Australian Corporate Lawyer - Summer 2018 by Association of Corporate Counsel (ACC) Australia

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acla.acc.com SUMMER 2018, Volume 28 – Issue 4

The official publication of

Meet the 2018 In-house Lawyer AWARD WINNERS

TECHNOLOGY THE OPPORTUNITY FOR LEGAL INNOVATION DIGITALISATION, TECHNOLOGY AND INNOVATION ARE CHANGING IN-HOUSE LEGAL TEAMS SIX STEPS TO OVERCOME RESISTANCE TO TECHNOLOGY CHANGE 1 VOLUME 28, ISSUE 4 – SUMMER 2018 |

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VOLUME 28, ISSUE 4 â&#x20AC;&#x201C; SUMMER 2018

theAustralian

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Volume Number 28 Issue Number 4

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REGULARS

Editorial Editor: Andrew McCallum T: (61) 3 9248 5548 E: a.mccallum@acc.com

PRESIDENT’S REPORT

PERSPECTIVES Adrian Goss

A DAY IN THE LIFE Rembert Meyer-Rochow

ACC GLOBAL UPDATE

F E AT U R E S 8

THE OPPORTUNITY FOR LEGAL INNOVATION: WHY THE GENERAL COUNSEL IS FIRST AMONG EQUALS

CHANGES IN THE LEGAL MARKET VIA DISRUPTIVE TECHNOLOGIES

STATE OF THE AUSTRALIAN LEGALTECH MARKET FOR GENERAL COUNSELS

DIGITALISATION, TECHNOLOGY AND INNOVATION ARE CHANGING IN-HOUSE LEGAL TEAMS

THE 2018 IN-HOUSE LAWYER AWARD WINNERS

TECHNOLOGY AND TRANSPORT: MOVING YOU IN(TO) THE FUTURE

SIX STEPS TO OVERCOME RESISTANCE TO TECHNOLOGY CHANGE

DEVELOPMENTS IN LITIGATION TECHNOLOGY: EARLY SLEUTHING AND SCOPING

Journal Sponsorship and Advertising Are you interested in reaching 4,000 ACC members Australia-wide? Please contact: Andrew McCallum T: (61) 3 9248 5548 E: a.mccallum@acc.com If you are interested in other sponsorship opportunities with ACC Australia, please contact: Ingrid Segota T: (61) 3 9248 5511 E: i.segota@accglobal.com Letters to the Editor You are invited to submit letters to the editor by email: a.mccallum@acc.com Articles for Publication If you have an article you would like to submit for publication, please contact: Andrew McCallum T: (61) 3 9248 5548 E: a.mccallum@acc.com Contributions are included at ACC Australia’s discretion and may be edited. General Enquiries T: (61) 3 9248 5500 E: ausmembership@acc.com W: acla.acc.com Publisher The Australian Corporate Lawyer is published by the Association of Corporate Counsel (ACC) Asia Pacific.

THE BLOCKCHAIN: HYPE OR REVOLUTION?

TIGHTER HIRING LEAVES LEGAL DEPARTMENTS SEEKING REVOLUTIONARY SOLUTIONS

Disclaimer The opinions, advice and information contained in this publication may not be shared by ACC Australia. They are solely offered in pursuance of the object of ACC Australia to provide an information service to corporate lawyers.

The Association issues no invitation to any member or other person to act or rely upon such opinions, advice or information and it accepts no responsibility for any of them. It intends by this statement to exclude liability for any such opinions, advice or information. Readers should rely on their own enquiries in making any decisions which relate to the content here.

VOLUME 28, ISSUE 4 – SUMMER 2018 |

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PRESIDENT ’S R E P O R T

theAustralian

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acla.acc.com SUMMER 2018, Volume 28 – Issue 4

The official publication of

Meet the 2018 In-house Lawyer AWARD WINNERS

that is no different when it comes to technology. Many legal teams throughout the country are adopting tech to change the way they support their organisations and are doing so successfully.

Karen Grumley National President

remember (in my relatively short career) partners who didn’t have computers on their desks—let alone in their pockets. Now, as I receive hundreds of emails each day, I often think that life was much easier when Apple and Blackberry were just fruits. But then, I ponder how innovation drives success, and what technology has to offer my practice as an in-house lawyer.

This edition of the Australian Corporate Lawyer magazine is investigating the impact of technology on the in-house legal profession and the law in general. The technological upheaval of the last decade is undoubtedly facilitating different business models across almost every industry. That disruption, together with the arrival of new tools and the advent of automation, is transforming the way that legal work is undertaken. I spend much more time today thinking about how to provide legal services more efficiently, than at any other time in my career. And I look to technology to enable me to provide faster, better and cheaper legal support for my organisation. But many of us were trained as lawyers when dictaphones were the leading tech tools. Today, universities are preparing students for legal careers during a time of digital disruption—educating them on how to understand and leverage technology. Technology has upended predictable career paths and is changing how, for whom, with whom and on what terms many lawyers work today and into the future. Simply, technology is changing what it means to be a lawyer. I’m proud to say that I believe in-house legal teams are innovators—trailblazers in our profession. And

If you’re not one of those teams, how and where do you start? This has been a focus for us at ACC Australia over several years—building resources for our members to share their experiences with using and adopting technology. To this end, we have built the LegalTech Corner, accessible on the ACC Australia website and full of useful information. Alternatively, attend our educational and professional development sessions focused on learning from other trailblazers, such as that presented by Jodie Baker, Deputy Chair, Australia Legal Technology Association at the National Conference on ‘How to Build a Legal Technology Roadmap’, a topic also featured in this issue. But technology is not only enabling us to change the way we practise law—the law is having to change to reflect technology. As revealed in the ACC Foundation: State of Cybersecurity Report (2018), chief legal officers are increasingly being called on to guide their organisations and aid with thwarting cyberattacks—something that may not have been a challenge for many of us ten or even five years ago. The fact that many of our organisations are engaging in disruptive business practices inevitably means we are having to think about the law differently, or delve into areas of the law where we may not have traditionally practised. I hope that your ACC Australia membership provides you with the tools and resources necessary to get ahead of these new challenges. Whether you believe that technology is the catalyst for change or is an enabler of change, I come back to the adage that where change is inescapable, you either ‘lead, follow or get out of the way’. I am of the opinion that if you want to be involved in shaping the future of the in-house legal profession, you are going to have to lead— and the future of our profession is going to be driven by technology. Mahatma Gandhi is celebrated for saying, ‘Be the change you want to see in the world’. I want to be tech-savvy, so I’m going to turn the page and read on. a

