[ad_1]
When Australia’s royal commission into the banking and financial services industry handed down its findings in 2019, the effect was devastating. The country’s leading banks — which had been so robust in withstanding the global financial crisis a decade before — had ripped off customers, broken the rules and lied to regulators, it concluded.
Chief executives stood down, household names were tarnished, and A$6bn of repayments were pledged to customers. The investigation revealed unscrupulous behaviour and multiple compliance breaches related to money laundering rules. Some banks had even been charging premium fees to thousands of people who were deceased.
But the royal commission also exposed the inability of even big financial institutions to cope with requests relating to their huge caches of documents. Banks struggled to prepare their defences because they had a poor idea of what was in the data they were handing over.
Since then, new inquiries into care for the elderly, disability services and the casino sector have also highlighted a need for sophisticated document management and compliance testing in other industry sectors. And, as Richard Harris, partner at law firm Gilbert + Tobin, points out, politicians in Australia have taken to using royal commissions — in-depth probes ordered by the government — as a “weapon of choice” for taking businesses to task.
That leaves clients increasingly likely to face calls for enormous data sets at short notice, without argument — giving Australian law firms an opportunity to offer new services.
“Hell [for companies] is that they don’t understand their own information and [don’t] understand that risk,” says Harris. “These are existential risks,” he stresses. Even if companies think they are not under threat, they will be exposed to much higher costs. In short, the royal commission was a “watershed” for regulation in Australia, Harris argues.
Gilbert + Tobin is one of a number of law firms that worked with banks during the royal commission and acted quickly on developing new services. It launched GTDocs, a document management tool, that has been used for 50 or so projects and generated around A$12mn in billings for the firm in 2021.
Caryn Sandler, partner at Gilbert + Tobin, leads the innovation team, which has grown to more than 20 people in the past two years as it increases its expertise in informatics and predictive analytics.
The firm has also built a “surge capability”, so it can quickly expand a team when a client needs urgent help in preparing data. Sandler says that ability became an essential tool for financial services companies as the banking royal commission triggered class actions against the banks.
Getting on top of data quickly could mean the difference between being prosecuted or not, says Felicity Healy, partner and commercial litigation specialist at law firm Corrs Chambers Westgarth.
Like Harris, she says the Australian regulators’ approach is becoming more proactive. That was evident, she explains, in recent crackdowns by the consumer watchdog, the Australian Competition and Consumer Commission, on misleading “greenwashing” claims by companies, and in action taken against Macquarie Bank, over alleged control failings, by the Australian Securities and Investments Commission.
Corrs has developed a hosting service whereby National Australia Bank can access all relevant documents in a single location. Corrs trains the in-house lawyers to use the system themselves.
“Corrs is a legal firm — we want to do legal things,” Healy says. “We need to give financial services companies control over their documents.”
Other law firms have taken a different tack still. Ashurst set up a consulting arm in the aftermath of the banking royal commission that has grown from just one consultant to more than 110. Ashurst Consulting has invested in building a risk practice so it can sell its clients an integrated service covering legal and compliance.
Jamie Ng, global head of Ashurst Consulting and head of its finance division, says the reporting burden has increased, noting a “significant increase in breach reporting” by banks and financial services companies. This means there is strong demand for an integrated offer, he suggests, as “it’s one thing to get the advice and it’s another to operationalise it.”
He highlights the triage system whereby Ashurst Advance, a division of the firm offering services such as legal operations consulting and managed legal services, can help clients identify what is important in their documents. For financial services businesses addressing the 76 recommendations handed down as a result of the banking royal commission, it is a useful tool, he says.
As for the law firms, they are looking to export the tech and data tools they have honed for helping clients under pressure from regulators.
Gilbert + Tobin’s Harris argues that too many law firms outside Australia’s competitive legal market have been less innovative in this area “largely because there is profit to be made continuing in the old way” — that is, with crowds of lawyers and other staff working on documents.
The speed and efficiency of the new data handling tools emanating from Australia could soon change that, Harris predicts: “Clients will become more savvy.”
Case studies
-
Digital legal practice
-
New solutions
Digital legal practice
Case studies in best practice. Researched and compiled by RSGI. “Winner” indicates the organisation won an FT Innovative Lawyers 2022 award; other organisations are listed alphabetically.
WINNER: Nishimura & Asahi
While still practising law at the firm, associate Hiroshi Watanabe launched an independent start-up called BoostDraft, an artificial intelligence (AI) drafting tool for Japanese legal documents. The tool helps the firm’s lawyers by automating tasks such as proofreading, which frees up their time. It has also been adopted by other Japanese law firms.
Algo Legal
Collaborating with Singapore-based fintech and legal tech company Qapita, the firm has developed a service to manage employee stock ownership plans for start-ups in India and Singapore. The firm advises on the legal, tax and regulatory implications associated with the plans and the service is priced at an affordable rate for start-ups.
Allen & Overy
In response to an imminent change to passporting regulations for foreign financial institutions operating in Australia, the firm developed a free, web-based tool to help these organisations assess the potential impact on their business. The firm says the tool has brought new work to the firm.
Clayton Utz
The Australian law firm has launched a tool called AcCUrate, which identifies where businesses have overpaid or underpaid their employees. The platform is customised to each client and uses data visualisation to find any discrepancies between agreements and actual payments. The firm says the tool helped identify more than A$10mn in employee entitlement issues in 2021.
