Posts Tagged ‘Legaltech’

Speaker Interview: Andrea Brancatelli

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Andrea Brancatelli, MoneyGram International, Senior Legal Counsel

What are the 3 biggest challenges for in-house teams in FS firms today?

The first challenge is an increase in regulations, which in certain areas seem to overlap and under certain circumstances are difficult to apply, due to conflicts with pre-existing legislation or lack of local (secondary) legislation.
The second challenge is political instability (just to recall Brexit, the Turkish coup d’etat and now the Cataluña crisis), which impacts business models and legal structures used by corporations.
Finally, increased difficulty in correctly legally-classifying new legal structures, which arise from the use of new technologies, especially when such legal structures are used in various jurisdictions.

What key steps can legal teams take, to create a higher value proposition for the business and for customers?

Work closer with business teams and customers in order to better understand their needs and therefore propose tailored legal solutions which, on one hand, work case by case for the specific situation, and on the other hand, may be used – with minimum changes – also to regulate future different scenarios.
Translate in practical effective terms – and in advance – the effects of new upcoming legislation and simplify regulatory fulfilments for business and for clients, also through the use of new technologies (e.g. apply e-signatures or simplified binding means where possible).

What hurdles do legal teams face, in terms of implementing and delivering value from new technology solutions? How can these be overcome?

A main hurdle is the lack of laws/regulations/practice with respect to new technologies that the market is implementing, but the regulators have not yet legally classified (e.g. blockchain). Such a hurdle may be overcome by adopting known classifications and standard law principles, and in case of doubt carrying out formal inquiries to the authorities, in order to open a discussion and eventually obtain a sandbox.

How do you view the current level of interaction / collaboration between in-house teams across the FS industry, and how could this develop in the future?

Market associations are often an occasion to interact / collaborate on common legal topics, however, it could be useful to develop more interaction also with the authorities. This could be achieved by increasing the number of consultations and/or roundtables on new laws or modifications to current laws, especially on legal aspects of fintech where there is still great uncertainty

Which pain points for in-house teams most lend themselves to automation, and which pain points will be the most difficult for technology to fix?

Contract drafting (especially for standard agreements), data storage (for corporate secretary) and regulatory fulfilments (for timing of filing with authorities) may surely benefit from automation. It will be more difficult to substitute legal advice or negotiations, where technology may only serve as a support to lawyers driving in person.

Why will you be speaking at Finance Edge’s Next Generation In-House Summit, and what do you hope to get out of the event?

I believe that at all topics related to new technologies in the financial and legal sector require maximum attention and maximum support by all stakeholders, since what we are discussing today will be what we will use and work with for the coming years. As e-signature seemed a revolution only few years ago and now is customary in most business, today we are asked to shape the main legal features of new game changers that will have an important role for the future. I look forward to learning about new approaches that may be eventually be used also within the money transfer business.

Speaker interview: Victor Dorado

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Victor Dorado, Head of Legal, Santander

What are the 3 biggest challenges for in-house teams in FS firms today?

Although it is quite difficult to highlight only 3 challenges, I believe in-house teams have to work quite hard on: (i) providing proper legal support on the business transformation of financial entities, (ii) thinking globally when providing local legal advice, and (iii) looking for more efficient ways to work using available technology.

What key steps can legal teams take, to create a higher value proposition for the business and for customers?

In-house lawyers are a key element in creating business value, and as such, the most essential step we can take is to better understand the business’ needs. By opening up this communication, we can more effectively protect our companies from legal risks.

What hurdles do legal teams face, in terms of implementing and delivering value from new technology solutions? How can these be overcome?

The main hurdle to technology implementation is our own professional experience. We have learnt to carry out our jobs in a specific way: by reading manuals, laws, regulations, etc., all bound in paper. It should not be a major challenge to implement professionally what we have already changed in our personal life, i.e. using technology every day for reading newspapers, watching television, communicating on social media, and many other things. Technology solutions will only enhance the value provided by in-house lawyers, and will allow for greater efficiency by delivering better and more agile legal services.

How do you view the current level of interaction / collaboration between in-house teams across the FS industry, and how could this develop in the future?