On behalf of the ACC Australian board and staff, we would like to sincerely thank our members and supporters for their valued support throughout 2018 and wish each of you a safe and enjoyable end to the year. Inside this issue of Australian Corporate Lawyer please find a Christmas gift tag. As always we encourage and hope our members recognise and utilise the value of ACC Australia membership and that you’re comfortable recommending ACC Australia membership to your friends and colleagues. The gift tag, which is ideal for ‘Secret Santa’ gift-giving includes a unique discount code ensuring the membership joining fee is waived for the lucky recipient. Thank you again for your support and we look forward to seeing you in 2019! 4

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ACC AUSTRALIA BOARD President Karen Grumley Pacific National Vice President Justin Coss AUB Group Limited Immediate Past President Gillian Wong St Barbara Limited Company Secretary Rachel Portelli Intensive Group Pty Ltd Directors Mary Adam Department of Local Government, Sport and Cultural Industries (WA) Sandie Angus Queensland Treasury Anna Bagley Programmed Group Limited Teresa Cleary Australian Institute of Company Directors Sayuri Grady Department of the Prime Minister and Cabinet Valerie Hodgins Metropolitan Redevelopment Authority Theo Kapodistrias University of Tasmania Scott Long University of Adelaide Lori Middlehurst VMware Mei Ramsay Medibank Private Limited Edwina Starck Pernod Ricard Winemakers Kate Stewart Department of Industry, Innovation and Science

Membership 1300 558 550 PO Box 422 Collins Street West Melbourne, VIC 3007 acla.acc.com

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PERSPEC TIVE S ADRIAN GOSS

’m writing this from Austin, Texas, where the ACC’s 2018 Global Conference (a.k.a Annual Meeting) is winding up. The conference is an extraordinary gathering of around 3,000 in-house lawyers from across the globe. Unsurprisingly, many of the sessions dealt with the way in which technology is having an impact on the practice of law in-house, and the vast exhibitor hall was packed with legal tech providers. The pace of technological change in our sector, the legal industry, is both excitingly rapid and frustratingly slow. It’s been a decade since Richard Susskind wrote The End of Lawyers?, and many of his predictions are only now manifesting in-house in a mainstream way. There’s little doubt that corporate law departments have contributed to, and will increasingly contribute to, the pace of adoption of new technologies in the legal sphere—we have fewer incentives than law firms to perpetuate inefficiency, we don’t have the ingrained conservatism of the bench and bar and can influence others through our buying power. Nevertheless, three factors limit that pace. First, resourcing issues present significant obstacles. Getting the attention of our IT teams is challenging as they focus, rightly, on revenue-generating areas of the business and easily quantifiable wins in cost management and business effectiveness. Similar issues arise in relation to budgetary allocations. Appreciating those issues, we need to become better at identifying and quantifying opportunities to realise efficiencies in our legal operations and in engaging with and leveraging the expertise of our IT teams. We also need to search out opportunities for utilising existing business tools by the legal team. Second, there is a lack of objective information on the multitude competing technology solutions. It remains the case that almost all of the information that is readily obtainable in relation to a solution is provided by the vendor of that solution. This challenge is compounded by the dynamism of the legal tech industry, which is constantly seeing providers disappear or merge, and new providers enter the market. The ACC has a valuable role to play in creating formal and informal opportunities for benchmark solutions and for in-house lawyers to share their experiences regarding those solutions. At a structured level, the ACC’s conference programming goes some way to achieving such solutions, as do opportunities to engage with colleagues. I will leave Austin with two strong recommendations from General Counsel, for two separate IT solutions that I intend to look into.

Third, our own expertise and approach hold us back. We tend to have relatively little experience in procuring, implementing and deploying technology solutions. We also tend to be relatively conservative and sceptical. For larger teams, these shortcomings can be addressed by engaging legal operations professionals. For smaller teams, it is more likely a case of improvising, challenging fixed mindsets, finding small wins and leveraging relationships with technology vendors. We each need to become more competent at identifying opportunities for efficiencies in our legal teams through technology and its implementation. An analogy that was recently put to me compared changes in our work environment, particularly in relation to contract negotiations, with changes in the environment that pilots work in. That is, like pilots, the tools we use are becoming increasingly automated with fewer necessary manual processes. In such a scenario, our role changes from actively ‘flying the plane’ to utilising technology to set flight parameters, making higher-level decisions and intervening when things go wrong or the unexpected arises. An example is the increasing sophistication of document review technology. We’ve probably all had the experience of issuing an agreement as part of a tender and having multiple different tenderers, all in a similar position, respond with largely inconsistent proposed amendments. That experience highlights the very human and relatively arbitrary nature of contract review. Software that does a ‘first cut’ of a document, comparing it against a set of predetermined standards and redlining it to highlight departures from those standards, has the capacity to remove much arbitrariness. In addition to improving consistency and accuracy, it can dramatically reduce the time taken by a reviewer. Such software is already very effective and will become increasingly so. In-house lawyers who fail to embrace technologies of such nature will be left behind.

Adrian Goss As General Counsel of Bauer Media, Adrian is responsible for the company’s legal and regulatory function across Australia and New Zealand. During his almost 20 years of practice, Adrian has focussed on corporate and commercial matters as they affect broadcast, print and digital media businesses. Adrian is a former National President of ACC Australia. He has recently joined ACC’s global Board of Directors.

Each month ACC Australia invites our in-house industry leaders to share their experiences and perspectives on the theme of the current issue of the Australian Corporate Lawyer.

