EADS’ Adam Smith asks how the modern GC can reconcile the local nature of law with the realities of global business
These days, any self-respecting company needs to declare global ambitions. To be in tune with the zeitgeist of the early 21st century, one must ramp up one’s presence in China, India, the Middle East and North Africa. So, in corporate legal departments around Europe, we lawyers nod sagely and promise that we will accompany our clients on these exotic projects. Of course, most of the lawyers are Europeans like me, with little or no exposure to the legal systems of those places. So (like all good professionals) we make it up as we go along and hide our copy of Libyan Law for Dummies under a pile of learned papers.
We feel comfortable doing so, because actually laws are not just local. In fact, many of the laws that we deal with are already broader in scope than the jurisdiction of the particular project (e.g. European Union laws, contracts based on UN standards, or the jurisdiction-neutral documents of entities such as ISDA or the ICC). Or they are the laws of another country anyway, for example, US arms-control regulations.
Moreover, the continental-style agreement where the parties rely on some arcane Napoleonic code to fill in all the drafting they couldn’t be bothered to do runs counter to my Anglo-Saxon training. I like to see a nice long agreement that contains all its own legislation, like one of those fine-print dictionaries that comes with its own magnifying glass. With everything you need to know already written in the agreement, who needs local law?
So, much of the content of an in-house lawyer’s job is outside our home jurisdiction, but we don’t mind. After all, we don’t need to be experts; we can outsource that. We’re supposed to be legal project managers.
In fact, this divergence between technical expertise and management mindset creates a tension that large legal departments are starting to feel. International companies expect their senior staff to be mobile: you only get the key to the executive washroom if you have experience of plumbing systems in several countries.
When I objected to one human resources director that lawyers are one of the least re-locatable resources in a company and that we should be excluded from such rules, he pointed out that my own example disproved my argument. I have already been a lawyer in three jurisdictions and I’m only just out of short trousers.
Lawyers can move but only if, like me, they have a weak grasp of detail. I can be a technically impoverished lawyer anywhere in the world, not just in England. We should probably stop worrying about how to move lawyers who are anyway no longer doing much law and instead focus on how to retain and motivate those skilled specialists who really would be no use outside their home jurisdiction.
For this, we need to lay out some kind of ‘expert’ career path that diverges from the management route, so that these valuable but non-transferable people don’t get stranded. Technical expertise is often undervalued in the corporate environment, where having a Type-A personality is more important than being able to remember the exceptions to the nemo dat quod non habet rule, but sometimes you want advice from someone with a big throbbing brain, not a big throbbing Mercedes.
Outsourcing the local component by hiring lawyers on the ground is, of course, usually safer than the Dummies guide when it comes to advising management, whether that Libyan contract is valid or not.
Thankfully, we have two models to choose from: the big Anglo-Saxon law firm that recently mopped up half the local hotshots and is manfully forcing them to use PowerPoint, or the other half of the hotshots who still think they can make a living from membership in some nebulous network that nobody can pronounce. Both are valuable: it is a comfort to know there is someone in the City you can kick if things start going wrong in Ulan Bator. But sometimes you prefer the tranquillity of working with the local guru in Tashkent who isn’t then going to try to sell you her firm’s capabilities in Quito (don’t these firms realise I can look Quito up in a book and find out for myself who’s any good?).
In the days before telephones and email, a company would send its agent to an exotic location fully empowered to broker a deal without contacting HQ. Now, technology means we can keep the power at home (we say we are ‘thinking globally’) and move our local pawns around by BlackBerry. But as IT increasingly makes expertise a commodity, will we need local lawyers at all when we can find a commentary to the civil code of Tajikistan on Wikipedia? The answer is, of course, yes. We will still need people to sit in data rooms, people to fill in planning permission applications, and someone to give us their discounted rate in the Hilton. After all, laws may be increasingly global but you don’t want to try to enforce an Anton Piller order by videoconference.
Adam Smith is general counsel at EADS Defence, Munich. This article first appeared in the book Bright Ideas – Insights from Legal Luminaries. See www.brightideasgloballaw.com.