In my experience, I see a productive level of interaction between in-house legal teams today, thanks to solutions already implemented. We are now doing things that, just few years ago, were absolutely impossible to do. There are many tools already in place effectively working for the FS industry, making it quite easy to interact and collaborate with other in-house teams.

Which pain points for in-house teams most lend themselves to automation, and which pain points will be the most difficult for technology to fix?

In my view, some tasks, such as taking minutes of a meeting or filing physical legal documentation, are pain points technology is already able to solve. Tasks requiring human understanding and engagement with facts are still too far advanced for technology to automate.

Why will you be speaking at Finance Edge’s Next Generation In-House Summit, and what do you hope to get out of the event?

I will be speaking at the summit because I believe we are living in a remarkable time for in-house lawyers – especially for those who work in the financial industry. No one knows where all these new solutions will take us, or how the industry will evolve in five years, but participating in such an interesting event like this one will allow me to exchange opinions and thoughts with other colleagues that have to face similar challenges.

Speaker interview: Dean Nash

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Dean Nash, Head of Legal & Compliance, Monzo Bank

What are the 3 biggest challenges for in-house teams in FS firms today?

From my perspective it is first the speed of technological change in financial services; this means legal teams needing to know how the technology works, speak the language of their stakeholders (increasingly more likely to be a software developer than a business manager) and operate their way by redefining their engagement to work with agile development teams. This can be a real challenge for legal teams, but when it is done well can be hugely powerful.
Second is the rate of regulatory change in financial services. The regulators have been very active in all areas, from consumer protection to facilitating innovation and market stability. These create far reaching and complicated pieces of regulation that have massive impacts on virtually every financial services firm. The legal team need to scope, interpret, raise resource for, and oversee implementation of these huge projects – at a time when the legal foundation for many of these pieces of regulation is under question by Brexit.
Third is demonstrating value. Every other part of the business is automating as many processes as possible, and with so much regulation and legislation available at the touch of a button, the challenge of demonstrating value can be a real challenge. I think lawyers have a critical and unique role to play in business success, but demonstrating that beyond a vague concept of ‘trusted advisor’ is a real challenge.

What key steps can legal teams take, to create a higher value proposition for the business and for customers?

The key is to look to colleagues around the rest of the organisation and adopt the best practices being utilised across the organisation. I woke very closely with our risk team to ensure that legal risk is managed in a smart and risk-based way. I view legal risk in quite a simple way as coming down to two things: 1. The risk that we can’t enforce our rights as we would like to, or 2. We have breached a law and will be punished one way or another. Lawyers need to really understand – genuinely – what is your company’s risk appetite for these things? Are there other solutions to these risks aside from legal solutions? What are the processes and controls we need in place to manage these risks? How can you ensure these processes work with the business objectives and not against them?

What hurdles do legal teams face, in terms of implementing and delivering value from new technology solutions? How can these be overcome?

To answer this I think you need a really honest appraisal of the technology solutions you currently use and the value you add with that technology. What technology solution improvement would bring the largest value-add to the business for the least disruption? How does the cost / benefit analysis of this stack up against other ‘value-add’ initiatives such as stratifying or functionalising legal services? The simplest and biggest value-add I’ve experienced has come from investment in better communication, collaboration and management tools: basically, better hardware and software.

How do you view the current level of interaction / collaboration between in-house teams across the FS industry, and how could this develop in the future?

I think the industry is doing a great job of collaborating across some of the unique issues that we face as ‘fintechs’. Whether that is as a learning environment to understand early stage fundraising mechanics, or to share concerns about regulatory changes that may increase barriers to entry into financial services. The community is setting our sights around some of the pain points that we all feel, and seeing if we can (disruptively) propose collaborative solutions to common problems. First up – the dreaded NDA. We’d love to agree an industry standard and save everyone a lot of frustrating back and forth at the outset of an exciting business collaboration.

Which pain points for in-house teams most lend themselves to automation, and which pain points will be the most difficult for technology to fix?

I don’t think lawyers are best placed to answer that question to be honest. We are too likely to see the services we provide through the prism of our own training and biases. Legal teams will always have a critical role to play at a high level strategic level. For example, how upcoming regulation shapes business strategy, or which court to have a particular case heard in, or overall risk appetite given business. And doubtlessly lower, more repeatable tasks will be lost to either standardisation or automation. However, to make this happen, legal teams need to absorb developers and engineers into their teams and ask ‘what code could you write to replace the work I do?’