By way of postscript, two of our own , Anna Loszynski, General Counsel, L’Oréal and Verity White, Legal Counsel, Telstra, have recently published e-books on innovation in the in-house space. Both books are practical and challenging, and it’s brilliant to see this level of thought leadership within our community. Anna’s Legally Innovative: How to Maximise Your Legal W.O.W [Ways of Working] is available via issuu. Verity’s Legal Innovation Framework: 4-step Plan to Bring Great Ideas to Life is available via the Legal Innovation and Tech Fest website. a VOLUME 28, ISSUE 4 – SUMMER 2018 |

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A DAY IN THE LIFE REMBERT MEYER-ROCHOW Director & Senior Corporate Counsel, Autodesk

Rembert Meyer-Rochow Based in Singapore and currently serving as a Director & Senior Corporate Counsel with Autodesk, a US-listed technology company, Rembert has extensive experience working in the technology industry. He has previously held in-house roles with Intel Corporation and has also practiced law in New Zealand, Australia and Hong Kong.

6:15 am

I wake up before my alarm clock goes off (which was set for 6:30 am). I quietly sneak out of the bedroom, scan emails on my mobile phone for anything of high priority that has come in from the US overnight and take a quick look at the key news headlines on CNN. com.

6:30 am

I get the kids out of bed and get their breakfast ready—usually something quick and simple, like boiled eggs and toast with Vegemite. What follows is a mad scramble to get myself showered and ready, get the kids dressed and packed for school, a quick goodbye kiss for my wife, a cuddle with my dog Paolo (whom we adopted when we lived in Hong Kong), and then getting everyone outside. The school bus arrives at 7 am, which also coincides with my first conference call of the day.

7:00 am

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My first call today is with a team of legal and business colleagues on the operation of our e-stores in Asia. Some team members have dialled in from our San Francisco office and some are already in transit on the way home. During the course of this call I will have walked to the bus stop, taken the bus to my office, been careful throughout to stay on ‘mute’, though unmuting occasionally to make a comment.

7:30 am

I am now at the café in the lobby of my office. I order a flat white and plan to spend the next half hour in the café responding to emails. However, I spot a colleague from our Australian office who has just arrived in Singapore, so I join him for an informal catch-up chat.

8:00 am

I am now in my office. I have a 1-hour weekly call to update with my boss, who is based in San Rafael. I use this time to update him on key issues in the APAC region. As usual, he probes me with questions and also provides insightful thoughts and guidance. He also briefs me on various corporate strategic initiatives that have implications for the countries I cover.

9:00 am

My next few hours are relatively unstructured. I say a quick hello to my legal colleagues in the Singapore office and get an update from our ASEAN counsel on a matter related to our software distribution in Indonesia. I find myself having to prioritise numerous types of communications coming my way, all competing for my attention—emails, instant messages, skype calls, SMSs, phone calls etc.

10:50 am I usually have an ‘open door’ policy (the exception being when I am on the phone or need some time to focus on an issue) and colleagues sometimes drop by for a quick chat if they see I am available. Our APAC Government

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Affairs Director, who is also based in Singapore, walks past and steps in. We have a conversation about the escalating trade dispute between the US and China, and the possible implications for multinational software companies operating in China. 11:00 am I commence a 1-hour video call with our global head of litigation and compliance, who is based in the US. He calls from his home office and prefers this timeslot, as it is after his evening dinner (which he cherishes with his family). The call starts with his daughter making an impromptu appearance (she is always enjoys saying hello to people ‘on the other side of the world’) and then he closes his office door and we are under way. 12:00 pm I head to the gym which is located upstairs in our office building, and spend 45 minutes on the step machine. I bring my headphones along and listen to a pre-recorded company-wide business briefing from our CEO. On the way back to the office, I buy some fruit from a vendor with a stall outside our building. 1:00 pm

1:45 pm

I recently attended a team building event, where an expert taught us about the benefits of meditation. I sit at my desk and do a 5-minute mind-relaxation exercise before proceeding with my workday. I have a call set up for 1:30 pm with the CIO and the legal counsel of a company based in Hong Kong, on an issue related to the licensing terms of our software. I review my notes on the matter and draft an outline of the conversation I plan to have, along with a negotiation strategy on the various points that I anticipate will be raised. I make a quick call to a newlyhired member of the APAC legal team in Korea, checking in to see how things are going. We briefly discuss some of the issues she is working on. It can be challenging for newer legal team members to get up to speed on all relevant issues while based in a remote location. She’s doing fine. I give her a list of suggested tasks for the coming week designed to help with her onboarding.

2:00 pm Our APAC weekly sales forecast call commences. The country sales directors across the region provide business updates to our APAC head of sales. I multitask, responding to various emails in my inbox, always remaining alert for any issue raised in the forecast call that may have legal implications. Our China sales director mentions a deal that is being ‘held up by legal’. I send an instant message to the head of our China legal team asking for a quick update. 3:28 pm Just as the APAC sales forecast call finishes, I get an incoming video call from my wife. She gives me a quick glimpse of our daughters who are now warming up at gymnastics training. I watch the girls stretch for a few minutes. 3:30 pm Our Australia counsel has been pinging me throughout the day, asking if I am free to chat. I am conscious that Sydney (which is 2 hours ahead of Singapore) is heading towards the end of its working day, so I give her a call on her mobile phone. She is in a meeting but steps out to brief me on an employmentrelated issue. We are in agreement on the next steps, and I ask her to keep me posted. 3:45 pm My plan is to spend the next 2 hours focused on completing a list of ‘do today’ items that I have written on a yellow post-it note, which I have stuck next to my PC. In particular, I have a presentation to complete and an agreement with a company in Korea to draft, and I want to get this done today. I spend the next 2 hours focused on these tasks, with my office door closed. 4:40 pm A friend of mine who works for a fintech / cryptocurrency start-up calls and invites me to a craft beer tasting after work, a meetup for people with a mutual interest in this field. Tempting as it sounds, I decline. 6:00 pm I’m on the bus heading home. I call our Japan counsel, knowing that it’s 7 pm in Tokyo. (I know that if she is already on the train she will not answer my call. Fortunately, she is still in the office). I provide a few quick thoughts on the resumes I reviewed for a new role we have for the legal team in our Japan office, including identifying 2 candidates that I suggest we interview.

