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Fighting Fires

Beginning in June 2019 with a series of uncontrolled blazes, Australia’s bushfire season – since dubbed the ‘Black Summer’ – has spiralled into one of the worst on record in the country, causing widespread devastation to communities and wildlife.

By the end of January 2020, the fires had claimed more than 30 lives, burned through millions of acres of bush, forest and parks, and led to the deaths of an estimated one billion animals – with fears that some endangered species have been driven to extinction by the disaster. Over 2,000 homes have been destroyed and countless communities evacuated by the unprecedented ferocity of the bushfires. Smoke from the flames has caused disruption to major metropolitan areas such as Canberra, Sydney and Melbourne, with the air quality in Australian cities sinking to among the lowest in the world at various points throughout the crisis.

The crisis has impacted all sectors, as businesses, government organisations and charities were called into action to battle the flames – either on the front lines, or behind the scenes. With the legal function playing an ever-increasing role in the management of crises of all kinds, in-house lawyers throughout Australia are diligently working to play their part in the management and mitigation of the unfolding disaster.

Feeling the heat

The scale of wreckage caused by the fast-moving Australian bushfires has been catastrophic, and has placed a lot of pressure upon organisations involved in the relief effort. But, for general counsel on the ground, their response to the tragedy has been similar to that of any crisis.

‘The bushfires are no different to any other crisis that in-house lawyers can face. I have worked in other industries throughout my career and this is no different. Crisis is something that is faced by all in-house lawyers at some point in their careers,’ says Tara Eaton, head of legal and policy at Australian Red Cross.

Australian Red Cross is a humanitarian and community services charity that has raised over AU$127m towards the bushfire disaster relief effort.

‘At the Red Cross, we do have an existing framework within the team and we build on that during times of crisis. For example, the team is set up to have a lawyer dedicated to a particular department – with that, we are able to build stronger relationships,’ says Eaton.

‘Therefore, in a crisis, different departments within our organisation immediately think of legal. They get you involved in the crisis management team from the beginning and, because of that, you are abreast of issues as they develop, you are part of the team that sits on daily, or even sometimes multiple times a day, update calls.’

The pressure to deliver timely, accurate and efficient legal advice is well-covered ground for in-house counsel, but in times of crisis, where life is at stake, this imperative only intensifies, explains Eaton.

‘One of the most challenging things in a crisis is being able to provide ad hoc legal advice. Not knowing all the information, but still having to make a call on things because the issues are moving so quickly, is difficult. One of the greatest skills for in-house counsel everywhere is the ability to trust your gut,’ she says.

‘It is absolutely necessary to provide ad hoc legal advice in response to a crisis situation.’

‘This is a necessary skill in a crisis. Having knowledge of your industry, business and the requirements to make decisions is essential to providing the best guidance you can at any particular time. So we have been doing that as a team, as the bushfires have been developing. We have been issuing daily emails to support our colleagues, saying here is today’s legal guidance, and we build on that as the team faces additional questions.’

‘During a crisis, general counsel need to show compassion and understanding for members of their organisation, while maintaining a clear head and providing objective legal advice under pressure,’ agrees Katrina Bullock, general counsel at Greenpeace Australia.

‘This requires resilience, a strong support network and self-care.’

Also feeling the pressure to provide speedy legal advice during this crisis is Sarah Donald, general counsel of Sunshine Coast Council. The Sunshine Coast is just one of many local councils across the eastern seaboard of Australia that have felt the devastating effects of the bushfires.

‘The recent bushfires presented unprecedented challenge to our community, with the immediate evacuation and displacement of thousands of people,’ says Donald.

‘It is absolutely necessary to provide ad hoc legal advice in response to a crisis situation.’

Sow the seeds

With times of crisis adding more layers of pressure to lawyers already grappling with the demands of the in-house job, steps taken pre-crisis can go a long way to ensuring the response to disaster situations is efficient and as stress-free as possible. Having systems in place aimed at mitigating risk during times of crisis is essential to providing effective legal advice.

‘Bushfires are not uncommon in Australia,’ says Donald.

‘As a result, significant systems are in place to manage these events. In Queensland, these are managed pursuant to the Queensland Disaster Management Act 2003. This Act outlines the principles of disaster management in Queensland.’

Provisions under the Act provide a legal framework for local councils during times of crisis, covering the disaster response capabilities required of local government and the training required of those involved in disaster management.

‘Local government is responsible for managing disaster events in our local areas, and this is done through our Local Disaster Management Group (LDMG). Our LDMG is coordinated by the Sunshine Coast Council, and membership is made up of liaisons from all emergency agencies (police, fire, ambulance, State Emergency Services), as well as community service providers (both government and non-government) and media representatives,’ outlines Donald.

‘The Council and in particular our disaster management team, works very hard to ensure we have excellent relationships with our emergency services partners, so we are able to have seamless operations when we are required to activate our disaster management plans and coordination centre in response to events affecting our region. These relationships were essential when we were managing the recent bushfires in our region.’

The importance of cultivating relationships extends to external counsel to whom the legal team can turn when crises demand specialised legal advice, fast.

‘You may be called on to give urgent advice on specialist areas that are not necessarily within your own expertise – then it is good to have good relationships with advisers that you can call on quickly,’ explains Astrid Heward, general counsel and general manager at the Bureau of Meteorology in Australia.

Bigger Picture

The crisis highlights the need for organisations and their in-house teams to be appropriately prepared pre-crisis, and efficient in the provision of advice mid-crisis. But, for some organisations, their work will stretch far into the future, beyond the crisis of the day.

‘We have a professional duty to ensure that our response is not just limited to the immediate effects of these fires, but rather focused on the root cause,’ explains Katrina Bullock, general counsel at Greenpeace Australia.

‘Climate change is driving catastrophic bushfires. This is a coal-fired crisis: coal is driving both the bushfire crisis, and the Australian federal government’s inaction on climate. We have ignited the shared social and economic power of Australians through our climate petition, which demands that the federal government respond to the bushfires by declaring a climate emergency and taking action to mitigate climate change. Over 81,000 people have signed to date. Across the organisation, we continue our multifaceted work to support renewable energy investments and dismantle the systems that support the climate crisis; to hold those responsible for contributing to climate change accountable – in the streets, at the ballot boxes, in financial markets and in the courts.’

She adds: ‘It is becoming increasingly important to embrace new, time-saving technologies and ways of working that empower our crew to make well-informed, timely decisions. I think we will also see increasing climate-related litigation against Australian directors who have acted negligently in ignoring climate risks, and a surge in activist investors who boycott fossil fuels. This will generate some interesting and complex legal work in the years ahead.’

‘For example, I’m no expert in industrial relations, so I have a couple of advisers I trust that I can call to bounce things off quickly.’

However, when time is of the essence, it is ultimately up to in-house legal teams to make initial assessments and provide preliminary legal advice in times of crisis.

‘Our external firms have been very supportive, but in a crisis you do not have a lot of time to go out to external counsel,’ says Eaton.

‘I have always described the role of in-house counsel as being a GP: we diagnose the head colds, the broken ankles, and then decide if we need to go out and see an ear, nose and throat surgeon. But we as in-house counsel are doing the first diagnosis of what is wrong.’

In the end, whether seeking guidance from external advisers or relying on internal resources, general counsel depend upon on the relationships they have developed.

‘To me, it boils down to relationships – we as lawyers work really closely with our colleagues to understand the issues that arise, and then work with them to find solutions,’ says Eaton.

‘It is important for in-house counsel to not become the department of “no” – of course we have to be that in this role sometimes – but particularly pointed in a crisis are the relationships you have built that enable you to have a seat at the table. Your practical guidance can be implemented very easily in a crisis; because you do not have a lot of time, you do not have the ability to come up with new policies and procedures – you just have time to give short, sharp guidance to help.’

Where there’s smoke there’s fire

Managing the legal efforts from the skies is Heward at the Bureau of Meteorology (BOM), an executive agency within the Australian government responsible for compiling weather forecasts, warnings and observations and delivering them to the Australian public.

‘The Bureau’s mission is “to provide trusted, reliable and responsive weather, water, climate, and ocean services for Australia – all day, every day”, and Bureau staff have a very strong sense of public service,’ explains Heward.

‘The majority of the work that my team does to support our operational groups during the extreme weather season in fact happens when Australia is not in its “severe weather season”.’

Australia’s severe weather season traditionally occurs in spring and summer, and features weather events such as drought, severe thunderstorms, flooding, tropical cyclones and bushfires.

‘A key factor in the success of the emergency service response to the bushfire crisis is the collaboration and co-ordination between the various agencies that are involved in the response effort. The legal team supports this with MoUs [Memorandum of Understanding]/agreements that facilitate the Bureau’s meteorologists to be embedded in the emergency services as required in extreme weather events.’

‘It is important for in-house counsel to not become the department of “no”.’

Nevertheless, as with many crises, planning can only take you so far. Severe weather is, by its nature, extremely volatile. Emergency situations are inevitable. When adversities such as the devastating Australian bushfires occur, general counsel are relied upon to provide fast, accurate and essential legal advice.

‘If I am called upon to give urgent advice, I try to keep an eye on the bigger picture, and the risk levels, to understand how the advice needs to be prepared and presented. It’s obviously important to give the right answer, but “right and done” is better than “perfect”,’ outlines Heward.

‘One of the most challenging issues that arose in my role over the last couple of months related to the Meteorological Authority Office. Under the Civil Aviation Regulations, the Bureau’s CEO is able to authorise equipment to be used to provide reports for use in forecasts for the purposes of civil aviation.’

Thick plumes of smoke that wafted into cities had an adverse effect on the visibility of crucial airport services. Providing visibility reports are essential. However, equipment used to provide such reports was not always regulatory compliant to measure smoke particles.

‘Existing runway visual range (RVR) equipment at certain airports in Australia was already authorised for the purposes of providing reports in relation to fog/mist, but not for other types of lithometeor particles (such as smoke),’ says Heward.

‘Due to the serious smoke haze experienced at these airports, the Met Authority team had to work urgently to manage the complex regulatory and technical matters that allowed for the RVR equipment to also be authorised for smoke.’

Paved with good intentions

On the ground, in-house counsel are supporting organisations dealing directly with the physical fallout caused by the bushfires. Life-or-death videos from inside the inferno have been viewed by millions of people across the globe, with the destruction sparking an outpouring of donations from those eager to help – both financially, and otherwise.

‘The images of the bushfires have been broadcast worldwide,’ explains Eaton.

‘The world is a much smaller place because of the speed in which news travels and just the outpouring of support from Australia has been phenomenal, as well as the outpouring from all parts of the world: Mongolia, Estonia, and the US – every corner of the world knows about the bushfires and wants to help. This is humanity in action.’

Greenpeace Australia has also drawn attention and support to the cause.

‘We raised over $74,000 on behalf of the Rural Fire Service to support their work in battling the fires on the ground,’ says Bullock.

‘Additionally, we have provided a platform for bushfire survivors to tell their stories to the world, and our creative team has been busy documenting the destruction of homes and nature to help people truly understand the effects of climate-related emergencies.’

The response of people wanting to donate to the cause has been overwhelming, and has been helped by social media. But, while undoubtedly positive, charity in the 21st century raises unique questions that must be addressed by legal teams such as Eaton’s.

‘A lot of the issues that we have been working through relate to the proliferation of social media and people sharing our fundraising links,’ she explains.

The response of people wanting to donate to the cause has been overwhelming.

‘This is therefore raising questions: can we accept donations from overseas? What are our limitations with respect to the donations? How do I characterise those donations? Could we be considered fundraising in other jurisdictions? If so, what does that mean?’

‘Coming up with this guidance in the online space can be very difficult, because you might have one link in Australia which now can be shared globally. Nowadays, those issues are just tricky for all businesses to navigate.’

‘This is not just relevant to us in this particular situation – talking about disasters – but I am sure many other legal counsels are faced with the issue of how do we make our laws, which are jurisdictionally based, relevant to a global online environment.’

Overcoming this challenge, Eaton focused on drawing legal similarities to other similar situations.

‘How I characterise this is similar to a financial services organisation,’ she says.

‘When they are running an IPO, you are getting money from the public to do something – namely, an IPO is aligned to accepting donations from the public – and with that comes great responsibility to make sure you are telling people accurately where that money is going, how that money is being spent, and where those funds are going to be allocated.’

