In-house team leaders share tips on promoting legal practices internally

How do accomplished in-house counsel effectively spread the legal message within their own organisations? Kevin Cheng reports

One of the many core duties of an in-house counsel, besides advising on the legal aspects of all business exchanges or ventures that come to pass, is to promote the best practices of legal, compliance and risk management throughout the whole company.

As concepts go, legal awareness and compliance are hardly novel. In fact, they are embedded in the DNA of modern corporate governance. Nevertheless, many in-house counsel find themselves fighting an uphill battle to be heard beyond the walls of their own legal departments.

Unlike their peers in private practice, who compete with one another for business, in-house counsel wrestle for internal resources against the likes of the product development teams, the finance departments and the IT divisions. It is not uncommon for these other functions to be seen as equally or more important, nor is it rare to encounter an allocator that does not fully appreciate the value of legal work.

These challenges, fortunately, are not insurmountable. For proof, we need to look no further than the stellar records of the winning general counsel and in-house legal teams in the recently announced CBLJ In-house Counsel Awards 2024, as well as the market recognition they received. In this article, we explore the secrets to their success.

Break down barriers

The first step in breaking down the barriers between departments, allowing in-house counsel to be better heard, is to acknowledge their existence, accepting that other units have their own very different expertise and no-less-important priorities.

Iris Kwok, chief compliance officer at the Hong Kong branch of Shanghai Pudong Development Bank, describes legal departments as central support units. “In line with the company’s overall interests, the legal team should maintain communication and interaction with the other departments and strive to break down the walls separating them from others,” she says.

Communication, as ever, is the key, but it is easier said than done. If approached incorrectly, the legal department risks isolation from the rest of the company, being perceived, unfairly as it may be, as the antitheses to business opportunities.

Zhang Xiaoyi, general counsel at MetaSota Network Technology, observes that such an issue can be prominent in emerging industries, where new regulations may result in prominent new products temporarily taken off the shelf, and then relaunched after a period of compliance rectifications.

“New compliance requirements could trigger a negative reaction from the colleagues, as they indeed may add to their burden, or restrict their flexibility,” she explains. “This is why it is so important to fully communicate with the other departments, closely work with them and gain their understanding.”

To rid in-house counsel of the undesirable label of “naysayers”, many point out that a few extra messages should be delivered along with the usual “dos and don’ts”, which can be summarised as:

1. In-house counsel are on the same team with everyone else;
2. Compliance and risk management are not about going through the motions, but ought to be treated as matters of high priority; and
3. It is the responsibility of everyone, not just legal counsel, to uphold the standards.

“Basic awareness of legal risks is something that every member of the company should have,” says Li Jingjue, legal director at Huayi Brothers Media Corporation. “This is not limited to preliminary assessment of the liabilities and damages in case of a breach; instead, everyone should remain conscious to the fact that in all business dealings, everything you do carries legal significance.”

However, to thoroughly cultivate a compliance-driven corporate culture featuring full-fledged systems designed to initiate and monitor legal-related conduct, it may not be enough to convince the salespeople, accountants and IT technicians. Gao Fawei, general counsel at China Power International, points out that in-house counsel must solicit the support of the “critical minority”, referring to the CEOs, the directors and other top decision-makers.

Echoing this view, Stacy Yuan, chief legal officer (APAC & China) at Edrington, argues that to demonstrate the true value of the legal function, “gaining endorsement and advocacy from senior leadership team is the key”.

Michael Yu, North Asia brand protection head at Unilever, opts to “regularly hold meetings, present written reports and conduct training sessions to present illustrative cases to the directors and management, soliciting their opinions”. By doing so, Yu ensures that key decision-makers understand the importance of IP affairs to the company’s operations, making them staunch supporters of the IP team.