6.30 pm I arrive home, and am greeted at the door by both my daughters, my wife and my dog, all wanting my immediate attention. My eldest daughter tells me that my younger daughter had a fight with her best friend at school during the lunchtime break. I ask my younger daughter what happened, but she doesn’t want to talk about it. Dinner is on the table, and my wife has thoughtfully poured me a glass of my favourite wine. I deliberately put my phone away and spend the next hour or so with my family. After dinner I help my eldest daughter with some of her homework, and then read both girls a goodnight story. They are sound asleep by 8 pm. 8.00 pm I have a global sales legal team call starting at 9:30 pm. It’s very early for my US-based colleagues, but I know I will start to feel tired by the time the call starts. To ensure I make a productive contribution, I make a few notes in preparation for that call, and thereafter work through to around 9:15 pm responding to emails. 9.15 pm Time for a quick break before the 9:30 pm call. I bought the novel Crazy Rich Asians at the airport last week to read on a flight to San Francisco, and am halfway through. I spend the next 15 minutes on the sofa reading another chapter. (Having lived in both Singapore and Hong Kong, I can relate to many characters in the book). My dog rests his head on my lap. 9.30 pm My team call starts. My US colleagues are all starting their day and noticeably awake and energetic. My European colleagues, who have dialled in, are part way though their day, and I am getting towards the end of mine. 10.30 pm Calls are done. My wife is still awake, and we spend the next 15 minutes speaking about her day and planning for tomorrow. Then it’s off to bed, after which I will emerge refreshed and ready for the challenges of the next day. a

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THE OPPORTUNITY FOR LEGAL INNOVATION: WHY THE GENERAL COUNSEL IS FIRST AMONG EQUALS When ‘innovation’ only carried connotations of imaginative, creative and unique thinking, General Counsel (GCs) often found the pressure to deliver overwhelming. But its redefinition to include change that simply adds value, has not only made it easier for GCs to commit, it has made it easier for GCs to enlist others to help.

nnovation is a word that people have begun to roll their eyes at. Even in the legal profession, the innovation challenge has become akin to the ‘plain English’ fad of the late 20th century—slavishly adopted by some, largely ignored by others—that no longer generates strong engagement from those looking for the next seismic shift in legal service delivery. It was not always thus. In its earliest incarnation, innovation in the law was regarded as rare, mysterious, even a little frightening to those who believed that it could only be achieved in the form of the wild and crazy idea, the proverbial light bulb or Eureka moment. Many legal professionals could not recall ever having such an idea or moment in their working lives. But the early innovation experts changed this perception with their neuroscience and innovation toolkits, reassuring lawyers that innovation was not an inherent trait unique only to creative geniuses. Rather, they proved innovation is a competency capable of being developed with the right approach to learning. Lawyers became comfortable with this new truth because their experience had taught them that with intellectual discipline and dogged application, they could learn anything. Fast forward a decade or so since those expert pioneers, and innovation has become business as usual. It is less frequently included in organisational visions and values, less frequently incorporated in newlycreated job titles, and less frequently used as justification for purposebuilt innovation ‘hubs’, ‘hives’ and ‘garages’ in commercial office spaces. There are still numerous award programs and media publications that celebrate ‘innovation’ in the legal profession, and a healthy sense of competitiveness is likely to guarantee their survival for some time yet. But even if the celebrated achievements are relatively modest compared to industries like manufacturing, where inventiveness can be more dramatically demonstrated, those achievements reflect the prevailing reality in the profession—legal innovation has largely settled into the more comfortable, realistic, sustainable definition of simply being ‘change that adds value’. This is not to suggest that the innovation experts have left the scene, they have not. But even they are less likely, in 2018, to offer innovation per se as their core offering. Newer, more whole-of-enterprise oriented language has redefined the landscape: business process improvement, design thinking, customer experience. The GC’s ongoing challenge in this changed environment is how best to meet an organisation’s appetite for innovation, by leveraging the contributions on offer from various participants in the legal innovation ecosystem. The GC’s advantage however, lies in occupying the box seat, being the first among equals.

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The legal innovation ecosystem Sharing the current legal innovation ecosystem with progressive GCs are a multitude of players: traditional law firms, ‘new law’ law firms with alternative service offerings like flexible resource pools, suppliers of legal technology, providers of innovation expertise and training, industry licensing bodies, statutory regulators and industry member associations. The composition of the ecosystem, and the relative influence of these participants, will evolve. It does not follow that the ecosystem will be in a constant state of expansion, because actively pursuing innovation will not always be a key organisational priority. The benefit of maintaining an ecosystem, however, is that even during periods of low activity, it remains capable of being reactivated extremely quickly. The GC will be the stakeholder to whom the other participants in the legal innovation ecosystem look to, for clarity of direction. The fundamental questions in their minds will centre around the level of innovation that the GC has an appetite for, and the level of commitment from the GC, because innovation can burn resources very quickly.

The pre-eminence of the GC Many of the earliest forays by GCs into the world of innovation occurred on the back of broader organisational engagements with management consultants, whose focus was the revenue-generating part of the business. Over time, the legal function has come to justify its own innovation focus, but with the dual endgame of improving delivery of support to the organisation, while simultaneously enhancing value proposition for the organisation’s customer. To do this, the GC needs to align the legal team’s approach with the strategic priority afforded to innovation by the organisation. That could fall at many points along a spectrum, from being at the leading (or even bleeding) edge, to being an ‘early adopter’ or a ‘fast follower’. Then, the GC needs to be an open book when it comes to the problem requiring solution. In the majority of cases, the GC will not have solid data to clearly demonstrate a case for change. Rather, strong reliance will be placed on anecdotal evidence and the precedent established by like teams whose innovation experience and/or achievements have become more widely known. Many problems will be the manifestation of frustrations that the GC experiences via the legal team—the inefficiencies they encounter in creating or handling work because of the limitations of organisational systems, the unnecessary processes that need to be followed because of organisational structures or protocols/policies, and the responsibilities that they assume on behalf of other parts of the business that have proven unwilling or incapable of performing.