Hogan Lovells
The firm automated the process of renewing 30,000 trademarks for its client, a leading car manufacturer, using UiPath software. The bots can be tweaked to manage the same process for other clients and adapted to other intellectual property work or administrative tasks, such as invoice management. The firm estimates the bots will save 3,000 hours over three years for the carmaker.
Inkling Legal Design
The legal design consultancy and law firm developed a digital drafting assistant for lawyers called Gloss, working in collaboration with Writer, a writing assistance tool. Gloss, which is used on all projects internally, uses AI to redraft contracts and other documents into simpler language, and also checks for consistency of style and use of inclusive language.
The tool is used externally with clients, including bank HSBC and health insurance provider Medibank. It has allowed Inkling to increase its revenues significantly without increasing headcount.
King & Wood Mallesons
An increasingly high volume of patent applications spurred the firm to develop a tool that enables clients to file for patents without having to instruct a lawyer.
The tool takes clients step by step through the process of applying for a patent. The product was developed for the Chinese market and, in just six months, it has been used by more than 1,300 clients on more than 11,000 applications.
LNT & Partners
The Vietnamese law firm launched Vietnam Law Insight, which allows clients to track the progress of deals in real time and provides tailored legal forms and adaptable contract templates written in plain English for in-house counsel. Thirty per cent of the firm’s deals are currently being tracked by clients, which report that the templates are more user-friendly than similar offerings elsewhere.
WongPartnership
The Singaporean firm has implemented an AI-powered knowledge management platform that organises specialist information and resources across the firm in a database, which lawyers can access via a search function.
The platform has made it easier for lawyers to collaborate and share knowledge with each other, speeding up work across the firm.
Yulchon
The firm developed a tool to help clients monitor trademark databases for potential infringement.
The tool scans South Korean trademark databases and sends clients automated email alerts with its findings. The solution enables more regular searches, involving less effort by the firm. It also means clients can respond to potentially infringing marks more quickly.
New solutions
Case studies in best practice. Researched and compiled by RSGI. “Winner” indicates the organisation won an FT Innovative Lawyers 2022 award; other organisations are listed alphabetically.
WINNER: Ashurst
Following the 2019 royal commission report into misconduct in Australian banks, which sparked a regulatory shake-up after years of scandal, the firm set up a risk advisory arm to meet increased client demand for advice. With more than 100 professionals, Ashurst Consulting is one of the biggest offerings of its kind from a law firm in the Asia-Pacific region. Through a collaboration with engineering and advisory company Aurecon, the firm is able to draw on a wider range of expertise to help clients with a broad range of business problems.
Anand and Anand
The Indian firm has convinced the Delhi High Court to set time limits for hearing arguments, so that these do not overrun. Fixed times for hearings are now an official part of the court’s rules. The change has enabled the courts to deal with a higher volume of cases, particularly because they can dispose of complex cases involving multiple parties faster.
Corrs Chambers Westgarth
To help National Australia Bank (NAB) respond faster to queries from regulators, the Australian law firm developed a solution that combines ediscovery and knowledge management. Documents from the bank are hosted on Corrs’ secure cloud environment and NAB can grant access to other law firms it works with, minimising duplication. Corrs has trained the in-house team at NAB to manage the system themselves, which gives the bank greater control over the process.
DLA Piper
The firm launched a business advisory unit that advises on all aspects of the mergers and acquisitions lifecycle to manage post-deal integration, which can be complex. Post-deal work would usually be handled by a separate consulting firm, but clients value the fact that the law firm is already familiar with the deal, which speeds up the process of establishing governance and reporting to the board once the deal has closed.
Gilbert + Tobin
In order to meet temporary staffing requirements faster and have greater certainty over the quality of candidates, the firm has launched its own platform on which people looking for temporary paralegal work can register. The tool allows the firm to find paralegals with specific skills, such as foreign languages, more easily and has become an effective way to attract early career hires. All temporary staffing needs are met through the platform.
Herbert Smith Freehills
The firm has set up a cloud platform to assist one of Australia’s leading banks in its response to regulatory notices. The system handles more than 40mn documents, including those worked on by other law firms. Coding of data to standardise information such as privilege is also shared between firms, meaning the bank’s responses to the regulators are more consistent. Having several firms collaborate on a single platform minimises duplication of work, which, over time, will result in big savings for the client.
Kim & Chang
The firm has a team that specialises in helping clients identify viable targets for mergers and acquisitions, using intellectual property (IP) data from multiple sources, including the firm’s proprietary intelligence.
The team advises on risks associated with the potential target’s IP, such as its competitiveness.
Norton Rose Fulbright
The firm’s legal operations consulting business worked with Japan’s biggest power generator, Jera, to design a system to help the company’s legal team manage and allocate work. The firm created a tool to highlight areas of expertise within the legal team. The tool also uses data to identify areas of demand for different legal services across the business.
Rajah & Tann
The firm hosts the Asia-Pacific branch of the Future of Privacy Forum (FPF), a think-tank in Singapore, providing the organisation with operational resource support, such as IT infrastructure. The firm has also appointed Clarisse Girot, global data protection expert and director of FPF’s Asia-Pacific office in Singapore, as adviser to its technology, media and telecommunications team. The arrangement allows FPF to expand in the region and the firm to develop its reputation as a thought leader.
RHT Law Asia
The Singaporean firm launched the AlDigi Group — a separate business offering additional services alongside legal advice, such as investor relations, capital markets advice, tax consulting and tokenisation. The new business was valued at S$45mn by a potential buyer.
[ad_2]
Source link