‘So one of the more tricky issues we have been managing is around the social media response and global organisations wanting to fundraise on our behalf – what does that mean from a regulatory perspective?’

As in-house counsel operating on the front lines, crisis management should be viewed through multiple lenses, stresses Eaton.

‘Part of our role, I think, as legal is to not only approach things through a legal lens but, in times of emergencies, to also bring a different focus. By looking at it through the eyes of our donors – our very extraordinarily generous donors – as well as the community, we have to consider: what are their expectations? What are the needs of the community we are trying to serve? How are we balancing those needs? How are we trying to do the most good we can, and support people in this challenging time? All whilst making sure we have all the checks and balances in place.’

At your own risk

Whether battling the fallout of a financial meltdown, supply chain interruption or environmental disaster – such as the Australian bushfires – crisis management is a core skill for general counsel, irrespective of the industry they represent. Counsel will be relied upon to give efficient, fast and accurate legal advice during emergencies, and play a key role in navigating the business through complex regulatory challenges and obstacles in times of disaster.

Despite having to overcome major legal obstacles, the scope of legal work can be rewarding for those on the front lines, believes Eaton.

‘It has been fascinating, actually. One of the things I love about being in-house is the diversity of work that we are faced with on a daily basis, and when there is a disaster, such as the bush fires, it has really come to the fore.’

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Too much of a good thing?

Nearly $1bn was invested in legal technology and New Law disruptors in 2018. That was across more than 50 funding rounds and included start-ups through to more established players, according to research from Investec. Venture capital, private equity, non-legal companies and trade buyers are increasingly interested in what they see as a highly lucrative legal sector.

The frequency and scope of legal tech funding has also jumped markedly: a Thomson Reuters report in mid-2017 put investment into UK legal tech start-ups at just £16m in the previous 18 months. Hundreds of legal tech companies have subsequently popped up. Every law firm is quick to tout its latest innovation or partnership with a technology provider, while some even have incubators where they work with start-ups over several months, honing products.

But the adoption of legal tech and automation tools by in-house legal departments is harder to track. Many general counsel complain it is difficult to deduce the substance from the noise, believing in-house tech solutions largely fall into the latter camp. Others are more upbeat on progress made over the last few years: ‘There’s been a shift,’ comments easyJet group GC and company secretary Maaike de Bie. ‘Where tech and automation were once looked at by some in-house legal teams, they are now definitely mainstream.’

The growing influence and prevalence of in-house legal operations teams, continued pressure on budgets and a desire to improve the quality of work for in-house lawyers are all contributing to the change. There is no shortage of vendors looking to crack the in-house market either. With this in mind, we surveyed 70 legal departments and spoke to more than two dozen GCs to assess how much progress has been made with legal tech; what is being used and what for; the major barriers to adoption; and expectations for the future.

With two-thirds of in-house teams reporting they have no dedicated annual budget for legal tech and a third not currently exploring new tools, the conversation is shifting from what is out there to how teams can make use of existing technology and the importance of the broader digital transformation triumvirate of people, process and technology.

‘Technology is a facilitator and part of a solution. It is never in and of itself a solution to a problem,’ says Pearson associate GC for technology and operations, Robert Mignanelli. ‘You first have to scope your problem, understand what you’re trying to solve and then find a piece of technology that can help automate and drive that.’

Going mainstream

GCs constantly talk about running their legal teams like a business. To do that, however, you need to know exactly the nature of that business. Document management systems, workflow tools, e-billing solutions and management information services have existed for many years, but there has been a rapid evolution and increasing sophistication of these products. They have crucially become more user-friendly too.

Broadly, there has been an increase in basic management tools that are not necessarily cutting edge but vital to running a department. Increasingly, the point has been about finding systems that can talk to others so that, for instance, your workflow tool and document management system work in tandem. As an example, Neota Logic – which offers document management, expertise automation and workflow automation all in one platform – finds many legal departments need to start with a simple triage application to work out exactly what their department has to deal with on a daily basis and route those requests to the right people.

‘It’s changed rapidly,’ notes UBS investment bank and EMEA GC Simon Croxford. ‘I’m a big fan of the technology and process efficiency developments we’re seeing in the industry, because there is a lot that we can improve in our legal departments to become more efficient.’

Meanwhile, Barclays has integrated its matter management, e-billing, time recording and external legal spend tracker over the past three years. Head of legal transformation Ben Eason comments: ‘We’ve taken the time and the effort to do that, even if it’s not deemed the fancy work. That enables you then to start looking at stuff like AI.’

The consensus is that using tech has moved from rhetoric to action, particularly for larger in-house teams. At Vodafone Business, the FTSE 100 telecoms company’s B2B arm, legal director Kerry Phillip implemented a contract lifecycle platform three years ago. There are more than 60,000 searchable contracts on that system now, used across ten countries, while the workflow tool sends work directly to the relevant team. Phillip says that at the time it was first used, however, Vodafone was an outlier: ‘It is now accepted you need to do it and there are a huge range of providers out there. It’s unusual not to be thinking about or implementing some form of tech, which was not the case three years ago.’

‘There’s been a shift. Tech and automation are now definitely mainstream.’

As a further sign of growth, Thomson Reuters made a significant play in this area with the mid-2019 acquisition of secure file-sharing and collaboration platform HighQ for a reported £200m. HighQ sells to both law firms and in-house legal departments, marketing itself to the latter as a tool for streamlining operations. There has also been a boom in contract tools, broadly split into pre and post-signature analysis: contract review, due diligence, contract lifecycle management and understanding the data within contracts. Israel-based contract review automation company LawGeex, which announced a partnership with Neota Logic to automate a third-party non-disclosure agreement (NDA) approval process, is cited by multiple GCs. Liberty Mutual Insurance innovation director for corporate legal, Jeffrey Marple, comments: ‘In the last year or so there’s been a massive explosion in the contract space. Based on the number of products, there must be a market, because they seem to be popping up everywhere.’

Trainline GC and director of regulatory affairs Neil Murrin adds: ‘What you’ve got now is a lot of market entrants and that’s driving competition among providers, but we are still in a period of development. Certainly with some of the AI and legal tech we’ve used, we’ve been the guinea pigs.’

Back to basics

Automation of repetitive, low-value work has become more commonplace in-house, however. Tools for automating NDAs and self-service tools are widely provided by GCs as examples of successful recent tech projects. Just over a third of the in-house legal teams surveyed say they use tools to automate contract and data management, while NDAs and other forms and templates are automated by 8% and 14% respectively.

ICICI Bank UK GC Priti Shetty has introduced an internal chatbot, developed by the business itself. It is used to identify which clauses are important and do not necessarily need to be fielded by in-house lawyers. Sheldon Renkema, general manager of legal for Australian retail conglomerate Wesfarmers, used AI automation platform Neota Logic to build marketing review and contract review tools. The former is used to educate the business about the most important aspects of marketing campaigns from a legal perspective, a built-in response to the team being asked the same questions repeatedly. The latter, meanwhile, ensures contract owners in the business provide the legal team with relevant background data and context.

‘We’re looking at further opportunities for self-service tools, but you’ve got to do that quite cautiously because the personal relationship is super important,’ he comments. ‘It means we get a seat at the table because we are helping people, and have closer relationships, and get involved earlier on, which makes our lives easier.’

Many GCs are also not convinced their legal teams need to use specific legal tech products. ‘It’s not all about AI and complicated sounding terminology – at one of the biggest tech companies in the world, I have found that the most basic tools can transform how lawyers service their client teams,’ Facebook associate GC Caroline Kenny comments. ‘We use document-sharing tools like Google Docs and Quip, which clients can feed into in real time, saving the back and forth and duplication. These things are not specific to legal teams.’

Anglo American head of legal for M&A, Samantha Thompson, joined the FTSE 100 mining company at the end of last year. In March, she took on an optimisation and innovation role with a mandate to assess legal tech offerings. She quickly learned that the legal department was better placed to optimise use of existing tools within the organisation as a priority, such as Microsoft Office 365, rather than bespoke legal tech. That has involved talking to the company’s IT team to put the legal function forward for any upcoming pilots in areas such as document management. ‘What has struck me is there are an awful lot of different options out there, and people are trying to sell me things, and want to talk about legal tech,’ she comments. ‘I stepped back and said: “Lawyers don’t necessarily have special needs – we need to optimise the tech that we’ve got.”’

It is a common sentiment, with many GCs referencing Office 365 in particular, including those at blue-chip corporates Pearson, Centrica, Vodafone, Aviva, Spire, Three and easyJet. Most highlight it as an intuitive collaboration platform, while group communication tools such as Microsoft Teams are also widely used. Former Royal Mail GC de Bie, who joined easyJet in mid-2019, says when she is looking at tech, her first thought is not whether there is a tool on the market, but whether she can improve the process around the problem first and whether it can be solved by existing tools within the company. ‘Is there something I can adapt that works already within the enterprise environment, rather than bringing in another tool into the already many applications that many organisations have? The more you bring in, the more you are introducing complexity and risk.’

Case study: Wesfarmers

The Australian retail conglomerate Wesfarmers introduced a legal operations and tech working group three years ago, led by general manager of legal, Sheldon Renkema. The team of five had been looking at new processes and tech tools part time, alongside their day-to-day roles.

But they have already implemented a number of tech products: Xakia for matter management, Persuit for tendering work and Neota Logic to create various self-service applications in areas such as marketing. Xakia has established metrics around internal demand for the legal team, while Renkema says Persuit has saved the company hundreds of thousands of dollars on high-volume areas of work, such as public liability claims. Wesfarmers uploads a matter to the system that law firms then bid for.

Renkema comments: ‘We found quite quickly there was a huge delta between the top and bottom price, but within the space of a couple of months that narrowed and we discovered what the market price was. Some firms self-selected out of that and others love it.’

As part of its declared strategy of reducing the volume of low-complexity and low-strategic significance work that the legal team is engaged in, Wesfarmers focused on the automation of the high volume of NDAs that the company creates, choosing Neota to provide a solution integrated with Neota’s Workflow and Analytics Dashboard, allowing Wesfarmers’ lawyers a single console from which to view the status of every NDA associated with the business. The dashboard not only tracks at what stage of the process a particular NDA is up to, but also provides insight into each individual agreement.

Renkema noted that early business users of the application ‘Were surprised at how easy and intuitive the application is to use’ and highlighted the efficiencies it has created ‘By allowing for a much quicker turnaround.’

Aviva’s head of legal operations, Caroline Brown, adds: ‘While there are a lot of nuanced tools out there, there are also lots of non-legal tools we’ve been able to use. We’re looking at working with Microsoft to roll out Office 365 and we’re finding it to be an intuitive tool. People have been able to pick up the features easily, which raises the bar for other technology platforms on things like file and document sharing.’

Three GC and regulatory affairs director Stephen Lerner has similarly turned to a non-legal tech solution provided by Microsoft, using business analytics tool Power BI. Three years ago, he hired four non-lawyer business analysts and IT experts into his legal, commercial and regulatory affairs team of 130 staff. That team is tasked with using Power BI to mine internal data and track things such as resource optimisation – how many matters are coming into the legal function and how they are staffed. ‘It took probably a year or so to get it right, but now I can open up this tool on my desktop any time and see what demand is coming through the department, and how we are staffed to meet that,’ he comments. Similar outcomes can be achieved with an application built in by Neota Logic using its analytics component on its platform to access the various requests coming into the legal department.

GCs also say the people aspect is more important than the technology. Digital training programmes and the employment of non-lawyer professionals or lawyers with wider skillsets are firmly on the agenda. At the beginning of 2018, UBS kick-started an in-house legal team transformation and digitisation programme. Croxford says there has been a focus on enabling its lawyers to talk technology. This has manifested in a number of ways, including an in-house academy to educate lawyers in areas such as digital literacy – understanding the technology it uses and how it impacts the business. But there are softer aspects, such as sitting product-focused lawyers with data privacy and technology lawyers so they can mix ideas.

‘There are lawyers who exist with data and tech skills or exist with product skills, but the market hasn’t developed to the point where it’s doing what we’re trying to do, which is combine the two,’ he comments. ‘To be a successful in-house lawyer nowadays you need a variety of different skills that were rarely needed five years ago and definitely not ten years ago.’