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And there is generally an important risk overlaying problem analysis. The GC must make a considered assessment of the inherent risk that the problem statement implies, then estimate the consequences for the organisation’s risk profile if an innovative solution is pursued and applied. To assist the GC, a deeper innovation capability is the logical starting point, and that means winning the ‘hearts and minds’ of the legal team so they are in the habit of thinking critically about the way that they perform their roles. It is counterintuitive for lawyers to fail fast while producing a minimum viable product, for example. Their tendency is towards perfectionism and a general unwillingness to release material that they are not completely satisfied with. But lawyers can be enthusiastic adopters of a more innovation-based approach when the permission to do so is clear, and that has been made easier by the dilution of any residual innovation ‘cringe’ factor by focusing on continuous improvement. Whether this involves the application of formal theory like lean six sigma or not, it is acknowledged that continuous improvement allows a focus on change that is incremental rather than sweeping, and mundane rather than revolutionary. The language that defines the landscape is different and more relatable: process mapping, design thinking, user experience. At the same time, GCs are monitoring the burgeoning field of legal operations, and experimenting with the creation of multidisciplinary teams that include professionals with qualifications in finance, business, marketing, HR, to bring to bear a wide range of skills and mindsets. Ultimately, it will be the GC’s need (or otherwise) to augment internal capability that dictates the extent to which external insights are sought. When they do, GCs are the first among equals here. They are the ones with the buying power, operating within organisations that are ripe with innovation opportunities. In progressive organisations, divisional financial plans cater for a degree of discretionary innovation spending—on pilots, for example— provided the business case stacks up. This represents a significant advantage for the GC over other participants in the innovation ecosystem, whose ROI is expected to be more robust.

Law firms (old and new): not just waiting around A significant place in the legal innovation ecosystem has been carved out by the private practice segment of the profession, in particular the more adaptable law firms that, like many of their clients, are keen to display their innovation credentials. In most cases, the early innovation focus was inward-looking, searching for new ways of operating the business to lift efficiency, profitability and competitiveness in a very mature and crowded market. Then the word, and expectations, spread to the client side of the equation; GCs began to put the question to their relationship partners, ‘If you are innovating to improve your processes, and we tend to replicate many of those processes within our own organisation for at least some of our work, how can we leverage the improvements that you have achieved, to make our lives easier?’ This question reflects a difficult tension for law firms to manage. To the extent that innovation has produced a beneficial outcome, there is an understandable desire to be proprietary, to reserve the benefits for the firm’s sole use. After all, that’s what IP law is founded upon—the exclusive enjoyment of the product of creative endeavour. Indeed, some

firms may want to look to commercialisation to supplement their core advisory services. But clients can be demanding and have begun to demonstrate a greater preparedness to ‘forum shop’, if not in respect of the legal advice traditionally provided, then certainly in respect of non-legal, valueadded services—like process innovation—that have become such an integral part of the relationship.

Suppliers of legal technology and innovation services: from concept to reality The undeniable strength that providers of legal technology and other innovation consultants bring to the innovation ecosystem is that of being able to identify a market need and to devise a solution for meeting it. For the most successful, this strength is built upon deep insight into the market’s operation, its inefficiencies, its pinpoints for participants and its sources of waste. To a degree, that insight can be drawn from analysis of statistical data and other forms of market analysis conducted by academia or the media. At some point however, these suppliers need to immerse themselves in conversations and in the physical observation of the market’s operation, so that they can tap into the true wants and needs of their prospective clients. The GC has a role to play in these interactions, engaging in conversations to get a sense of where the thinking is heading and a sense of which solution, among myriad options, is aligned with both the legal and organisational strategy. And for the right prize, the GC can drive suppliers to develop on the run, to modify their offering to fit organisational need. There is benefit for the supplier in doing this: exposure in real time to market forces that shape the functionality and relevance of their solution. But there is also a cost in terms of resource allocation, and for businesses that typically run on a lean budget, there is further burden from having to put other business development opportunities aside while attention is given to a demanding GC. These participants in the legal innovation ecosystem have identified that more than anything else, they need to be visible, sponsor industry events, host stakeholder roundtables, publish opinion pieces—generally build a profile and reputation as an active player in shaping the innovation conversation.

Regulators and licensing bodies: it’s never too late Regulators have been relative latecomers to the innovation movement, but have responded rapidly to the dual imperatives of needing to be aware of the ways regulated entities are developing their businesses in new directions, as well improving their own approach to operating. In doing so, they have become vital participants in the legal innovation ecosystem. These dual imperatives are challenging because innovation is a field in which the law and regulation inevitably lag behind the development and release of technology solutions for enhancing business operations. Regulators have identified the need to try to bridge this gap. But despite their regulatory mandate and authority, it does not necessarily follow that regulators are able to gain unfettered access to information about how technical solutions actually work.

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Even for regulators whose role is more limited—like the licensing bodies for the legal profession—the challenges are the same. Indeed, their focus on the observance of professional standards subjects them to the same imperative as that of the market regulator, to ensure that innovation does no harm to the standing of the profession or to the communities whom it serves.

Industry associations: the role of the honest broker Industry bodies have come to play a critically important clearing-house role in bringing together not only member organisations, but other ecosystem participants dealt with by members, to share perspectives and insights on past experiences and future directions. When engaged with openness, these forums provide opportunities for rapid exchange of information that drive advancement and innovation opportunities, and can quickly ensure that unprofitable or misconceived opportunities are not pursued. A large part of the reason for this is that industry bodies remove competitive tension; among organisations with parallel commercial objectives, what has been demonstrated as not adding value to one, will often be regarded as unlikely to add value to any. Of course, if this assumption simply results in a herd mentality, it is suboptimal for suppliers and regulators, dulls appetite for innovation and risks standards of the lowest common denominator.