Why will you be speaking at Finance Edge’s Next Generation In-House Summit, and what do you hope to get out of the event?

As a bank that is less than two years old we have the luxury of being able to approach customer problems, business problems and indeed legal problems as an entirely greenfield project. This means digging back to first principles as to why we should design something in a particular way. For example, why should a lawyer review a contract before it is signed? Why should we protect our intellectual property? Why should we have terms and conditions for our products? Getting right back to the why and the first principles of these things has meant the way we approach our designs to these problems and the use of technology in those designs has been a fascinating process for me – and I would like to share this others. I am also keen to learn how other firms are approaching the question of technology in their organisations and see if there is any best practice I can take back to Monzo.

Speaker interview: Michael Harrats

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Michael Harrats, Senior Counsel, Legal & General Investment Management

What are the 3 biggest challenges for in-house teams in FS firms today?

A. Costs! Every non-revenue generating department is under cost pressure at the moment. Demonstrating value as a business partner is the cornerstone of the role of any in-house legal team.
B. Technology/disruption. These two go hand in hand and will be a major challenge for legal teams in FS firms for some time to come. They offer exciting opportunities, but their challenges shouldn’t be underestimated.
C. Brexit. Is always the elephant in the room. Adapting to the post Brexit environment will be the making or breaking of firms, and their legal teams will be key to assisting with Brexit compliant solutions under the new regime.

What key steps can legal teams take, to create a higher value proposition for the business and for customers?

In order to be effective at anything, you need to enjoy it and find it interesting. This certainly applies in the workplace. It might sound obvious, but lawyers need to be engaged and knowledgeable about their business and industry. Knowing the law is not nearly enough.
For me, this is all about taking the time and energy to learn about your business. What products do we sell? How are they perceived in the market? What do our competitors do better/worse than us? What are the key challenges and opportunities in our industry? Most of these won’t be legal related, but we still need to know about them in order to be effective partners to our businesses.
Once your team understand your business and your industry, their specialism (the law) can be applied to this effectively.

What hurdles do legal teams face, in terms of implementing and delivering value from new technology solutions? How can these be overcome?

Lack of knowledge within teams about technology solutions can cause a reluctance to engage with them. This is something we all need to guard against. I see no excuse for this. We are working in one of the most interesting times to be a lawyer. The scope of our roles and the range of tools we have to assist with them are changing at a rapid pace. It’s going to be challenging for us all, but we need to make sure we proactively own our technological development. I would like to see this formalised in the Law Society’s CPD rules, as it’s such a key aspect of our roles.
Pace of change is also a challenge. As soon as we get ourselves up to speed with a technological change, another one seems to appear (and I don’t just mean this year’s new smartphone). The key to mastering this is to take an active interest in technological developments. This won’t come easily to everyone but it’s something we need to work at.

How do you view the current level of interaction / collaboration between in-house teams across the FS industry, and how could this develop in the future?

We work well together. In the asset management industry a legal discussion group of in-house counsel across the main asset managers meets every couple of months to discuss legal, regulatory and market related issues we are all facing. I regularly attend and find the meetings useful. Earlier in the year, LGIM hosted one of these sessions and it was great to meet our peers and have an open discussion with them.
However, there is a danger that we can all become too specialised and only pay attention to our own segment of the market. We need to guard against this.

Which pain points for in-house teams most lend themselves to automation, and which pain points will be the most difficult for technology to fix?

In the short to medium term, I see automation as something which will be used to improve the accuracy of quite repetitive tasks which have previously been undertaken by paralegal/trainee/junior lawyers (e.g. data analysis, contract production and regulatory filings).
In the longer term, the sky really is the limit. I expect innovative solutions to develop which will transfer our way of working which will enable us to assist our businesses further. Some of the solutions we will use later in our careers have not been invented yet. That makes them difficult to anticipate, but offers exciting variation in our working lives.
However, I don’t think this means the ‘end of lawyers’ as often speculated in the press. Automation and AI will likely create increasingly capable solutions, but I’m sceptical whether we will see sentient (thinking) machines which render us surplus to requirements.

