Beyond fighting fires

Tim Wong, group general counsel Asia-Pacific, of George Weston Foods, says it's easy for corporate lawyers to lose themselves in the labyrinth of legal files they face everyday. Instead, lawyers should look at how they can prevent legal issues from becoming problems.

When ALB spoke with Tim Wong, he had just returned from a trip to China. He visited the businesses of Associated British Foods (ABF), the parent company of George Weston Foods (GWF), in Beijing, Harbin and Shanghai and gave training courses on antitrust law to more than 50 managers.

Training courses form one tool in Wong's kit that help him avert legal problems. He is not the type to sit at a desk and wait for files to pile up; Wong sees his role as keeping one step ahead of potential problems. "It's too easy in any in-house department to be burdened with fighting fires," he says.

However, he acknowledges that his approach does mean that large chunks of legal work need to be outsourced to law firms. "There is a lot of work that you could do," he says. "We have 9,000 employees just in Australia and New Zealand - that's George Weston Foods. Then you need to add on all the other ABF businesses on top of that. If you don't draw the line somewhere and focus on pro-active involvement, you could end up being inundated with work. You've got to get that balance right. That's what I and my team are constantly focussing on: where can we add value?"

Wong says the search for improvement is a continuous process. "You can't just rest your laurels," he says. "You need to keep reinventing yourself. That's why you look for people who have worked in other legal departments and you bring across the benefits from their experiences. You can't assume that what you do is best practice. We certainly hope that and aspire to that, but we're always open to new ideas and look for improvements."

Talk to each other

A recent report by corporate lawyers' associations, ACLA and CLANZ, made it painfully clear that many in-house legal teams have problems explaining their worth to their management teams. Partly, this can be explained by a lack of communication - many general counsel don't report directly to the company's CEO.

Wong says the importance of good communication between the legal department and the executive team cannot be stressed enough. As group general counsel of GWF, he reports to Geoff Star, CEO of the company, but he is also a member of the executive team and this helps him to make sure he can provide continuous updates. "It's very important to have that dialogue and explain to them how we add value, how we try to keep the costs down and how we try to partner with the businesses, rather than just being a service provider."

Wong translates these discussions into tangible objectives for his team. One of the targets is to stay within budget. "Obviously cost is always an issue in any organisation. You can see in the marketplace that there is much pressure on pricing and we need to make sure we offer value-added, efficient, cost-effective legal services. I have a budget and I certainly have a major input in the budget, but I still need to make sure I meet those budgets."

But Wong also stresses that the budget needs to reflect reality and, therefore, needs to be flexible. "[The budget] recognises that I have a core expenditure and that there will be one-off expenditures, such as major acquisitions and major litigation." He explains that, apart from a budget for the group legal team, the individual businesses have budgets for their legal expenditure as well. If a matter is beneficial solely to the business, then it's charged to the business's budget, but if a matter is beneficial to the whole group, then it is charged to the group legal budget.

Local knowledge

Besides the direct reporting line to GWF's chief executive, Wong also reports to the parent company's group general counsel in London. ABF has 12 businesses in Asia, of which six are located in China. Wong and his Sydney-based team are responsible for the legal affairs of all of these divisions and he says the global general counsel takes a keen interest in the Asian operations.

The team's role in Asia is mainly to support the local managers. "We help out on acquisitions, disposals, joint ventures - major corporate work. We don't get involved in the local issues, the smaller day-to-day transactions or employment disputes, because we are not local lawyers. We can't practice local law. We use local lawyers and we have empowered the local managers to do that."

In China, for example, Wong relies partly on the relationships the business managers have with local lawyers. "From province to province and from city to city, they would use different law firms." These lawyers tend to be professionals in small law firms. "We have considered using some of the bigger local Chinese firms, such as King & Wood, but we haven't felt the need at this stage," he says.

Australian panel

In Australia, Wong outsources most of his legal work to Freehills, with Martin Shakinovsky being the company's premier relationship partner. He also uses Allens Arthur Robinson and Clayton Utz on a regular basis. "For specialist matters, we use smaller law firms, such as Australian Business Lawyers," he says.

The relationship with Freehills is inherited, but Wong says that since he came on board he has sent more work their way, especially IP matters. Partner Kristine Stammer is his first point of contact on trademark issues. "Kristine is very commercial and understands the bigger picture. You get some lawyers in private practice, who think that IP is the centre of the universe, but Kristine and her team are very commercially orientated and understand that IP is a means to an end."

Freehills has an office in Singapore, but Wong says he doesn't make use it for his Asia-based work. "Allens do that," he says. "We mainly use Allens in Shanghai, and we use them across Australia where we have conflict [when using Freehills]. They have done our competition work for a long time." Wong is particularly impressed with Wendy Peter, partner in the Melbourne office. "It's the individuals we like to deal with, not just the firm," he says.

Wong says he looks for four things in a law firm: value for money, turnaround time, quality of service and commerciality. "Cost is a big issue; we certainly want to get a fee-estimate [before we instruct a law firm]. We have a no-surprise policy." But he says he also appreciates firms that go out of their way to increase the quality of their service and offer training, newsletters and the opportunity to 'chat' about matters without being charged for every six minutes in a phone call.

Fertile ground

Since he joined GWF, Wong has doubled the size of the in-house team. It now counts five lawyers in total. Apart from Wong the team has two corporate and commercial specialists, one IP lawyer and one trade practices specialist. "In the next two years, the team will probably stay the size it is. In my four and a half years with GWF, I have doubled the size of the team and I don't see that continuing at this stage. [Over] the next three years, we will focus on increasing the value of the team that we have in place."

ABF has over 30 lawyers around the world and the legal team in London and Sydney form two sides of a legal triangle that is completed by a team in Memphis, Tennesee. Wong is passionate about facilitating the interaction between the teams and says there is much they can learn from each other.

"Cross-fertilisation is important to us. One of our corporate lawyers has gone on secondment to our parent company in the UK and this has helped to increase the level of engagement between the UK and Australian legal teams. [When he returns] there are certain things that they have done in London that we will adopt and there are certain things that they will probably adopt in London. It will be a tremendous experience for him and it's very pleasing to see that he's recognised."