is yet I don’t know. I already have help in compliance, and I’ve already taken on a lot of simple contract work, for which there’s no need to send to outside counsel. I still have to figure out what else we can do more efficiently versus
having someone do for us. Everyone asks me, “How do you want to handle this going forward?” and I just say, “Let’s start with sending it to me. Send everything to me, every contract amendment, everything.” That way I get a sense of what’s out there.
Q: Regulatory work is complicated, especially in the futures markets. How do you take that on?
A:I had an advantage coming from a banking world because I picked up on a lot of technical expertise. The risk tolerance of an institution can greatly affect how difficult or easy your job is and that can also change over time. An institution may be very risk-tolerant, which makes your job very hard. Then you can get the opposite–an institution with a zero tolerance regime, which makes a lawyer’s job very easy. But the problem with zero tolerance is people don’t really make money in that kind of environment. Finding the right median and having the right kind of support from high up on that front is critical.
Q:There’s always something happening in the futures world. How do you deal with the constant changes, especially the regulatory ones?
A:There’s a lot of volatility in the markets and evolution, but for me it’s not just about keeping up but also learning because the whole futures aspect is new to me. There are certainly similar concepts in securities laws and there is a relevant background from the securities world and from the over-the-counter world that I can carry into this. I have a very steep learning curve, but at some level it comes down to, you know what you know, you know what you don’t know and you know to whom to go for what you don’t know. I certainly feel pretty comfortable regarding the lines of support I have available from other people.