Collaboration (not innovation) is the new black If there is a new buzzword that has taken over the mantle of ‘innovation’, it is ‘collaboration’. Much is asked of those who must find ways to work cooperatively, because the reality is that collaboration does not guarantee equal benefit for all collaborators. Indeed, many might collaborate for the benefit of one or indeed, of an entity that is entirely outside of the collaboration. Recognising this, GCs have approached the issue of collaboration by adopting both a push and pull approach. With respect to the former approach, GCs have become vocal in their demands that collaboration take place not only between their legal team and a selected law firm, but also among combinations of law firms for the benefit of the legal team, to assist with the pursuit of wider organisational objectives (like sustainable supply chain management). As regards the latter approach, GCs are demonstrating a stronger preparedness to volunteer their teams to participate in collaboration initiatives that will broaden the team’s skills base, expose them to new networks and create benefits for the organisation or the wider community. A clear benefit of collaboration is the inherent diversity of thinking that it brings, introducing diversity that spans across not only gender, age and education, but also cultural background and professional experience. A strong example of leveraging that diversity is the legal hackathon, a construct under which teams, generally comprising lawyers, technology experts and innovation thinkers, spend an intensive period of time developing or ‘hacking’ a solution for a predetermined common problem, before pitching a demonstration prototype to a judging panel for evaluation. Many hackathons have concentrated on issues like access to justice, and law firms and technology suppliers are beginning to get more comfortable with letting their guard down in collaboration opportunities designed to formulate new approaches to achieving a wider societal benefit. Similarly, regulators and industry associations have recognised structured collaboration initiatives as important opportunities for themselves and for academic staff and students, to build profile, forge relationships and add to their innovation credentials.

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A glimpse into the future When it comes to the various stakeholders in the evolution of legal innovation, the GC is the first among equals in being best placed to shape the direction and focus of innovation. It is the GC who has a commercial problem to solve or the commercial opportunity to exploit, and the mandate to do so. The GC has at their disposal several fundamental ingredients necessary to shape the analysis—the data, the subject matter expertise and the ‘rules’ (both organisational and regulatory) that set the parameters for what is possible. In exchange for these fundamental inputs, the GC has majority say in the ultimate outcome. The GC can influence the pace of innovation activity and its scope. The GC can dictate the degree of involvement that participants in the ecosystem will have, and the timing of that involvement. And ultimately, the GC will be the decision-maker on the question of whether a solution is to be adopted. Visionary GCs will continue to draw inspiration from new thinking about doing things differently, wherever the source of that thinking. Some of it will be organic, coming from the in-house team as diversity continues to increase and capability continues to build. Some of it will come from law firms, as a result of their leveraging insights gained across their practice areas and industry segments. Yet more will come from suppliers and the science- and academic-based advances that recognise innovation cause and effect and the technology-based advances that come from increased computing power and machine learning. Some will come from the broadly-based, stakeholder-directed thinking of regulators and industry associations. Increasing collaboration among participants in the legal innovation ecosystem will have a multiplier effect on more traditional bilateral engagements, for the benefit of the legal profession overall as well as for the wider community. There will be more new thinking available than can possibly be assimilated, so GCs will need to make ‘no regrets’ decisions about the sources they are going to rely on. The balance of such information mix will change over time, but the astute GC will be constantly monitoring for points of inflection, and will remain agile, ready to pivot, tilt and respond with the appropriate legal innovation investment. a

Justin Moses As a member of the Compliance, Legal & Secretariat division at the Westpac Banking Corporation, Justin accumulated more than thirty years of experience acting in advisory, leadership and practice management roles that at various times supported each of the Westpac Group’s retail, institutional and wealth management businesses. Earlier this year Justin joined lexvoco, seeking an opportunity to draw on and apply this experience and further lexvoco's aim of helping in-house lawyers succeed.

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STATE OF THE AUSTRALIAN LEGALTECH MARKET FOR GENERAL COUNSELS Legal technology (LegalTech) in the $23 billion Australian legal industry has shifted from the periphery into mainstream consciousness of the legal market.

he LegalTech ecosystem in Australia is leading the way in the Asia-Pacific region, driven largely by a healthy LegalTech start-up community and increasing adoption of LegalTech solutions by law firms and corporate legal departments. A strong grassroots movement led to the launch of Legal Hackers chapters in Brisbane, Perth and Sydney in 2017, and Melbourne in 2018. The LegalTech ecosystem is driven by eight major categories of stakeholders, with each playing an important role in developing the market. This paper will explore key developments driven by three of the eight major stakeholders, namely corporate legal departments (buyers of legal services), law firms and LegalTech firms in Australia.

seen internal legal budgets growing marginally from an average A$1.5m in 2008 to an average A$1.7m in 2017 for corporate legal departments in ANZ. A further breakdown of internal legal budgets reveal corporate legal departments are underinvesting in technology (4% of total budget) and workflow (2% of total budget). Breakdown of ANZ's corporate legal departments' internal legal expenditure in 2017

Technology

Workflow

Staff training Regulators

Law firms Other staff salaries and related costs

Investors

MAJOR STAKEHOLDERS OF THE LEGALTECH ECOSYSTEM

LegalTech firms

Technologists

Buyers of legal services

Law students and schools

Law associations

The case for LegalTech in corporate legal departments In an ever increasingly complex business and regulatory environment, corporate legal departments are under pressure to deliver legal services to their organisations efficiently and effectively. The Association of Corporate Counsel Australia’s 2017 Benchmarking and Leading Practices Report reflects this reality, reporting that ‘workload / time pressure’ has been the most pressing issue for in-house lawyers in Australia since 2008. The study also reveals two-thirds (60%) of in-house lawyers in Australia and New Zealand (ANZ) were under pressure to reduce legal costs. This has

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In-house lawyer salaries and related costs

*Source: ACC Australia Benchmarks and Leading Practices Report 2017

Under-resourced and under pressure to be more efficient and effective, corporate legal departments are truly living the Susskindian ‘more for less’ world. This pain point has created a thriving and growing LegalTech segment of legal operations (LegalOps) that are geared towards improving legal departments’ efficiency and effectiveness. Solutions for LegalOps include matter management, spend management and workflow management. They assist with triaging matters to help in-house lawyers focus on the strategically important and most pressing matters, implementing project management principles on matters and tracking external legal service providers on outcome, time and budget. While the business case for corporate legal departments to adopt LegalTech solutions is strong, corporate legal departments are under-resourced for gauging the different LegalTech solutions in the market, and need help

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to build an internal business case to access IT budget from the wider business to implement such solutions. Consequently, adoption of LegalTech solutions in the market is relatively low.

