Shawn Zhao, VP and general counsel Greater China, Schneider Electric (China)
Q: What are the emerging legal trends in your industry?
A: I have actually worked at two manufacturing companies in the past few years and I have observed there is a transformation from the brick and mortar products to connected products because the companies are all trying to make sure their products are actually connected; smart products that can actually be managed by a software platform that will be able to manage the input and an incoming and outgoing data. The consumer products will be able to do things much more than they were used to do.
The electronic data that is coming back and forth will make sure the consumer will understand. For example, what food needs to be replenished and whether their diet is healthy or not in daily life. For industrial customers, they will be able to remotely diagnose some of the problems they have in their products and systems and sending it to the manufacturer so they can actually provide solutions via Internet of Things. This is really the big trend that I have been observing. This created some interesting consequences. For example, for people at the in-house legal team, they will have to think about, “Okay, we have this data, how do we manage it? How do we make sure it’s compliant with the local laws and regulations?” And if you are running a multi-national operation, how do you make sure the data protection is compliant with the international or laws of another country governing data privacy or cyber security? This will add another dimension to the in-house legal work. And therefore, we have to make sure that we have the expertise. We have people who are basically digital savvy and we want our employees, not only our legal team, but also everyone in the company, to be the digital citizen. That is the trend that is being emerging in the manufacturing industry.
That also kind of impacts the legal team functions and how we, as legal managers, manage our teams. For example, you will have this if you feel running a multinational operation. Obviously, the employee data and also the customer data may be transferred cross-border. And how do you do that? How do you make sure that the transfer is compliant with the laws of the home country versus the country where the data is flowing to? There will be a difference in the sophistication of the legal system between the two countries. What do you do? Normally, for companies like ours, our approach is to set a higher standard to stick with instead of settle for the less.
This also leads to another interesting phenomenon. Our lawyers will have to work with different functional groups, with IT, business, government relations, and public relations. And therefore, these groups will eventually be involved if something happens. We need to learn how to collaborate with them and how to deal with ambiguity because the differences in law of different jurisdictions creates ambiguity. Working with other teams that you were not used to work with also creates some ambiguity in terms of roles and responsibilities. I would always encourage my team members to take a step forward rather than take a step back.
Q: How do you structure and manage your team?
A: My core team basically takes care of commercial contracts, supporting our business lines of business, we call it the BUs (business units). My approach is usually to assign a dedicated support to each BU so there is a sense of ownership on the part of the in-house counsel because they know where their client is. The client also does not have to really figure out this issue; “Who do I go to? Which lawyer is in the team?”. There is a sense of team as well on their side. Other than that, we have someone takes care of compliance and we have a litigation team and we have merger and acquisition team.
I think we are actually doing a lot of work to make sure that there is collaboration amongst our own team as well as between our team and teams of other jurisdictions, in-house teams. We have built sort of online platform called collaboration site which we will be able to do that, where you want to discuss something of common interest or where you are sharing some experiences or templates amongst the teams.
Outside of the legal team, we leverage WeChat, apps like WeChat, because for millennials, they are very much carrying the app with them and flipping through all the pages while they are on the go. So, if we want to get their attention, if we want to be part of their day, then we have to reach out to them. We actually have WeChat enterprise account so that we can actually put out a lot of our guidelines, templates and also very short, snappy, good, interesting articles to tell them about certain legal issues and kind of inform them on the latest legal development in a form that will be very interesting to them. Not only just the dry legalese, but also with the artwork, graphics, very vivid artwork so that we will be able to get their attention. And we have seen the clicks on such articles climbing up significantly.
This interview was conducted during the CBLJ Forum at Grand Hyatt Hotel, Shanghai, on 12 November, with the theme “Seizing Cross-Border Opportunities – Managing Global Risks”. For more information about the conference and videos of the forum sessions, please visit our CBLJ Forum 2019 webpage here.