Making the case

It is clear why GCs turn to existing company tools for solutions. The cost of legal tech, and finding ways to articulate the business case and expected returns, is regularly cited as a major obstacle to adoption. Of the third of survey respondents to report a dedicated budget for legal technology, most were at 10% or less of their overall legal spend. Many GCs say the cost of much legal tech has been prohibitively expensive, although it is improving, while establishing which metrics show return on investment remains difficult.

Two-thirds say their company’s IT department is involved in the decision-making process for implementing technology, with procurement and the C-suite involved for a third each as well. But for half of the survey’s respondents, less than 50% of their legal spend is on outside counsel. They are therefore looking for ways to reduce internal costs. Phoenix Group GC Quentin Zentner, who uses legal spend-tracking software Apperio, comments: ‘Securing a budget is key. You need a good, plausible business case. It was easier to secure approval by making the proposed technology spend part of a wider cost-cutting initiative.’

Liberty’s Marple comments: ‘Technology providers claim to save you money on x, y, and z, and they probably will, but unfortunately we may not have a clear understanding of the possible savings. You do all the research and analysis you can up front, but sometimes you just have to hold your breath and jump in, and hopefully it works out.’

There is also a sense that much legal tech offers solutions to non-existent problems and does not easily connect to existing tech infrastructure. ‘A lot of the solutions out there are looking for a problem. All legal departments are different and the tech all seems to be a bit one-size- fits-all,’ Spire GC and group company secretary Dan Toner comments. ‘The tech needs to come from the demand side. The cost of it is dropping rapidly, but it’s working out how much it works with our tech, and it’s getting the time and the head space to put work into it.’

Adds Anglo American’s Thompson: ‘The impression I get is people are just struggling with the number of products out there and it’s not clear that there’s a market leader or someone with longevity, or that there’s even a need for the niche tech.’ This is where the increasing prevalence of operations professionals within legal teams comes in. Only 33% of those surveyed have a legal operations role within their team, but many of those achieving tangible results with tech have done so through legal ops. Guardian Media Group GC and company secretary Stephen Godsell comments: ‘The great value of operations is that it gives somebody the task of driving change in a way that it’s their day-to-day job. Lawyers are very busy and there’s not a lot of space to investigate how we can do things differently.’

Neota, a no-code AI automation platform targeting professional services companies, is just about to launch a web-based tool called Canvas, which allows subject-matter experts, such as lawyers, to prototype apps for automating legal services. Vice president, markets and growth, Jackson Liu, says demand from in-house legal teams for technology has increased, led by the larger North American market, but with EMEA and Asia-Pacific growing quickly. Legal operations teams – which have featured in the US market for longer – led process improvements, with many now looking to add technology to those.

Implementing new technology: a guide for GCS

Finding internal technology champions, building use cases across multiple departments, learning how to measure return on investment (ROI), and simply being willing to give it a go: these are the keys to success for using legal technology, says Neota Logic’s director of client solutions and engagement, Shaz Aziz.

‘Tech providers should help people understand the market, especially when companies are early on in the technology-building and solution-finding process,’ he says. ‘You can look at the legal tech market and see 100 different names and it just looks like the Wild West.’

To navigate that plethora of providers, Aziz says in-house legal teams should expect potential tech partners to help them establish potential use cases and to understand their business’ needs and requirements. ‘Back in the day, you’d sell the software to somebody, chuck it over the fence and they’d work out how to use it.’

As technology providers are increasingly expected to be advisers on technology, in-house legal departments will need to identify internal technology champions – often legal operations staff but, just as regularly, legal counsel – and importantly, establish use cases across multiple departments. If a legal team can find a solution that crosses over into human resources or procurement then there is greater scope for adding value across the business, as well as sharing the cost. Aziz comments: ‘If you can connect those people up in the business and allow cross-sharing, then it makes the process of getting buy-in much easier.’

Furthermore, legal teams need to learn how to measure the ROI from technology. This can be difficult to do with potential tech partners as information on cost is not easily shared, however. ‘If you can, in a granular way, understand what the cost saving is and can start to be able to put figures to things, that can make a massive difference in the early stage,’ adds Aziz.

‘They’re now looking for a platform, an off-the-shelf solution, to look at how they can implement automation capabilities on top of those new processes. Having a separate team focus on the process and technology side in legal operations is good because it separates that from the legal counsel team, which means they’re not dragged away from the day-to-day tasks.’

GCs are also leaning on their law firm advisers to use technology to provide more efficient, and cheaper, services. There is a transparency issue on that side as well, however, with GCs unclear on what law firms offer, despite the bevvy of press releases each pushes regarding their innovation credentials. Anglo American group GC Richard Price comments: ‘They’re all talking about it and they’re all looking at it, and they’re talking to us about how they might be able to use tech in a way to optimise the service that they provide to us, but we’re yet to see significant applications of that.’

Others are more optimistic. UBS talks to the firms that run innovation and tech incubators to keep an eye on developments. Croxford sees the growth of managed service and contracting teams at some firms as an important development too. ‘It’s not just the sourcing of legal advice but how we run our departments as well. That’s the next evolution of relationships between banks and external law firms.’

Demonstrating value

The GC100 group, made up of more than 125 GCs and company secretaries primarily from the FTSE 100, has put tech growth and adoption onto its agenda. Everybody is keen to share and get a grip on the market. ‘Everyone assumes that they’re far behind and everyone else is much further ahead, and it’s helpful to talk to our peers to understand we’re all just trying to get our arms around it,’ Price comments.

There is undoubted appetite, and need, for in-house legal departments to adopt tech. There are multiple examples of early success in automating volume work, while many teams are now tracking data on their use of internal and external resource. That resulting data is where many GCs see the next wave of advancement. Analytics and then true AI and machine learning – despite the prevalent scepticism – will be used by GCs to understand their workflow and allow it to be optimised. More AI solutions aimed at interpreting and creating legal documents and contracts are expected to pop up as well.

But GCs are keen to pull the conversation away from a focus on pure technology, and back to a broader emphasis on how that fits in with people and teams. They are analysing whether they have the right people in the right locations, the right levels of seniority, and then whether they are doing the right work. ‘To run a truly successful and efficient department, technology helps you get there, but it’s not the be-all and end-all,’ Croxford comments.

Adds de Bie: ‘I’m a big fan of data. Business colleagues are used to presenting data and level of risk, and I don’t see any reason why we as a legal team cannot do the same. I’ve really seen the value of collecting data to demonstrate value.’

For more information, please contact: E: hello@neotalogic.com www.neotalogic.com

Artwork and imagery used by kind permission of Haynes Publishing Group, a leading supplier of content, data and innovative workflow solutions for the automotive industry and motorists. For more, see www.haynes.com

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GC Insider: Timo Matthias Spitzer

In my personal opinion, to be a strong and independent leader, the general counsel needs the trust of the CEO – not only to advise on issues of legal compliance, but also on the righteousness of corporate action and, ideally as part of senior management, assist with the creation of sustainable stakeholder value. Importantly, the stakeholder group goes beyond the shareholder and also includes employees, customers, suppliers, the environment and the wider society in which a company operates as corporate citizen. A rigid adherence to the outdated doctrine of shareholder primacy could have the adverse effect of making corporate decision-makers potentially indifferent to the interests of other stakeholders, which, at least in the long run, may even harm the shareholders themselves.

Respectively, in his book Fixing the Game, Roger L. Martin, then-Dean of Rotman School of Management, made clear:

‘Total returns on the S&P 500 for the period from the end of the Great Depression (1933) to the end of 1976, the beginning of the shareholder-value era, were 7.5% (compound annual). From 1977 to the end of 2010, they were 6.5% – suggesting that shareholders have little to celebrate, despite having been made the clear priority.’

A sole focus on profit maximisation may not only overshadow a company’s true purpose in society, but even create unintentional pressures for corruption, which might ultimately tempt some managers towards taking irresponsible actions just to meet potentially unrealistic financial targets.

Consequently, human leadership with integrity is key, especially in a highly regulated and tech-reliant corporate environment. We must always retain and train our human ability to make responsible judgement calls in order to ensure sustainable decision-making in a fast-paced, globalised business. Leadership is not just about making shareholders wealthy. Leaders build a corporate culture where employees can feel safe and valued so that they may perform to the best of their abilities. It is about leading with kindness, concern and compassion, with regard to the society as a whole. The great thing about this is that it results in an organisation that creates sustainable benefits for all stakeholders, making a corporation a desirable commercial partner for anyone on a global level. Society does not want to do business with entities it does not understand and respect. A decent and humane management, relying on a strong, voluntary ethical framework and the power of morally capable people, is key to ensuring both internal and external sustainability.

Corporate governance codes around the world have begun to address the problem of shareholder primacy. For example, in the US, various state codes recognise the wider range of stakeholder interests beyond the shareholder. A revised UK Corporate Governance Code was published by the Financial Reporting Counsel in 2018, representing a refocusing of the role of the company and the board toward not only generating value for shareholders, but contributing to wider society. The German Corporate Governance Code, as amended in 2019 and about to enter into force, highlights the management and supervisory board’s obligation to ensure the continued existence of the company and its sustainable value creation that is in line with the principles of the social market economy. South Africa’s Institute of Directors published the King IV Report on Corporate Governance in 2016, establishing the transition from a purely shareholder-oriented capitalism to a wider stakeholder-oriented capitalism.

By elevating the general counsel to the C-suite, the CEO can ensure a cross-functional dialogue.

While this is a step toward recognising the problem of pure shareholder primacy, it is not a solution in and of itself. These codes cannot guarantee the inclusion of wider stakeholder interests when they are non- binding in nature and, as such, the company could easily opt out.

What, then, should be done to address this issue properly?

One solution is to move away from the classic corporate form where the shareholder(s) alone can dominate the direction in which a company is going. For stakeholder interests to be effectively included, we should change the corporate form by building an all-stakeholder entity where not only shareholders, but also employees, customers and representatives of the wider community could exercise a shared vote and, as such, have a legally binding say in the move toward sustainability. Such an entity would not only focus on the shareholder, but on each relevant stakeholder. In addition to maximising shareholder value, the effect of this would be that the company would fulfil its societal purpose by legally taking into account the entire context of its responsibilities.

However, achieving this legal solution is admittedly difficult. The fundamental changes to corporate laws required to create this multi-party entity are hard to achieve due to current market realities.

Nevertheless, there is a practical solution that can be done that does not involve significant changes to applicable corporate laws. By elevating the general counsel to the C-suite, the CEO can ensure a cross-functional dialogue within a working group on corporate strategy, and involve the general counsel in assessing wider stakeholders and general sustainability factors. The general counsel can play a cardinal role in supporting the CEO not only as a legal expert, but also as a trusted and accountable adviser, acting as part of the corporate moral compass.

Because while a company’s long-term success depends on strong performance and prudent risk management, it also depends on high integrity, which requires leadership from people with a refined ability to make moral judgement calls. The essence of integrity is, first, to ensure that the rules – whether legal, commercial, or ethical – are fair, and then to comply with them. Traditional moral values also must be reinforced, including (but never be limited to): honesty, fairness, trustworthiness, reliability and commitment to inclusion. It is crucial that the CEO and his or her colleagues around the table adhere to a sustainable corporate culture, in order to gain the trust and cooperation of all relevant stakeholders. A general counsel next to the CEO in the C-suite may prevent the company from significant costs and loss of reputation, ensure sustainable corporate decision-making and, last but not least, strengthen the legal function.

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Foreword: Steven Gartner

Diversity and inclusion initiatives have risen in prominence across the business world in recent years. They stem from core business goals – not abstract social objectives – and are publicly embraced and supported by leadership at the highest levels. Law firms around the world have long recognised the need to invest in diversity and inclusion programmes that further commitment to these ideals, but industry progress has been modest.

At Willkie, we believe everyone benefits from a diverse and inclusive workplace in which all personnel are treated with courtesy, dignity, and respect. The confluence of people of different gender identities, races, cultures, religions, beliefs, and sexual orientations across the firm yields a stronger team that is more adept at creative problem-solving on behalf of our clients. In fact, Willkie’s first female associate, Mary MacDonagh, was hired in 1939, which was extremely rare at the time. We have always known our most valuable asset is our people.