Australian law firms proactively engaging with LegalTech Some Australian law firms have already started to roll out their LegalTech strategies. These firms are leading the way in LegalTech adoption, either through development of their own LegalTech solutions, consumption of LegalTech solutions or partnership arrangements with LegalTech firms to develop a new tech-enabled legal service. For some law firms, it is possible to build internal LegalTech capabilities. Firms that have chosen this path are either consuming the LegalTech solutions they have built or are commercialising those LegalTech solutions. Examples of firms that are commercialising their LegalTech solutions include Allens Linklaters’ e-discovery service and Corrs Chambers Westgarth’s e-discovery business, Telesto. For the majority of law firms, licensing LegalTech solutions is the easiest route, as the onus is on the LegalTech provider to be accountable for software performance, security and integrity. Firms can leverage multiple LegalTech solutions to better manage their practice and better serve their clients. In this case, firms become the consumer of LegalTech solutions. For some firms, opportunities exist to engage in a strategic alliance through an equity alliance or joint venture, to leverage LegalTech capabilities in the market. An example of this is the 50:50 joint venture between Corrs Chambers Westgarth and the Canadian LegalTech firm, Beagle Asia Pacific, to provide artificial intelligence technology for contract review and analysis in the region. Another example is Allens’ collaboration with Kira Systems and Neota Logic to combine legal expertise, machine learning review capability and expert systems software to automate lease reviews. Others include

Norton Rose Fulbright’s alliance with LawPath, and Gilbert + Tobin’s equity investment in LegalVision to target the start-up market. Driven by intensifying competition, these firms are proactively engaging with LegalTech solutions, innovation consultants and technology consultants to help in-house lawyers navigate the ‘more for less’ world. Hall & Wilcox’s Smarter Law initiative is an example of proactive engagement with corporate legal departments to help in-house lawyers get better at doing their work. Of course, most of this development is driven by firms with deep pockets and management commitment to differentiate in a hypercompetitive market where upstarts from NewLaw, LegalTech and Big Four segments are converging.

The rise of LegalTech firms in Australia Technology first touched the practice of law in 1970 when Lexis (the predecessor to LexisNexis) was founded to convert codified legal knowledge into electronic form the statutes, regulations and precedents that were locked away in leather-bound books. The technology market has since changed, of course, from mainframe applications, client-server applications to internet applications and now, cloud-enabled applications. Cloud computing has produced cloud-enabled LegalTech solutions, triggering an explosion of LegalTech start-ups and also shifting solutions by incumbents to the cloud. In my research of the Australian LegalTech market, the history of LegalTech in Australia can be traced back to 1988 when LawMaster, a legal practice management solution provider, was established. The following chart reveals that today, the LegalTech market is on an upward trajectory as more LegalTech companies are conceived. The market expanded rapidly between 2015 and 2017, as 38 new LegalTech firms were established in that period.

Number of LegalTech firms founded (or entered the Australian market) by year in Australia

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The research also identified 92 LegalTech firms in Australia. Our burgeoning LegalTech scene has generated a lot of interest, and also confusion, in the difference between solutions and how they integrate and interface with current infrastructure and internal processes. An analysis of LegalTech solutions in the market reveals legal document automation is the largest

segment in the market, followed by LegalOps and legal marketplaces (see chart below). Of course, the analysis captures only the primary solution of LegalTech firms, noting that some, like Thomson Reuters and LexisNexis, are diversifying outside their original niches and increasingly operating in multiple segments of the LegalTech market.

Australia's LegalTech market map

For in-house lawyers, one of the segments to look out for is LegalOps. LegalOps solutions are geared towards helping corporate legal departments with matter management, spend management and workflow management. The document automation segment is another segment that can assist in-house lawyers with efficiency, by automating high volume contracts and taking into consideration the organisation’s risk profile. While the LegalTech start-ups’ market is thriving, like most start-up businesses they are faced with the same challenges of growth (market penetration and adoption), resources (access to sales and product development skills) and capital (to fund growth). In a market characterised by high-risk aversion and tight budgetary controls, LegalTech firms face an uphill battle in selling solutions. Successful LegalTech firms are focused on fine-tuning their solutions to better solve pain points and on adjusting their business model for commercial viability.

The Australian LegalTech market: a buyer’s market LegalTech firms serve three primary market segments, namely consumers, corporate legal departments and law firms; note also that 14

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some LegalTech firms serve multiple segments of the market, as their solutions are transferrable across segments. My research on the primary segments served by LegalTech firms in Australia reveals that the law firm segment is the largest, with 52 law firms, and the corporate legal department segment is half that, with 26 firms. Unsurprisingly, the biggest LegalTech segment in the corporate legal department market is LegalOps, with 10 firms.

As highlighted in this article, ACC Australia recently launched the Legal Tech Corner website. This initiative is designed to offer our members a range of content to help support their LegalTech journey and enhance their understanding of LegalTech solutions. The website features blog posts, LegalTech Q & A and a directory of LegalTech providers here in Australia. Check it out at legaltechcorner.com

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Number of LegalTech firms in Australia by primary segment1 served

Years in operation in Australia2 1. 2.