Why will you be speaking at Finance Edge’s Next Generation In-House Summit, and what do you hope to get out of the event?

We are operating in one of the most fluid times in the FS industry since the early 80’s. This presents us with many challenges, and it can be easy to become siloed in your own firm and miss the wood from the trees. I think it’s important to discuss ideas and approaches about the challenges our industry is facing with peers. This summit should prove a good opportunity to do so.

Speaker interview: Dr Solomon Osagie

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Dr Solomon Osagie, Chief Legal Counsel at TSYS International

What are the 3 biggest challenges for in-house teams in FS firms today?

In no particular order, I suspect that most General Counsel will consider that a constantly evolving regulatory environment poses a challenge. Whether one considers BAU or M&A activity, there are pressures to keep businesses compliant. For UK businesses, uncertainty about the regulatory impact of Brexit and how the process will evolve adds to the challenge. Many lawyers will also be mindful of financial pressures. Some of us have advocated over the years for legal teams to be more integrated into the business, but this brings with it the reality that legal teams have to operate under financial pressure and deliver services that are not necessarily revenue generating. One last challenge will be the implementation of the new data protection legislation, the GDPR.

What key steps can legal teams take to create a higher value proposition?

Early engagement with product teams, which helps lawyers to understand the value proposition better. It is unfortunate when transactional lawyers are unaware of the technical specifications of a solution, and they offer legal solutions which impede rather than facilitate the objectives. I have also suggested that lawyers consider taking on non-traditional roles like CSR to help push boundaries. They can demonstrate value in non-monetary ways. Thirdly, we should consider how to offer advice that is practical and innovative with an eye on the commercial objective.

What main hurdles do legal teams face, in terms of implementing and delivering value from new technology solutions? How can these be overcome?

Whilst new technology solutions can offer returns for a company, the risk exposure is greatly increased. This opportunity must be balanced against risks, and legal teams need to be forward in explaining this. Thereafter risk should be spread/mitigated where possible.
If the business is buying or creating new technology, the legal team will need to ensure the business has all the required rights to use the technology effectively. What IP rights are involved, does the business own them, who owns the output? Is the new technology owned under a license? Is the license broad enough to cover all activities that the business has in mind? We should also consider that there are adequate liability caps to reflect actual risk rather than contract value. Penalties for breaches of data protection law, for example, can far outweigh contract consideration.
Early engagement and a clear understanding of the business’ objectives is key. Understanding the product and the implications for any particular asset contained therein, e.g. data, IP etc., and how the product will be used by customers.

How do you view the current level of collaboration between in-house teams across the FS industry, and how could this develop in the future?

The FS industry is diverse, with many lawyers working in niche areas. There are some areas of commonality (such as implementation of new laws) but often the drivers and risks are different from business to business. The dominant position of the banks within the sector does mean that to an extent a bank’s approach to regulation and risk will flow down through supply chains. Collaboration via a cross-pollination of ideas around regulatory compliance, risk mitigation and alternative structuring would be helpful.

Which pain points for in-house teams most lend themselves to automation, and which pain points will be the most difficult for technology to fix?

Automation could help with standard agreements such as NDAs. The issue with automation comes in the more complex contracts – this may not be just because the deal is of a high value, but because of the commercial construct and the products involved, where automation would not pick up on the nuances of such deals. This is where skilled negotiators with expert knowledge of their industry and related products will save time and help all parties to reduce risk. Automation/machine learning is useful for calculating some elements of remedy – e.g. SLAs, possibly liability caps, change control procedures. Similarly it may be possible to cover off some standard form agreements and translations. However, negotiations are ultimately a human interaction, which require give and take on issues that will not follow predetermined patterns.

Why will you be speaking at Finance Edge’s Next Generation In-House Summit, and what do you hope to get out of the event?

The summit will be a great opportunity for members of in-house legal teams within the FS sector to come together and discuss current issues, and form ideas that can help our industry move forward during a very complex regulatory and political period.

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“First of all, thank you ever so much for inviting me to participate as a speaker and congratulations for the event!! This is a massive industry shift and this event will help to share views and connect with other peers in this new OpenBanking environment.”

Liberbank

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