The Asian Infrastructure Investment Bank’s general counsel, Gerard Sanders, talks to John Church about his unique role in building a legal division and helping to chart the bank’s course from the ground up
Building a major bank from scratch is a monumental exercise. Fundamental to construction, and more important than bricks and mortar, are the legal platforms and parameters that form the institution’s charter and instruct its day-to-day financial operation. Throw in the fact that the bank is dealing with multiple jurisdictions, and on projects with the potential to change the lives of millions, and you have a glimpse of the weight attached to the work of one of the region’s busiest general counsel. Gerard Sanders took on the job as general counsel with Asian Infrastructure Investment Bank (AIIB), and a change of scenery from Europe to Beijing, where he is now based, in August. The quietly spoken New Zealander saw the move as somewhat of a natural progression – a new challenge, and perhaps even the pinnacle of a career that has stretched both his legal and leadership potential.
A younger Sanders gained early and broad-based commercial experience in a private-sector law firm, Simpson Grierson, in New Zealand. That was followed by litigation experience and work advising governments in Washington DC with Arnold & Porter, and then a stint with British petro giant BP for two years.
This private-sector and in-house experience laid the platform for a move to the European Bank for Reconstruction and Development (EBRD), followed by two years with the UN’s International Fund for Agricultural Development (IFAD).
“By the time I came to the AIIB I had this experience I could draw on, including many years in the field of financing development, and experience as a GC for an international organization,” he says. “That’s given me the confidence to be able to work in this institution, and it helps that the charter is familiar. The AIIB’s articles of agreements are modelled to a significant extent on the charters of the ADB and the EBRD.”
The big attraction of the job is that it is a start-up. “Here, everything is new, even the strategic direction over the next three or four years is something that has to be nailed down a bit more. So it’s fun to be part of an institution where you get to help shape policies, to staff the legal function the way you want, and you are able to try and determine the legal culture, the degree of legal risk taking you want to take, and so forth. That’s all part of the daily job.”
Sanders’ insights into this massive undertaking provide an illuminating picture of the internal machinations of a major lending institution in Asia from the point of view of a talented in-house counsel building a legal team from scratch. “Christmas day was the day the articles of agreement became effective, and in mid-January it became operational,” he says. “At that point there was a cadre of people associated with the secretariat who continued on to provide some short-term consultancy services, and some became staff.
“That was not the case in the legal division. I’m the first regular employee, and there are three other regular staff who have since joined, a German –a Briton and a Chinese national. So we have a good balance of people within and outside the region – remembering that New Zealand, where I am from, is part of what is understood as the Asian region at the bank.”
Sanders says the division was assisted through support from secondees, some lent to him by the World Bank, the Asian Development Bank (ADB), the European Bank for Reconstruction and Development (EBRD) and others. “Of huge help was the work that was done by the lawyer Natalie Lichtenstein, who did a tremendous job in helping to craft the charter and steering it through successive negotiations,” he says. “So that’s the legal division; we’re currently putting together our budget for next year. Obviously we’ll grow quite a lot, but the idea is to have planned growth.”
For the institution as a whole, Sanders says there will probably be about 80 staff members by the end of this year. He says the organization began by trying to staff senior people first, who then shouldered the responsibility for putting together their different departments and divisions. “That’s now happened not only with the appointment of the president and the vice presidents, but also those at the D-G [director-general] level as well, apart from two or three open positions.”