We are committed to continuing to enhance diversity and inclusion on a long-term basis, including in our leadership ranks. Currently, two women and one diverse partner are on our firm’s management committee. Seven women and five diverse partners serve as department or practice group chairs or co-chairs, five women and three diverse partners or counsel lead firm committees, and three diverse partners and two women serve as office managing partners. Of the US-based attorneys elected to the partnership this past year, 45% are women and 36% are diverse. The firm’s head of our Latin America Practice Group, Maria-Leticia Ossa Daza, who is profiled in this issue, has done a tremendous amount to support these efforts by actively supporting and mentoring other women at Willkie and across the industry. She leads our firm’s Latinx Affinity Group and regularly speaks about diversity at industry conferences in Latin America and the US.

As companies around the world have implemented comprehensive diversity programmes, law firms have welcomed the opportunity to partner with clients in these efforts. At Willkie, we regularly collaborate with clients on initiatives to further diversity and inclusion, including educational seminars, conferences and roundtable panels, and pro bono and mentorship programmes. Diversity also plays a major role in the success of our Latin America Practice Group, made up of lawyers from Brazil, Mexico, Colombia, Chile and Uruguay. This diversity enriches our practice and client relationships across Latin America, and our firm generally.

On a firm-wide level, embracing diversity and inclusion is critical to our overall success. We recognise that there is still much more to do at Willkie and across the legal industry. Diversity and inclusion will remain core to the values of the firm. We look forward to continuing our work, in conjunction with our colleagues and clients, of cultivating an environment that is diverse and inclusive at all levels.

Steven Gartner Chairman Willkie Farr & Gallagher LLP

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A new era of matriarchal lawyers

As a region, Latin America accounts for a 22% share of all lawyers globally, and an estimated 33% share of female lawyers globally. Despite this, just 25% of top management roles are occupied by women, and those in top management roles earn just 60% of that paid to their male counterparts. In Argentina, Brazil, Colombia, Chile, Mexico, Peru and Venezuela, women earn between 49 and 68 cents for every dollar that men earn in the same or similar roles.

Disappointingly, this is in step with much of the rest of the world. According to a 2019 report published by the World Bank, just six countries globally achieved a perfect score in gender equality, which means that the law in each of those countries treats men and women equally in every dimension measured by the research. The report covered 190 countries.

While Latin America shares the struggle for gender equality with much of the world, it faces unique barriers (in addition to those common to the rest of the world) in achieving that goal. Chiefly, the region’s distinct cultural and religious history has led to especially institutionalised gender bias, informing modern day attitudes which in turn make efficient reform difficult. A 2013 McKinsey & Company survey of 547 executives across Latin America found that 70% of those surveyed indicated that societal views of women’s primary responsibilities – namely, the raising of families – were a strong influence on how women make career decisions.

In some countries in the region, the institutionalised gender bias is subtle, but in others it is more obvious. Jair Bolsonaro, president of Brazil, Latin America’s largest economy and the world’s fourth-largest democracy, is renowned for his ‘government-by-machismo’ approach to politics, and is illustrative of populist attitudes toward women. Bolsonaro has been the subject of numerous protests since his inauguration, due to his inflammatory comments regarding women, as well as various ethnic and sexual minority groups. Bolsonaro has outright placed himself in opposition to what he pejoratively calls ‘gender ideology’ – a largely conservative term used to undermine pushes for equality as antithetical to religious and family values.

“Bolsonaro has outright placed himself in opposition to what he pejoratively calls ‘gender ideology’.”

But it is not just men who perpetuate gender stereotypes. Arguably, a large number of Latin American women also feed into these traditional gender roles. They believe it is their responsibility to take on all of the ‘home work’, which becomes more apparent after having children. Patricia Barbelli, Diageo’s legal and corporate security director of Paraguay, Uruguay, and Brazil, argues that men and women may take up distinctly separate positions at both work and home, to encourage a work-life balance.

Female perpetuation of stereotypes has also been seen through the remarks of Damares Alves, Brazilian minister of human rights, family and women, who assists Bolsonaro in his battle against ‘gender ideology’. Alves strongly supports traditional gender roles and is an opponent of so-called ‘ideological indoctrination’. In January 2019, when Bolsonaro came to power, Alves tweeted: ‘Women are made to be mothers’ and ‘It’s a new era in Brazil: Boys wear blue and girls wear pink!’. Alves asserts the view that diversity and inclusion programmes are a ‘threat’ to Brazilian families. Bolsonaro has also concisely propagated the long-peddled excuse for gaps in pay between men and women, arguing that men and women should not receive equal salaries and that he wouldn’t hire women with the same salary as men because women may fall pregnant.

The gender pay gap

According to the World Economic Forum, the gender pay gap of 29.2% in Latin America will take an estimated 64 years to close. The lack of practical regulation requiring businesses to observe compliance with equal rights legislation, especially gender pay regulation, to government and authoritative bodies, remains a substantial obstacle in ending the gender pay gap. Currently in Latin America, recording obligations exist only in Peru and Colombia. That said, Latin American governments are increasingly making an active effort to rectify this.

Gender discrimination is expressly prohibited in Argentina, Brazil, Colombia, Chile, Mexico, Peru and Venezuela. These nations all allow for provisions for differing legal action in relation to employees, against their respective employers, who permit gender discrimination within the workplace. For instance, in Mexico, employers who allow gender discrimination in the workplace may face labour ministry sanctions. Mexican employees are also able to bring civil action for ‘moral damages’ and criminal action under discrimination against their employer. These employees can also choose to file a complaint to the National Commission to Prevent Discrimination for payment of damages, a public warning, and/or a public or private apology.

In 2011, the Colombian Ministry of Labour stated that all Colombian businesses must document a gender pay record for audit or visits. Though this is not a direct recording requirement, it requires businesses to retain salary, job specifications, and requirements when beginning employment at the business via a gender lens.

More recently, in 2017, the Peruvian government passed a law prohibiting discrimination between men and women. The law prohibits salary discrimination between men and women, implements a recording specification (similar to that of Colombia) and prescribes businesses to notify their respective employees of payroll initiatives (and aspects affecting wages). Failure to comply with such laws may result in severe penalties for the employer. The 2017 law also recognised that sustained discrimination within the workplace would be treated as a ‘hostile act’, raising grounds for legal action against employers to allege ‘constructive dismissal’ and the payment of ‘mandatory severance’.

Research suggests that one of the primary causes of the gender pay gap is lack of representation of women in senior roles, but the lack of women in senior roles is a problem in itself. Companies and law firms are only now beginning to view gender bias as a problem. This is seen to be a separate issue that must first be addressed before the inclusion of women in senior roles. ‘The top levels of companies and most partners within law firms are still being filled by men,’ says Barbelli. According to the 2018 McKinsey & Company and LeanIn.org ‘Women in the Workplace’ paper, men surpass women at every level within the workplace.

Mónica Jiménez González, secretary general of Ecopetrol Colombia SA, outlines how instead of taking slow and rigid action in addressing the gender pay gap, Ecopetrol is analysing its own company data. Ecopetrol assesses the salaries of their employees at all levels with reference to their job title. When the company has completed a comparative analysis of all job specifications, then Ecopetrol decides the employee salary. This comparative method disregards any gender bias.

Private progress

With negative attitudes toward the position of women in the workplace common at all levels of Latin American society – from religious institutions to the highest of national offices – and with governments occupied by more imminent concerns (such as widespread corruption), it may fall to private businesses to take the lead in correcting entrenched biases and disparity in the workplace.

‘We can see that in the last few years significant efforts have been made by various governments, but most importantly by the privately-owned companies, which I believe are the present leaders when talking about changing traditional mind-sets, not only as a part of natural evolution, but also as a way to improve their labour environments, which can surely lead to a revenue increase as well,’ says Ivonne Romero, SSA Mexico’s general counsel.

As such, internally developed policies and efforts in the private sector might become the most effective tool at advancing the cause of diversity, equality, and inclusion in Latin America.

‘We make sure that we have recruitment processes with an equal number of men and women candidates, in order to ensure that we have an expanded applicant pool that allows professionals to be selected objectively,’ says Sandra Monroy, legal director, Andean region for Uber and Uber Eats.

Programmes such as diversity in candidate pools, as implemented at Uber, are intended to safeguard the inclusion of women and other specified groups within the workplace. The 2016 Harvard Business Review article ‘If There’s Only One Woman in Your Candidate Pool, There’s Statistically No Chance She’ll Be Hired’ outlines that when ‘there were two women in the pool of [four] finalists, the status quo changed, resulting in a woman becoming the favoured candidate,’ and there would be a 50% chance of hiring a woman. These initiatives, if implemented, will undoubtedly increase women’s representation within the workplace.

Although law firms and companies have, in recent years, focused on recruitment processes to tackle the lack of women of women in top management roles, firms and companies alike are now increasingly identifying that more action is required to help women advance. Men and women progress through the workplace pipeline at differing rates and it is clear that gender prejudice and discrimination are an explanation for this. As far back as 2011, Catalyst’s report ‘The Myth of the Ideal Worker: Does Doing All the Right Things Really Get Women Ahead?’ outlined the idea of a ‘social penalty’ where women are more likely to be perceived negatively when asking for work promotions and salary increases, than their male counterparts. But thankfully, that is slowly starting to change with the growing influence of women in senior roles.

‘At SSA Mexico the legal function is part of the executive team, so we have the opportunity to advise the company on how to deal with gender inequality. In my team there are women lawyers (mothers and single). They know that they can count on my support when speaking of their development as women and lawyers,’ adds Romero.

As research continues to be conducted on the effects of diversity in firms – legal and otherwise – the business case is becoming increasingly hard to ignore, and charges of ‘meaningless box ticking’ hold less and less weight.

‘This is not just a moral obligation, but a sound business strategy,’ Barbelli surmises.

Diversity and business value

There is an established connection between gender diversity and a company’s bottom line profit. There is also clear connection between focussing on the gender pay gap and the war for attracting and retaining talent.

Regional trends Regulation concerning discrimination, harassment or sexual assault within the workplace differ from region to region in Latin America. However, ‘if a company has strong policies defining what is acceptable or not in regard to behaviour that may be considered discrimination or harassment in the workplace, this will help a lot to define the boundaries of what is tolerated or not from the employees,’ says Barbelli. Diageo implements a global ‘Dignity at work’ policy whereby every employee is individually responsible for demonstrating the highest standards of integrity in their behaviour, and harassing, sexually harassing or bullying, victimising, threatening or retaliating is not tolerated. Romero states that, ‘it is important to realise that although a company’s nationality can potentially help create a cascade effect in its corresponding subsidiaries in terms of policies, it does not necessarily mean that the company will completely follow that model in a local context, such as Mexico. For instance, we can see that a lot of Mexican locally-owned companies are currently putting a lot of effort in to inclusion, sometimes even more so than international ones. The latter are probably at a loss when trying to apply inclusion policies at a local level.’

Studies also suggest that one of the leading reasons women are deterred from pursuing leadership and partner roles stems from a lack of flexibility, and a lack of positive women role models and mentors.

Various businesses are now active concerning women employee advancement, and this often means going beyond statutory regulations. SSA Mexico, for example, operates ‘flex time’ working schemes and offers additional maternity days, which are not necessarily specified under Mexican law.

‘Uber has several employee resource groups, devoted to women, such as “Women of Uber” and “Parents at Uber” among others, which allow women to embrace themselves and improve every day in their working environment,’ says Monroy.

Mentorship can play an important role in development, with ‘a good role model inspiring you to be the greatest version of yourself, not only on the professional, but personal field too. We [women] are often seen as rivals, when we should be allies. The importance of advocating for women’s higher performance, mentoring, and establishing a support network, all help to erase damaging stereotypes,’ Monroy says.

Fatima Picoto, assistant general counsel and legal director Brazil at GlaxoSmithKline (GSK), also speaks of the value in mentorship for progressing in the workplace, arguing that it is a valuable tool for all employees, not solely women. ‘However, considering the different challenges that women tend to face, identifying someone who can support and sponsor you will have a huge impact,’ Picoto adds.

