Good evening. I am delighted to be here this evening.
Your conference theme of “One Function” is apt in light of the evolving role of in-house counsel today and the increasingly global world we live in – in-house counsel can no longer work in silos; they need to work seamlessly with business partners and with each other.
The Evolving Role of In-House Counsel
In the book “Courageous Counsel”, the authors – a general counsel and a law firm partner – described how the role of in-house counsel has evolved from a corporate gatekeeper to a corporate leader with a critical voice in the executive suite and the boardroom. In fact, a 2012 KPMG survey of 320 general counsel found that 46% of general counsel in the US sat on the executive committee or main Board of their companies.
In-house counsel are also transitioning to a broader role. They are more involved in matters that do not strictly pertain to legal issues, such as risk, compliance, finance, regulation, HR, and business issues.
As companies look to curb the use of law firms given the pressure to reduce costs, in-house counsel are tackling increasingly complex matters that were once the domain of external law firms.
There is no doubt that in-house counsel are rising in importance.
Shift in Business Focus to Asia-Pacific
- In-house counsel support business. More companies are shifting their focus to Asia-Pacific, driven by the business opportunities in this part of the world.
- Asia-Pacific was the top destination for foreign direct investments in 2013, accounting for almost a third of global inflows. It is also set to grow further with the formation of the ASEAN Economic Community and the conclusion of the Trans-Pacific Partnership.
- The outlook for the energy sector in Asia-Pacific also looks as promising.
- Asia-Pacific’s primary energy demand was projected to increase at 2.1% per year from 2010 to 2035, faster than the projected global growth rate of 1.5% per year during the same period.
- To meet energy demand, Asia-Pacific will need a cumulative investment of about US$11.7 trillion in the energy sector from 2010- 2035 - from upstream energy extraction and production, to midstream energy transformation and transportation, to downstream energy distribution.
As business and operations shift to Asia-Pacific, legal and regulatory issues are bound to arise. Managing them may be made more challenging by the diverse legal systems and cultures in the region.
Companies and their in-house counsel have to grapple with extraterritorial laws, multiple jeopardy issues and not to mention new laws that are being enacted. For example, a number of ASEAN countries have recently enacted or are planning to enact new data privacy laws.
There are also issues specific to oil and gas companies. For example, the Dodd-Frank Act requires all oil, gas and mining companies to disclose how much they pay governments for exploration, extraction or other activities. However, such disclosures may be illegal in certain other countries.
So in-house counsel play a critical role in helping their companies navigate these issues.
Singapore’s Role in Asia-Pacific
What is Singapore’s role in all of this?
Singapore is home to many multinational companies, which use Singapore as their international or regional headquarters. These companies are attracted by factors such as our pro-business environment and high liveability standards. Chevron is one such example – you established your Asia-Pacific headquarters for upstream operations here about two years ago.
Many of these multinational companies also have in-house counsel based in Singapore with corresponding international or regional responsibilities
Singapore’s Initiatives to Support the In-House Counsel in Singapore
The Singapore government is committed to ensuring that the legal needs of companies can be adequately supported from Singapore, especially as business dealings become increasingly cross-border and complex in nature.
Singapore is an ideal location for companies and in-house counsel to manage their legal issues from for various reasons.
- First, our strong belief in the rule of law.
- There is a high degree of trust in Singapore’s legal system and rule of law.
- Our legal and regulatory framework was ranked second in the world by the International Institute for Management Development in 2013.
- Singapore was also ranked second in the world in intellectual property protection by the World Economic Forum.
- Second, we have a strong slate of international and local law firms to support the companies.
- We are home to about 40 of the world’s top 100 law firms by revenue.
- Our top five Singapore law firms are the largest in Southeast Asia. They also have strong regional practices.
- Third, we have a deep pool of legal talent to draw from.
- We have two law schools in the National University of Singapore (NUS) and the Singapore Management University (SMU). NUS Law School has been ranked amongst the top three law schools in Asia for the past three years.
- There is now a strong community of almost 6,000 practising lawyers on top of the estimated 1,700 plus in-house counsel.
- We also made it more attractive for companies to base their in-house counsel in Singapore by codifying legal professional privilege for in-house counsel in 2012.
- Fourth, we have a complete suite of dispute resolution services to help companies resolve their disputes.
- We have enjoyed some success in international arbitration as a result of a deliberate approach in developing the sector:
- We have a completely open regime for arbitration. Parties engaging in arbitration in Singapore have the freedom to engage lawyers of any nationality and use any governing law.
- Our Courts have been supportive and pro-arbitration, and consistently supported the finality of awards from arbitrations with minimal intervention, except within very clearly defined, internationally accepted rubric.
- We are a signatory to the New York Convention and our International Arbitration Act is modelled after the UNCITRAL Model Law.
- We set up Maxwell Chambers, the world’s first integrated dispute resolution complex housing international arbitral institutions.
- We are now looking to replicate this success in international commercial litigation and mediation services through setting up the Singapore International Commercial Court (SICC) and the Singapore International Mediation Centre (SIMC).
- The SICC will be an international court with specialist jurists hearing international commercial disputes. It will hear disputes governed by foreign law as well. Foreign lawyers may be allowed to appear and plead before the SICC. We are working to launch the SICC by early next year.
- The SIMC was launched last week. It will offer world-class commercial mediation services as an important complement to arbitration and litigation. Mediation provides a platform for softer approaches to dispute resolution which can aid in developing win-win solutions and the preservation of relationships.
Improving and Developing Through Collaborations with Companies
- But we also want to continue improving. We are keen to work with individual companies, such as Chevron, to extend and deepen their legal capabilities in Singapore, so that they can better support the businesses in this part of the world. This may include:
- Building specialised legal expertise in areas such as antitrust and competition, regulatory and compliance, mergers and acquisitions, and intellectual property; and
- Developing innovative solutions to tackle legal issues more efficiently, for example fraud detection using data analytics.
We also see in-house counsel having a role to play in raising the level of legal services in Singapore so that we can truly grow as a regional legal services provider. This can be as simple as articulating your needs as a consumer of legal services and highlighting the gaps you see. We at MinLaw will be happy to receive your feedback.
As the theme of this conference suggests, in-house counsel from different parts of the business need to work closely with one another so that they can function seamlessly. This close partnership should not be just limited to the legal departments within the company, but also to your internal stakeholders and external partners. No in-house counsel can function alone.
- We hope to see you achieve your vision of “One Function” and we hope that Singapore will be part of that journey. I wish you all the very best for that. Thank you.