Pregnancy discrimination (despite being against the law) still exists within Latin America. According to the US Bureau of Democracy, Human Rights and Labour, ‘some employers sought sterilisation certificates from women job applicants or tried to avoid hiring women of childbearing age.’ In the past, it was known that some Latin American employers went so far as to dismiss women employees from their job after hearing of their pregnancies. Despite both actions being unlawful, these laws are seldom enforced across the region. Pregnancy discrimination is inherently linked to a society that has historically tended to view women as home makers and mothers, rather than individuals valued in a workplace.

González notes that Colombia’s 18 weeks of maternity leave is unsatisfactory. Ecopetrol has an extended maternity leave due to the benefits it provides to both parents and children (the World Health Organisation recommends at least six months breastfeeding): ‘This will mean more breastfeeding in Colombia. In the cities, breastfeeding is almost disappearing, but in rural areas, breastfeeding is very high. Working while breastfeeding can be very tough. At Ecopetrol, we still want people to be able to breastfeed, if that’s their choice. We have maternity spaces in our buildings for women to breastfeed, which is very important. But, there’s still a long way to go,’ adds González.

Barbelli adds that ‘achieving gender equality in the workplace requires fundamental changes to a range of working practices. It is of utmost importance to reinforce that men’s parental leave is key to women’s progression.’

The ‘trickle down’ effect

Many Latin American businesses have increasingly encountered demand from, mostly foreign, shareholders to implement equal pay for equal work, or at least conduct equal pay equity audits. According to the 2018 ‘Women in the Workplace’ report, women continue to remain considerably underrepresented in the workplace, and corporations and firms must alter their approach in the hiring and promotion of employees at both an entry and manager level ‘to make real progress.’

Nonetheless, international investment in Latin American conglomerates and corporate governance in global companies is having a progressive ‘trickle down’ influence via region-specific diversity and inclusion policies. Several international businesses with teams in Latin America have voluntarily begun to enforce reformist initiatives such as extended maternity leave, flexible working, and mentoring programmes. These initiatives are aimed to appeal to, engage with, and advance women in the workplace.

Romero notes that as a subsidiary of Carrix, which is headquartered in the US, SSA Mexico ‘offers additional benefits to me as a woman who is working in an executive position. At SSA Mexico, we have a great local executive team, which is on the same page as our US counterparts.’

Many Latin American corporations are now embracing and implementing initiatives that go far above the present national statutory guidelines. Barbelli states that Diageo, which is headquartered in London, England, is transparent and candid when it comes to discussing the progression of women with careers in legal with their panel law firms.

Diageo’s credentials concerning the betterment of women in the workplace, without the existence of formal legislation, is outstanding. Women at a senior level have grown from 22% in 2017 to a mammoth 50% in 2019 and 49% of employees in Brazil’s São Paulo office are women. From July 2019, Diageo has offered six months fully-paid parental leave to both men and women employees, without any existing statutory requirements.

Monroy raises how the development of technology has impacted the increase of diversity policies globally: ‘One of the perks of the digital era is having the possibility to be connected, and somehow close, as if we are all in the same place. Uber has a global policy on diversity and inclusion that applies worldwide, allowing diversity initiatives to take place everywhere without limitations like distance.’

Many Latin American corporations are now embracing and implementing initiatives that go far above the present national statutory guidelines.

There is now a strong movement whereby women and minority groups are gaining momentum in Latin America. Picoto observes that, ‘GSK has 51% of women in our total staff and 49% of our leadership positions are also occupied by women in Brazil offices.’

#MeToo #NiUnaMenos

The advent of the #MeToo movement (or #NiUnaMenos, ‘not one less’, the #MeToo equivalent term coined in Latin America) has created a sense of ‘familiarity’ across the board with all women in their respective geographical regions, while providing them with a platform to voice their own experiences and concerns.

Given the historical role that women have traditionally played in Colombia (and Latin America as a region), the movement has started conversations about what is appropriate in the workplace and what is not. González argues that ‘#MeToo made people think: “What is that?” “Why is that everywhere?” “Why is it on Twitter?” “Why is it in the press?” “What does #MeToo mean to me?”. I have heard a lot of conversations concerning #MeToo in Colombia – this is amazing because you’re seeing women, and vulnerable women, in Colombia talking about it, which means that they are realising that they do indeed have a voice and it’s not okay for those lines to be crossed.’

“Many Latin American corporations are now embracing and implementing initiatives that go far above the present national statutory guidelines.”

The #MeToo movement created an awareness of the difficult reality that many women were, and still are, facing within the workplace environment. After recounting her own experience of harassment, Monroy states that #MeToo has had a positive impact on the women of Latin America in that they are now able to voice their concerns. This helps other women to come forward. Monroy also describes how the #MeToo movement has had a direct influence on Latin America’s ‘cultural institution’ where women who were once afraid of speaking out now have the confidence to do so.

#MeToo is a spawned concept: despite not yet being on a legislative level, it has bought awareness to the topic in Latin America. González does however note that ‘the Colombian government is of course aware of the movement and it’s making them, along with companies, ask themselves “how is this impacting us?”.’

Monroy adds: ‘Don’t ever let society-established parameters define what you can do and how far you can get.’

The barriers that women face in the Latin American legal profession originate from their historically weak status within society: from traditional gender roles to the stereotypical cultural norms of Latin America as a region. This has led to the arguable continuation of work place sex discrimination across the region. We are seeing the remnants of the Latin American ‘cultural institution’ filter down into the way women in law are perceived, with research even suggesting that the gender pay gap primarily concerns gender representation rather than pay discrimination, naming the causes as existing bias and historical pay discrimination allowing for the continuation of the gender pay gap.

Discrimination due to socioeconomic status, sexual orientation and gender identity continues in schools, reproducing stereotypes and traditional roles for women, particularly in relation to their role within the household. This ‘cultural institution’ has not only been fed by men in powerful positions, such as politicians, but also by women themselves who believe that there are specifically established roles which men and women should play. This can clearly be seen with the lack of women in senior roles and the very existence of the gender pay gap.

However, Latin American firms and companies are now seeing more and more women question how executive corporate decisions are made. The current unstable political climate in several Latin American nations, supported by the arrival of the #MeToo movement, and the ‘trickle down’ effect of conglomerate businesses, have all encouraged women to contest their role within society and workplace. This intervention by multinational companies may even cue Latin American governments to begin to include gender-related issues in their own policy programmes.

But, only a handful of Latin American nations have made headway in making motherhood and employment harmonious. Despite the majority of Latin American countries legislating to require businesses who employ 20 or more women to establish day care facilities, these laws are rarely ever enforced. The same can be said about laws governing pregnancy discrimination. There is obviously a disconnection between Latin American legislation and general attitudes towards women in the workplace. Increased efforts are required on behalf of national governments to enforce inclusion and other diversity policies locally.

We are slowly starting to see cultural developments in Latin America that don’t necessarily conform to the traditional historical norms and this has been a direct result of the advancement of the lives of women themselves. This activity will help facilitate the ending of discriminatory obstacles that Latin American women in law must overcome. As Monroy points out, the stereotypes have ‘if anything, challenged us [women] to reach our best within the legal profession,’ and that the progress in Latin America in recent years is ‘extremely valuable because of its history and the rough path that women have been through to get to this point’. Although progress on this front may be gradual, the long established cultural perimeters of specific gender based roles are also slowly (but promisingly) being eradicated.

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Turning of the tide

Research continues to show the positive correlation between a diverse and inclusive workforce, and an organisation’s bottom line. In response, there has been a sharp increase in C-suites giving strategic priority to diversity and inclusion (D&I) challenges, and there has been a significant rise in roles dedicated to it. There has also been a significant increase in the number of initiatives and training sessions aimed not only at increasing minority representation, but also tackling the underlying culture, which frequently prohibits inclusion.

But many times, these initiatives don’t work – and sometimes achieve the opposite of what is intended. It is a sad fact that, despite the substantial number of programmes in place, equality isn’t improving. Or, at least, it isn’t improving at the pace one would hope. So, what elements need to be in place for a D&I initiative to work?

Through a series of in-depth conversations with senior in-house counsel across Latin America, GC magazine looks at some of the D&I challenges the Latin America legal industry faces, the common elements that make for successful D&I programmes, and offers advice for how to effect real change – now and in the future.

Legal industry challenges

The perception of the legal industry as – in the English phrase – ‘pale, male, and stale’, is not new and is, unfortunately, only too applicable to Latin America as well. ‘Latin American law firms are, generally, predominantly male and conservative environments; that is, not inclusive towards minorities,’ says Publicis Groupe’s LatAm regional legal director, Véronique Ramon Vialar-Déchelette. ‘This is perpetuated not only by a traditional men’s club perception of law firms, but also by women’s unconscious self-discrimination and behaviour.’

“It is easier and more comfortable to deal with people of the same gender. Because, historically, the majority of CEOs are men, it is easier for them to deal with other men.”

Women are also much more likely to adapt their behaviour to fit in to this environment. ‘Even today, in traditional law firms, many women do not dare to ask for salary increases or more senior positions, they are scared to compete “as men”, and frequently prefer to resign rather than to ask for flexible working arrangements when they have children,’ Vialar-Déchelette continues. ‘As a young lawyer in a law firm, I was often very careful regarding the way I used to dress (to avoid being considered too feminine or sexy), or the way I expressed myself about work situations or problems (to avoid being considered as less capable by my male colleagues). I also avoided being too friendly or empathetic in certain situations to avoid being considered too soft, too “woman-like”.’

Of course, the problem doesn’t only exist in law firms; those ingrained biases still exist and need to be challenged in corporates as well. ‘The biggest barrier is confirmation bias, rather than unconscious bias,’ says Valéria Camacho Martins Schmitke, Zurich’s LatAm regional general counsel. ‘It is easier and more comfortable to deal with people of the same gender. Because, historically, the majority of CEOs are men, it is easier for them to deal with other men. They go to have lunch together, they talk “man talk” – they care less about words and feeling comfortable with each other. Many times, this is not conscious, but it prevents many women being promoted or hired for key positions.’

Against this backdrop, effecting real change might seem impossible, but of course, it’s not. We are seeing a slow, positive evolution across the industry. Law firms and corporates alike are committing to strategies and programmes that go beyond lip service to embed D&I into their corporate DNA.

Positive reinforcement

One of the key elements in ensuring a D&I programme or initiative is successful is positive messaging and positive reinforcement. In their 2016 Harvard Business Review article, ‘Why Diversity Programs Fail’, authors Frank Dobbin and Alexandra Kalev assert that most executives ‘favor a classic command-and-control approach to diversity’, which often leads to extensive lists of dos and don’ts. This approach, though, ‘flies in the face of nearly everything we know about how to motivate people to make changes… You won’t get managers on board by blaming and shaming them with rules and re-education. We can’t motivate people by forcing them to get with the program and punishing them if they don’t.’

This is especially true of lawyers, who can often be resistant to the idea that they might behave unfairly. Bias is often linked to being unethical, and it is ingrained in lawyers that their job is to be advocates of justice. Where companies start to see positive results is when they employ tactics that do not focus on control. When messaging is positive, involvement is voluntary, and there is social accountability, willing participants will come forward.

“People need to be conscious of their biases, and conscious of their lack of diversity. And then you can move to implementation of D&I policies, pillars, and training.”

For a D&I strategy to be successful, it must go through three phases, says Schmitke. First, awareness; second, training and development; and third, monitoring. ‘People need to be conscious of their biases, and conscious of their lack of diversity. And then you can move to implementation of D&I policies, pillars, and training.’ Once those are in place, you can start to monitor the success of your various programmes.

Policy change

Law firms and corporates are seeing their biggest successes when specific initiatives go hand-in-hand with actual policy change, and where D&I policies ring true with the employees they most affect. Matt Krentz, who leads Boston Consulting Group’s diversity and leadership efforts, wrote in a recent Harvard Business Review article that women employees seek policies that allow them to balance career and family responsibilities, and in particular ‘practical tools that would help them progress, regardless of their family status: parental leave, appropriate healthcare coverage, childcare assistance, and flexibility programs’.

The law firm perspective: D&I at Willkie Farr & Gallagher LLP

At Willkie, we believe everyone benefits from a diverse workplace, and we are firmly committed to creating and maintaining a diverse environment by recruiting and retaining people of all backgrounds and cultural experiences.

The firm has several active committees that focus on the recruitment, retention, and promotion of our attorneys and, in particular, our women and diverse attorneys. These committees’ initiatives include expanding mentoring programmes, improving communication between partners and associates, recognising the contributions and accomplishments of our attorneys, offering insights from our clients on best practices for associates, and providing opportunities for attorneys to connect in informal settings.

Our Women’s Professional Development Committee (WPDC) was established more than a decade ago to offer professional development programmes and guidance to women attorneys. The WPDC is comprised of partners (including a member of the Executive Committee), counsel, and associates, and receive support from our chief human resources officer, chief marketing officer, chief diversity and inclusion officer, and associate director of professional development. The WPDC highlights the accomplishments of our female attorneys, providing opportunities for networking at the firm and with other successful women across industries, and ensure that they are positioned to assume leadership roles during their careers.

In 2019, Willkie also introduced a Parents Group for associates at the firm. The group provides a forum for attorneys to share strategies and ideas about parenting and work-life integration. The Parents Group is planning programming to hear from experts on topics ranging from financial planning for families, time management, and talking with children about sensitive topics.

Long-term goals

We are particularly committed to continuing and further developing strategies to D&I on a long-term basis, including in the leadership ranks. In fact, today, 40% of members of our Compensation Committee are diverse and 40% are women. In addition, of the ten members of our global Executive Committee, 20% are women and 10% are diverse. Moreover, seven women and five diverse partners serve as department or practice group chairs or co-chairs, five women and three diverse partners or counsel lead firm committees, and three diverse partners and two women serve as office managing partners. Finally, from 2016 to 2018, our partnership classes have averaged approximately 36% women, respectively, and of the thirteen global attorneys elected to the partnership in 2019, five (or 38%) are women and four (or 31%) are diverse.

Willkie is deeply committed to creating and maintaining an inclusive environment by recruiting and retaining people of all backgrounds and cultural experiences. To that end, in mid-2016, the chairs of the firm charged the chairs of the firm’s Diversity and Inclusion Committee, Professional Personnel Committee, and Women’s Professional Development Committee to create the firm’s Task Force on Retention and Inclusion. The task force meets on a bi-weekly basis to collaborate on initiatives designed to retain, develop, and promote attorneys, particularly with respect to diverse and women attorneys at the firm. It focuses on an array of topics, including mentoring, work assignments, integration, partner accountability, annual reviews, and inclusive programming and reports regularly to Willkie’s chairs on progress and initiatives.

Working with clients

We welcome opportunities to partner with clients on D&I initiatives. In May 2018, we partnered with a client to host a panel on the business case for D&I. The panel was moderated by our chief diversity and inclusion officer and consisted of several of the client’s top female executives. In February 2018 we partnered with a client to host a panel on diversity, as well as a networking event for diverse law students in Willkie’s Washington, D.C. office. In addition, we presented a CLE on LGBTQ immigration rights at a client’s offices during Pride Month 2019 and we are currently partnering with a client to mentor foster children aging out of care.

Additionally, we’ve hosted programming that facilitates relationships between our women and diverse associates and clients. As an example, we partnered with four clients and invited diverse associates to host a Build-a-Bike event in our New York office, resulting in the presentation of new bicycles to 50 underserved children. In addition, the WPDC hosted a client networking event on International Women’s Day with women attorneys and clients.

We are always happy to share ideas with clients interested in our diversity and inclusion efforts. We welcome meetings to discuss our initiatives and how we can help clients implement them.

by Maria-Leticia Ossa Daza

‘My company has a very active diversity and inclusion group, with many different focus areas, one of which is women,’ says Erica Barbagalo, Bayer’s legal, patent, and compliance lead. ‘The aim is to enhance women’s participation in the company and in leadership positions, but mainly to ensure equal opportunities for everyone, regardless of gender. As such, our company has extended maternity leave, and also an extended paternity leave policy. Both offer more than the statutory minimum. We also offer flexible working hours.’

Anabell González Nava, legal director, North Latin America division at Arcos Dorados, agrees: ‘We implemented a programme, “Red Mujeres”, aimed at increasing the equity with women in our company. The programme focusses on developing initiatives in which we see opportunities to increase the number of women in key roles within the company, which has included implementing policies that ensure women have equity in salaries and compensation at the same level as men with the same responsibility.’

Schmitke, who was the first local leader on Zurich’s ‘gender pillar’ (part of their overall D&I programme, which started four years ago), points to several policy changes that have helped the insurer to attract and retain female talent. This includes extended parental leave (for both women and men), a milk room, and changes in the hiring process. Policy change and diversity ‘occurs in the HR function,’ she says, but ‘inclusion has to occur through the entire company, with all employees.’

Mauricio Rosillo Rojas, corporate vice president at Bancolombia says that companies are increasingly developing more policies favouring inclusion: ‘At Bancolombia, we are working to transcend the corporate environment in order to impact social structures through a transformation in our organisational culture, strengthening the competences for women’s empowerment, and providing support from the financial business to give a boost to the economic capabilities of women. We have set up a committee in charge of gender equality, and Bancolombia has also signed an agreement with the United Nations to achieve Sustainable Development Goals.’

Training and culture change

When approached in a positive way, formal or informal training can change how employees interact with each other, and in essence, change a company’s culture for the better. ‘To really implement D&I in a company or law firm, all employees must be educated and trained. It is pointless having more women on the board and more minority people in the company if they do not feel respected and included by their peers,’ Schmitke says.

“It is pointless having more women on the board and more minority people in the company if they do not feel respected and included by their peers.”

‘We are part of a global organisation, and we are subject to a set of global training, one of which is called “Be Bold for Inclusion”,’ says Guillermo Castillo, chief compliance officer at AFP PlanVital. ‘The objectives of this programme are to build an understanding and commitment to making progress on diversity and inclusion, increase insight into the beliefs and behaviours that are the main barriers to inclusion, and to increase confidence in how to lead change and walk the talk. Unconscious bias can be a huge setback in creating a truly diverse and inclusive workplace. We need to understand that employees need to feel comfortable and empowered to discuss diversity and inclusion in order to be more productive.’

For Castillo, this has positively affected how his team works together: ‘The rule is that everyone gets a fair hearing and has an equal chance to give their opinion; everyone can speak out if they notice bias in the team; and, most importantly, offer an apology if they get it wrong. We can only really deal with bias if we’re honest and admit our mistakes.’

Training is also an essential ingredient at Bancolombia, where women represent 67% of the workforce, and 57% of senior positions. ‘We want to ease conversations about the experiences and day-to-day life of women in corporate environments to define what gender equality means, what decisions we have to take, the behaviours that need to change, and all the processes we must change,’ says Rosillo. ‘In our organisation, we run a programme called ‘Me la creo’ (I believe it), which is focussed on removing bias and stereotypes and promoting female empowerment. Under the initiative, we provide online and onsite training for every team member, as well as a toolkit for those in leadership positions.’

Creating spaces where employees are comfortable enough to call out the bias they see is important in moving things forward. Barbagalo points out that she has ‘often seen unconscious bias in action – for example in several situations of performance evaluation, or promotion discussions’.

‘Sometimes I have had to point out that the “aggressiveness” identified in a woman professional was the same “straightforwardness” valued in a male professional. I have been able to point out on several occasions the fact that women are generally not well versed in self-promotion. I have also been able to point out the bias in women themselves – they don’t believe in their own capabilities, and don’t apply for more senior positions.’

Training in the form of mentorship is one of the most valuable ways to educate and effect change. Every lawyer we interviewed for this publication pointed to mentorship as a key element in their success. A lack of formal mentoring initiatives is not a barrier, however, as Ana María Delgado, vice president of corporate affairs at Corona in Colombia, explains: ‘At Corona we have created and actively promote spaces for women to share their experiences with other women, and I have personally committed to mentoring several young women with great potential.’

Bancolombia has developed a training programme with CESA, a well-known training institution in Colombia that works with high-potential women for boards of directors. It also uses its ‘Me la creo’ initiative to invite women in high positions in other local and regional companies to join them in the mentoring process. ‘It is important to us that our mentors and mentees have a safe space for the mentorship to occur, and where there is a certain level of affinity, comfort, and familiarity between them,’ says Rosillo. ‘We provide several open spaces where top management executives (both women and men) and other relevant attendees address their experiences, obstacles, fears, prejudices, challenges, and misconceptions surrounding this subject. The dynamic of these events is meant to be sincere, open, and without a hidden agenda because the purpose is to start creating an environment where this subject is addressed by every employee within the organisation, to make the whole workplace a safe place to raise your hand and discuss pros and cons, and have an open discussion without feeling threatened or constrained.’

Be the change you want to see

Barbagalo believes it is vital to act as a catalyst to hear the challenges coming from other women and to ‘voice them to the leadership. It is important not to lose opportunities, and to point to all the things that could be different to improve inclusivity, no matter how hard or how challenging. If it is the right thing to do, then it has to be done.’

The legal industry as a whole has a long way to go before equity and equality are achieved. There needs to be more women in leadership positions – both in private practice and in-house: that is undeniable. What we are beginning to see though, is the turning of the tide. With each year, we see more representation, more women role models, and more organisations and law firms turning their words into very visible actions. While there may still be a lot of room for progress, it does mean that, from here, the only way is up.

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Breaking Latin America’s glass ceiling

Over recent decades, Latin America has seen significant change in the makeup of its labour market. An increase in women’s representation and participation in the workforce, and organisational and various governments’ strategies are evolving to incorporate practices and initiatives to manage, enhance, and promote the role of women in the workplace. Foreign investment into the region is having a positive impact as demonstrated by the increase in Latin American companies adopting HR policies that go beyond legal requirements. That said, many Latin American countries and corporates still fall well short when it comes to opportunities for women and their economic participation. The gender pay gap remains significant. And despite the existence of legislation prohibiting gender discrimination, it still happens on a daily basis.

Why, in the 21st century, is this the case and how can meaningful change happen? Unfortunately, there is no single, silver-bullet cure for the gender disparity prevalent across the Latin America region. Change comes slowly, through education, by having uncomfortable but necessary conversations, and through the subtle shift of centuries-old biases that have kept one gender subordinate to another.

In a series of exclusive interviews, GC magazine speaks to senior and general counsel from across Latin America (both women and men) about how the more traditional landscape of the region plays a large role in how women are perceived in the workplace, and how they, along with their colleagues and companies, are slowly changing the experience for women lawyers across the region – but also for women in general.

Chauvinist society

For women working in Latin America’s legal industry (both in private practice and in-house), the challenge of getting ahead, of being ‘heard’, and respected, is two-fold. The legal industry is, and has long been, dominated by men, but that is hardly surprising when seen through the lens of a still largely traditional societal view that men work, and women stay at home. Anabell González Nava, legal director, North Latin America division at Arcos Dorados, says that even though organisations are making important diversity and inclusion improvements, ‘the culture of a society plays a key role in the habits and behaviours of men and women, and consequently of companies.’

‘Traditional gender roles are still very strong and create real and persistent inequalities among men and women in the workplace and in general in Latin American society,’ agrees Mexico-based Véronique Ramon Vialar-Déchelette, LatAm regional legal director at Publicis Groupe.

“Traditional gender roles are still very strong and create real and persistent inequalities among men and women in the workplace and in general in Latin American society.”

Valéria Camacho Martins Schmitke, LatAm regional general counsel at Zurich in Brazil, goes further. ‘Women pay a high personal price for equality with men. Some countries more, others less – but all are very chauvinist societies, and men still believe that taking care of children is a woman’s job. They also feel less empowered if their wives make more money than them. They expect women to be home when they arrive, and to prepare dinner. Women can work, but more as a hobby.’

These entrenched views have a serious impact on the industry, and how it is perceived. As Andrea Camargo, director of international legal affairs at Odinsa S.A. states in her profile interview in this publication, ‘It is a paradox that the profession in charge of providing justice is so full of inequalities.’

Despite these challenges, change – although slow – is happening. In interviews, several factors were highlighted as having a direct impact on the region: (i) a new willingness to discuss gender diversity and inclusion; (ii) a concerted effort from leaders to address challenges head-on in meaningful and practical ways, and to lead by example; (iii) the increase in men putting their heads above the parapet to argue that gender diversity benefits everyone, not just women; and (iv) the growth of multinationals, with more advanced diversity policies, establishing subsidiaries in the region.

On gender equality issues, Ana María Delgado, the Colombia-based vice president of corporate affairs at Corona, believes her country (which the World Economic Forum ranked as 40 out of 149 countries in its 2018 Global Gender Gap Report) has been evolving positively and that the participation of women in the workforce, as well as in leadership positions, has increased significantly over time. ‘Although there is still a long way to go, I have seen an increased willingness to openly discuss these types of issues,’ she says.

A recent country survey of Chilean in-house counsel showed that only 25% of general counsel positions were held by women. However, ‘statistics also show an increase in professional women’s careers with far more successful female roles and role models,’ says Guillermo Castillo, chief compliance officer at AFP PlanVital. While women hold only a small percentage of board seats and other influential positions, the pipeline of future leaders is starting to swell.

Zurich’s Schmitke is also seeing progress at a societal level, which will, in turn, have an impact on the Brazilian workforce: ‘I have seen men participating more in family tasks, with some men following their wives to another country because of her career. I believe that with every generation, we get closer to equality.’

Although she believes that Latin America is evolving more slowly than North American and European countries, Vialar-Déchelette says the region is walking the same path. ‘Private and public conversations regarding gender and equality are common, but quite recent,’ she told us. ‘These traditional prejudices need to be properly, widely, and honestly addressed and tackled so that public and corporate leaders understand their stereotypes and are willing to act accordingly to change.’

Tone from the top

The importance of strong leadership in tackling gender equality is a common theme. In her article, ‘How to get more men to take gender balance seriously’, for the Harvard Business Review (November 2019), Avivah Wittenberg-Cox argues that ‘it isn’t enough for the CEO to say gender balance is important once a year in a management conference. Nor even to set draconian and highly publicized targets… Until leaders are convinced that gender balance is a strategic lever for the business and become authentically and articulately convincing to their colleagues about why that is, balance remains a politically correct sideline.’

The 2016/2017 McKinsey report, Reinventing the workplace for greater gender diversity, supports the idea that real change must be led from the top. For women in the workplace to have better opportunities, to train and work in skilled and better-paying jobs, and to work in environments that support work-life balance and reshape social attitudes, organisations must challenge their fundamental and prevailing leadership styles and thoroughly re-evaluate traditional performance models. This is something that is particularly difficult for the legal industry, where the traditional structures and performance measures – such as billable hours as the primary measure of success – are inherently biased towards men.

The report goes on to say that organisations with a strong CEO and senior leadership commitment to gender diversity (i.e. those who place gender diversity as one of their top three strategic priorities) are twice as likely to integrate gender diversity successfully through all levels of their organisation. However, the report also shows that most organisations are falling short in transforming that commitment into a truly inclusive working environment, with many employees citing that they often don’t see words backed up by action, nor do they feel confident calling out gender bias when they see it.

Authenticity and ‘walking the talk’ are, therefore, key. ‘There are lots of good intentions, but not a real, open-minded approach to challenge the existing establishment,’ says Erica Barbagalo, legal, patent, and compliance lead at Bayer in Brazil. ‘The tone has to come from the top. The company needs its leaders engaged and acting as role models to succeed in promoting diversity and inclusion. It is not easy: changing the culture to break biases causes discomfort, and only courageous companies and leaders can bear that.’

Sometimes, it’s small gestures that have the largest impact as Barbagalo explains: ‘At a company event for hundreds of employees, the majority of them men, a guest speaker made a light joke about women. After his speech was over, one male leader got on the stage and explicitly disqualified the statement, making it very clear that this behaviour was not accepted in the company. He apologised for the insensitivity of the speaker. Needless to say, that speaker was banned from future events. Nobody, though, remembers the joke. But everyone remembers, to this day, the leader’s message.’

Diversity is a men’s issue

What came through loud and clear in all our interviews for this publication was the need to redefine gender diversity and balance as not solely the concern of women. For far too long, it has been accepted that fixing sexism is women’s work. But, actually, this is work that everyone must be a part of, because real gender balance has a positive effect for both men and women (see Michael Bruce’s interview in this publication for more on that topic). Wittenberg-Cox’s article states it clearly: ‘Companies whose balancing initiatives involve men are more than three times more effective than those focussing only on women.’

Castillo concurs: ‘Men’s partnership is required in addressing the issues that hinder women, including structural barriers and discriminatory practices that prevent women from participating on boards and receiving equal pay. Male executives can help lead the charge with women in enacting internal regulation that promotes benefits for women and men equally, and repealing policies that discriminate and limit women’s opportunities.’

Vialar-Déchelette believes the support of men is absolutely vital for change to occur: ‘Latin America is traditional regarding gender roles, and women on their own are making slow progress; thus the proactive support of men is necessary as a starting point. These are not just “women’s issues”; they are issues for the whole of society.’

What is key is how companies go about engaging with men on the subject of gender balance and equality to ensure maximum commitment. While this might be difficult for many women to read, Wittenberg-Cox’s advice is, essentially, to present the argument using ‘existing male-dominated hierarchies.’ In short, making the case for diversity based on moral grounds rarely has the desired effect. Instead, frame diversity as a business issue; make gender diversity and balance personal, measurable, and accountable. Position and normalise the issue as a business skill. Make male support the norm, rather than the exception. When the link between gender balance and positive business results is clear and explicit, men are more likely to engage with and support it.

“Position and normalise the issue as a business skill. Make male support the norm, rather than the exception.”

Another key factor is for more men to mentor women, and to be open to recognising their own biases (this applies equally to men and to women). Many of the women we interviewed across this publication spoke of male mentors whose support had a significant impact on their careers. ‘I have been very lucky to have great male mentors through my professional life. They have offered me support in changing career paths, in taking risks, and following my dreams,’ Delgado says. ‘Those decisions have helped shape and define who I am today, and I am very grateful.’

Vialar-Déchelette echoes the importance of male mentors: ‘I was very fortunate to have a modern and supportive chief when I was first employed as a paralegal in a major firm. He repeatedly said that if I wanted power, I just had to take it and not to wait for someone to give it to me. He constantly promoted me over the years, in discrete but effective ways, by teaching the profession and encouraging me to take huge responsibilities without questioning my capabilities as a young lawyer, as a foreigner, or as a woman. In fact, in a male-driven industry and firm, gender has never been a subject between us. He acted with me as if gender didn’t exist. I believe that this kind of mentoring over the years gave me the confidence to drive my career as I have wanted, without fear or self-limitation.’

International influence

There are many reasons attributed to why, in Latin America, there is a growing openness to discuss gender diversity challenges, why more leaders are waking up to the power of a diverse and gender balanced workforce, and why more and more men are beginning to vocally and actively support women’s advancement in the workplace. One of these is, of course, the growth of multinational companies, headquartered overseas, which are now opening subsidiaries across the length and breadth of Latin America.

Many of these multinationals go far beyond local legislative requirements (particularly on the gender pay gap, where legislation in some countries is still slow to come), and are putting in place progressive policies, particularly in regard to flexible working arrangements, maternity and paternity leave, and mentorship programmes. These companies are consistently outperforming their peers, particularly in their ability to attract and retain top talent. The policies are seen as reflecting a commitment to equality and serve as an indicator, to current and future employees, of a more inclusive culture.

Barbagalo says that ‘countries such as the US and some European countries have been discussing equality long before Latin American countries, and by establishing their subsidiaries in the region, these multinationals are able to promote their culture and also set examples – some have women CEOs or other high-ranking women leaders. There are, of course, local companies with high levels of awareness and actions towards gender equality and diversity, but they are the exception rather than the rule.’

And while, currently, it may seem that Latin America-domiciled companies are not as advanced as their overseas competitors when it comes to diversity, progress is being made. Many of the lawyers interviewed can point to success stories thanks to increased awareness and understanding of gender balance.

‘In many of the countries in which we operate, we have seen an increase in women in leadership positions,’ explains Nava from Arcos Dorados’ headquarters in Uruguay). ‘We have three women market directors in Martinique, Puerto Rico and Venezuela. We also have a woman sitting on our board, who is the vice president responsible for government relations.’

While these steps may seem small, they are significant, and show that the tide is certainly turning.

Michelle Obama, former First Lady of the United States, once said: ‘No country can ever truly flourish if it stifles the potential of its women and deprives itself of the contributions of half its citizens.’ And what is abundantly clear throughout this publication is that Latin America is not short on talented, strong, passionate, and determined women lawyers who have begun to pave the way for other women to follow. Despite the still patriarchal and entrenched views of women’s place in the world, these women are breaking glass ceilings. They have gone beyond merely boosting the diversity statistics of their organisations to prove that the acceptance and inclusion of women in the workforce – at all levels – has a significant positive impact, both on business and society.

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Foreword: J. Michael Bernard

Here at World Services Group, it is our pleasure to introduce you to the second in our series of GC special reports examining the present state of technology use by in-house legal departments around the globe.

Based on the stories and experiences shared as part of this report, there appears to be no denying that the use of technology in the legal sector is flourishing across Latin America. From blockchain-backed smart contracts to law firm relationship management software and everything in between, evolution is evident in all aspects of legal life – much of which is being driven by in-house legal departments. With positivity emanating and uptake rapidly increasing, the point of maturation for legal technology is not just on the horizon, but rapidly approaching.

As private practice lawyers, this means that we must also be at the vanguard of technological development. With the range of novel applications being implemented by forward-thinking counsel and their businesses, it is crucial that we understand the disruptive potential of technology in order to ensure that we remain relevant as trusted advisers in an ever-changing corporate environment. General counsel have made technology a business priority, which means that we must make it a business imperative.

Getting buy-in and leadership from all corners of the profession will be an essential component for long-term success. New solutions will require new thinking and, as the report reveals, implementing technology into legal functions is not always a straightforward matter. Considerations around the ethics of different innovations and the impact they can have on businesses and their legal departments is just one prominent example shared of the new challenges being faced by counsel of all walks. Oftentimes, these will have no clear and obvious precedent to follow, which speaks to the importance of engaging with members across the legal fraternity.

At World Services Group, we do not want to be passengers as our profession changes around us; we strive to be agents of change that help to facilitate progress. Partnering on projects like this provides us an opportunity to directly engage with thought leaders from across the legal world and glean insights into what the future of the legal profession may look like, as we collectively chart a renewed path for the practice of law and enable our member firms to add value for their clients.

Finally, I would like to extend my thanks on behalf of everyone at World Services Group to all of those who took the time to contribute their views and opinions as part of this project. The insights you’ve shared will undoubtedly ignite discussions and establish a dialogue about the impact technology stands to have on the legal sector – both in Latin America and further afield – but more importantly, help us all to consider how we can harness its potential for the betterment of everyone in our profession.

J. Michael Bernard

Chairman,
World Services Group

Equity Member,
Dykema

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An Honest Day’s Work

Since the beginning of the internet, the potential for technology to be exploited and misused has been a primary concern for policy makers. As technology has continued to expand and play an ever more prominent role in our everyday lives, these concerns have only broadened, becoming both more frequent and unique – and with each new technology comes a host of new ethical concerns.

As technology continues to evolve in the business world, while the legal profession may have been slow to adapt and progress, times are changing. The development of technologies such as machine learning and artificial intelligence are being applied to legal in an effort to reduce overheads, improve accuracy and boost efficiency. But despite the advantages legal tech brings, there remain concerns around technology and how it may implicate professional ethics.

In the research that underpinned this report, 18% of those surveyed said that implementing new technologies within their teams had raised ethical questions. On its surface, this would suggest that in the legal space, the use of technology was almost always done in an ethical fashion and didn’t raise concerns. But speaking in more detail with some of those counsel who had faced ethical issues painted a different picture, suggesting instead that many general counsel are not yet attuned to the new types of ethical questions arising.

Ethical by design

Just how technology is developed for, and used within, various legal functions is one source of significant ethical debate – particularly given the inherently secretive nature of the profession. One general counsel working in the banking sector, describes some of the ethical issues encountered with how legal software is applied.

‘In Brazil, we have a major problem dealing with the volume of mass litigation cases involving consumer and labour issues that we face. Here at the bank, we currently have over 120,000 active lawsuits.’

‘To help deal with this, I have software that allows me to access cases to find out what judges are doing, or have done, in cases related to my company and/or my competitors.’

Having software that enables counsel to quickly view other similar cases from the past is not revolutionary, but having cases analysed in order to provide suggested arguments according to the jurisdiction and the judge is.

‘The information is public, but this system can offer me suggestions on which versions of arguments would be best for certain judges. It can also help with predicting what may happen in my case.’

‘Using this, I can build a better defence or consider alternative options. For example, if the software revealed that I have a 70% chance of losing a case, I can use this information to propose that we may be better off agreeing to settle the case. Then, when it comes to working out a settlement, I have the statistical information that would allow me to know how many other similar cases have been settled. That provides me with the information that will help me decide how much money I should settle a lawsuit for.’

Using statistics and predictive capabilities in themselves is not inherently unethical, but the potential to build on this system in unethical ways is apparent. The potential for alternative sources of data that could be used to help build a better profile on judges and predict their behaviour is vast – social media is just one prominent example of this.

‘This kind of concern is being raised, but it is not a major concern right now. What may be an ethical concern is the data itself. The real problem arises only if you use confidential information, or if the data could be used to make correlations,’ says Marcelo de Araujo associate professor of philosophy of law at the Federal University of Rio de Janeiro.

De Araujo has worked closely with developing ethical protocols and codes for emerging technologies, including machine learning. He says that the data used to teach these systems can itself be an unintended source of ethical issues.

Using statistics and predictive capabilities in itself is not inherently unethical.

‘Machines can be influenced by human bias and emotions. If the original data is biased, the output delivered by the machine will also be biased. Machine learning will typically find out underlying patterns in the data set, a task that would take too much time and expertise for human beings to do unaided by AI systems,’ he says.

‘But if the original data set contains an unusual number of references to decisions that, for instance, marginalise black citizens, chances are that the prediction suggested by the AI system will reflect that kind of pattern.’

Alejandro Fernández R-B, head of legal at Cotemar, has grappled with similar issues.

‘In Mexico, when you have a labour case, mainly it’s because the former employee feels that he was entitled to receive a bigger compensation. Some cases, they are right; some cases, they are wrong.’

‘But the software might recommend that I can settle with them for a lower figure that they are entitled to. So, that is the ethical issue. Because in some part, I want to, and it’s my duty with the company, and on the other hand of course, I want to be fair with the former employees. So, that is an ethical issue that I am seeing as a result of this software.’

Show me the data

Since the implementation of the General Data Protection Regulation (GDPR), safeguarding data has not only been an ethical responsibility for general counsel, but a legal obligation. Many countries across Latin America have followed the lead of the European Union and aligned their existing regulations or introduced new laws around data protection.

Brazil’s suite of data protection laws are set to come into force in August 2020. The Lei Geral de Proteção de Dados (LGPD) stands to have a marked impact on business and broader society, with protections possibly set to be enshrined in constitutional law in the future.

‘The public at large increasingly perceives the protection of their personal data as a pressing question. There is now a new bill for an amendment to the Brazilian Constitution that would turn the protection of personal data into a fundamental right,’ explains de Araujo.

‘Most citizens seem to be aware that they are giving away too much personal information online, and that it is far from clear what private companies are currently doing with their personal data. Over the last few months, there have been reports of two cases of technical failures which compromised the personal data of 28,000 citizens in one case, and 70 million in another case.’

Fair and Available

There are a number of ethical rules that apply to general counsel, irrespective of technology. However, as legal tech becomes more prevalent, new ethical dilemmas begin to arise. In Brazil, AI tech is being introduced to reduce the time it takes to settle disputes.

‘The Brazilian supreme court announced in 2018 that an AI system called Victor was being tested in order to speed up court decisions,’ says de Araujo.

‘Currently, the court may take as many as ten years to settle a dispute. Many citizens die before they can obtain the benefits of a favourable decision.’

Victor is an artificial intelligence tool developed in partnership with the University of Brasília. The AI software is designed to process thousands of court decisions already made and identify links between cases. By identifying and analysing previous precedents, the aim of Victor is to increase the speed of legal proceedings through the development of neural networks. Technology has the potential to play a major role in improving legal services in Brazil, but de Araujo believes that algorithmic bias needs to be accounted for.

‘There has not been much public discussion on how Victor is supposed to deal with algorithmic bias. Speeding up court decisions would be a huge improvement in the Brazilian legal system. But quicker decisions will not promote justice for ordinary citizens unless unjust patterns of decision-making in the past are also avoided in the future. For now, it is unclear how the Supreme Court intends to address this issue.’

To avoid transferring prejudicial precedent to future cases, more oversight and transparency within machine learning services is required.

Says de Araujo: ‘The problem could be addressed by examining what exactly the system is doing as it provides scores for risk assessment. But developers may be unwilling to make their AI systems more transparent. They fear that, by making the system more transparent, other developers might take advantage and copy their technology.’

In both of these cases, the culprit was a government institution, heightening public awareness of data-related issues at a time when business is preparing for increased scrutiny with the introduction of the LGPD.

‘As a banking service, we provide credit cards to a lot of our clients. Using this data, I could learn, for example, that a client of the bank is going to the beach every weekend, because they buy something on the way there,’ says the banking GC.

‘The specifics of what you buy is information that is protected by law, but a bank could use other information from the transaction to try and sell the client a product. For instance, you could contact the client to try to sell them travel insurance, because you know that this person goes to the beach every weekend.’

Equally, it could be said it would be unethical if a bank were to use this information to discriminate against a client by developing assumptions based on spending patterns.

‘People who go to the beach every weekend could be discriminated against if I make a correlation with something else that affects their credit score. The client could call the bank and ask, “Why is my credit score affected?” Right now, if I say that our system says you go to the beach every weekend and your salary is $1,000, therefore you probably cannot pay your bills, we would face problems,’ explains a GC in the financial sector.

‘If we make a lot of correlations like this, we can face problems. This kind of model can become so sophisticated – it deals with a lot of data and one of the dangers is that this data could trigger a warning that says this person is a good or bad client for the bank. I think we could face real problems in the future.’

In order to address the potential for making such ethical and legal breaches, banks across Latin America have implemented measures to limit data access across a company.

‘We have a specific department here at the bank comprised of lawyers, software engineers, operations people and risk analysts. They analyse and see the flow of all data in the company and check to see if the information is sensitive or if it must be kept confidential,’ he says.

‘This team applies the law in order to protect the information of the people linked to these types of risks. I think we have this department in the bank after the implementation of the GDPR law and we are spreading this culture of data protection in banking – we are not only compliant to banking secrecy law, but for data protection. There is still a lot to do, but the bank is in a good shape’.

In the future, the implementation of new technology will only continue to make data collection and analysis more sophisticated and complex. Data protection has always given rise to ethical concerns for corporate counsel, but technology has made data security a major point of concern. With data breaches gaining global attention, some general counsel in Latin America believe that it will only be a matter of time before stricter global controls are implemented.

‘I really believe these types of regulations will become global at some point. Maybe the United Nations or another global entity will try to implement regulations that are more globally focused, but I would guess that, regardless, the principles surrounding data protection will all be the same,’ says Pablo Enrique Urrego Hernández, head of legal at Diageo Colombia.

Will Siri practice law?

Separate to the ethical concerns raised from algorithmic bias and data protection are the fears surrounding legal tech’s potential to replace lawyers.

‘Some people believe that there is an ethical discussion surrounding legal software that could attempt to destroy the value lawyers bring,’ explains Urrego Hernández.

‘If you develop software that could replace lawyers, then essentially a lawyer could be replaced by a machine. The idea of technology is not to be viewed as a risk to job opportunities, but instead as a tool that could help lawyers focus on tasks that are much bigger and add more value.’

Despite the way legal tech is viewed, its potential to be an industry disrupter is generally accepted. Of the more than 200 general counsel surveyed across Latin America for this report, 84% thought that technology would be a moderate to great disrupter over the next five years.

‘What will probably happen is that systems will be so highly developed and so detailed on what we want them to do, that tech will probably not take into account any human emotion. There are so many factors and possibilities that could be used to create a system that could probably emulate repetition, but, in the end the human factor is key,’ says Urrego Hernández.

‘At the moment, there is not true artificial intelligence – I do not know whether this could change in the future – but, up until now, there has been no system that can replace human behaviours and ways of thinking.’

Legal tech across Latin America, like much of the world, is still in its development stage. Most of its implementation has revolved around low-level work but, as technology continues to develop, the issues that could be raised by legal tech are still fundamentally unknown.

‘Experience has taught me that while you develop these things, you start seeing issues you have never seen before, and there is no doubt that the future of legal tech will present many barriers that will need to be addressed. At the moment, what we need is to be objective, although imagination is powerful and out-of-the-box thinking is good,’ says Urrego Hernández.

‘The list of ethical concerns that could be raised by new technology is extremely extensive. What should happen is that ethics should be part of your life. At the end of the day, ethics should be one of those main considerations that you have to take into account in every aspect of your life.’

Whether in-house counsel across Latin America resist or embrace technology, legal tech will inevitably transform the delivery of legal services, though not without a host of other issues to contend with. Ethical conduct will remain pivotal to ensuring the legal profession remains independent, effective and accountable.

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Data Analysis Part One: Size matters

In-house legal teams come in all shapes and sizes: some companies will have small teams, preferring instead to outsource the bulk of their work to external firms, while others have internal legal departments that would outnumber many major law firms. For the purposes of the research that underpinned this report, a small legal team is classified as one with ten or fewer members, while a large legal team is one with more than ten members.

Of the 140 people who participated in our research, 65% of those were from small legal teams, with the remaining 35% coming from larger teams. The attitudes, ability and budgets of these two different groups had a number of notable differences – and not always in the way one might typically expect.

While our research showed that the overwhelming majority of all legal teams in Latin America used specialised legal technology in some form within their department at 96%, the few that didn’t all came from respondents from small legal teams. How that technology was used was relatively similar between the two different groups in most areas – use for factors like contract management, human resources and law firm relationship management was nearly identical. Where large teams did differ was with case management and dispute resolution, where large legal teams were nearly twice as likely to use specialised case management and dispute resolution technology.

The vast majority of our respondents held a positive outlook on the extent that they believed technology could enhance outcomes for in-house departments, with 66% of all respondents believing it can enhance to a great extent and 31% to a moderate extent. Those from larger teams, however, retained an even more upbeat stance than their smaller counterparts: 85% of those from larger legal teams believed that technology could enhance outcomes to a great extent, compared to 56% of those from smaller teams.

Larger teams were also more likely to have a positive outlook on how their department fared compared to their peers. While the majority of small legal teams retained a positive outlook, at 55%, that number was dwarfed by large legal teams, where 70% said they thought that their department’s use of technology compared favourably with other companies.

Interestingly, while small legal teams were much less likely to have received an increase in their technology budget over the last five years compared with their larger counterparts, that didn’t necessarily translate to feeling unsupported by their company when implementing new technology. While only 52% of small legal teams had received a boost to their budget, 90% of those we surveyed from small legal teams felt that their company was supportive. Compare that to larger legal teams, where 74% had received an increase in their tech budget, but only 78% felt that their company was supportive.

Based on the interviews that complemented the quantitative component of the research, the reasons for in-house legal teams feeling supported by their companies were more nuanced than simply being given the green light to purchase new services. Getting buy-in from the wider company was important to a number of those who we spoke with, with a range of factors noted, including assistance with integrating legal systems across the wider business.

While artificial intelligence remained a rarity in legal departments across Latin America, it was currently being used almost exclusively in large legal teams. Those we spoke to who utilised AI tended to have legal teams that were at the top end of large – with upwards of 50 members on their team – and were primarily utilising it in order to either reduce the more menial tasks their businesses required from legal, or to assist in departments that had large amounts of litigation and disputes work.

That attitude broadly aligned with the reason behind technology implementation. Between the two groups, what was most important when considering legal tech was one area where there was a difference. While smaller teams were mostly concerned with using technology to improve the quality of their work, at 69%, those from larger legal teams were less likely to value improvement of quality, at 57%, and put a higher priority on using technology to reduce costs.