This research looks at the primary market segment that the LegalTech firms sells to Years in operation tracks the year founded of the first LegalTech firm in that segment (i.e. LawMaster was founded in 1988 therefore the law firm LegalTech segment is 30 years old)

Australian LegalTech market map of solutions geared towards corporate legal departments

To assist corporate legal departments navigate this dynamic and fluid market, the Association of Corporate Counsel Australia has launched LegalTechCorner, a directory of all LegalTech solutions in the Australian market geared towards corporate legal departments. It is a great resource for in-house lawyers who are embarking on their LegalTech journey. In many ways, the first step is to understand the solution landscape to identify the one that best fits the challenge of in-house legal efficiency or effectiveness.

Eric Chin A co-author of the ACC Australia 2017 Benchmarks and Leading Practices Report, Eric works with law firms, NewLaw firms, LegalTech firms, Big Four accounting firms and corporate legal departments on strategy, mergers and acquisition, market analysis and competitive analysis. His work spans across the Asia-Pacific region, the US and Europe. Eric is also a co-founder and co-organiser of the Legal Hackers chapter in Melbourne.

It is also important for in-house lawyers to take note and focus first on the problem that is being addressed in your LegalTech journey, before focusing on the technology itself. The best practice in adopting LegalTech is to start with the problem, then the people (how you currently work around that problem), the process (how this can be improved or changed to solve the problem) and finally, the technology (as an enabler of the people and process to solve the identified problem). a VOLUME 28, ISSUE 4 â&#x20AC;&#x201C; SUMMER 2018 |

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CHANGES IN THE LEGAL MARKET VIA DISRUPTIVE TECHNOLOGIES The contribution of digital technologies to the Australian economy is forecast to be $139 billion by 2020, when it will equate to 7% of Australia’s GDP (DAE 2015a). This represents the size of Australia’s digital economy and illustrates the significant role technologies such as cloud platforms, data analytics, artificial intelligence (AI) and the Internet of Things (IoT ) will play in driving economic growth in Australia.1

isruption is the result of the rapid evolution of a business that fundamentally changes the market it operates in. The terms ‘disruption’ and ‘innovation’ have almost become interchangeable since the Harvard Business School Professor, Clayton Christensen, coined the term ‘disruptive innovation’ in the 1990s. Today, the fear of not innovating is driving businesses to look for opportunities to transform or innovate to stay relevant to their market or compete against start-ups who are not held back by legacy constraints. When looking at successful disruptors in different markets, one thing becomes apparent: you shouldn’t try to be faster than your competitors; instead, you should aim to be better than them. When considering the impact of disruption on a market, you need to examine how long you can maintain the advantage you have gained compared to others. Often, the ability to maintain the advantage gained will require a business to continually innovate and consider client needs. What is assured is that once a market is disrupted, competitors will follow and copy the success (often without the investment) of the disrupter. Examples of this behaviour are common in businesses such as AirBnB and Uber. However, in all cases of disrupted markets and gaining rapid market share in a short amount of time, the competition ‘copied’ many of the innovations that were developed to compete and survive. In both cases of disruption and rapid innovation, the process often occurs quickly. The speed of change often means businesses are using agile change management processes, and risk management is critical to the success of such change.

Netflix's distinctive strength is its the ability to understand its customers using analytics and behavioural data. Uber Ride-share companies such as Uber demonstrate how a disruption is often caused by a general lack of innovation in a market. Before ride-sharing services, taxi companies had three advantages over other competitors: drivers who knew how to navigate, a dispatching system to manage a fleet of drivers, and a high level of government protection for their services. With growth in technologies, such as GPS and smartphones, any competitive advantage from the first two factors were negated; the third advantage is constantly being eroded. When you consider the industry in general and whether it was ripe for disruption, you only need to look at the issues often highlighted by customer feedback. Were drivers and phone dispatchers universally courteous? Were the vehicles always clean and safe? It is this lack of any real advantage that made the industry vulnerable to disruption. What is apparent in this industry is that once you disrupt its market, your competitors will follow. Most taxi companies are looking to implement updated apps, better tracking systems and improve customer experience on the back of Uber's innovation.

Ride-sharing companies have disrupted the taxi industry by using GPS systems and smartphone technologies effectively, eroding any competitive edge held by taxis in the market.

What does a disruptor look like? There are many recent disruptions in markets we are all familiar with. In each case, the common theme that enabled success was that the business predicted what its customers wanted. Also, all disruptors used technology as the fundamental change facilitator.

Netflix Netflix is not a new company; it has disrupted its market more than once. This market also demonstrates what can happen if a business does not respond to change sufficiently quickly: the collapse of Blockbuster is one of the larger fatalities recorded. In the late 1990s, when Netflix was directly competing with Blockbuster, it focused on convenience and developed a mail-order distribution service. They used customer desire for convenience and irritation with late fees to rapidly gain market position. In 2007, when streaming technology started to become viable, Netflix completely changed its business model to offer services via that medium. In 2013, the business started to create content, using artificial intelligence and machine learning to identify the types of content their customers were interested in. It was the use of both the data collected and these technologies that enabled Netflix to be at the forefront of innovation, disrupting their market a number of times. 16

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Airbnb While companies offering services similar to Airbnb have not dramatically affected major hospitality companies, they have certainly disrupted the market. In many ways Airbnb has actually helped the hospitality sector by increasing travel among all demographic groups and enabling low cost accommodation options for many travellers who simply cannot afford hotels. The rise of Airbnb has forced many larger players in this sector to look closely at their businesses to improve their services. In 2016, the Marriott and Starwood chains merged to become the world’s largest hotel chain, bringing together features and reward programs from both sides to attract and retain customers.

The rise of Airbnb has increased travel among all demographic groups, which has created a new market rather than completely disrupting the existing model.

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Technology, the enabler

Adequate project management processes

When considering examples of real disruption and those companies that are responsible, it becomes apparent that technology is a key factor in their success. The use of technology will often be the innovation, enabling the business to identify and execute fundamental change. Many new and emerging technologies are now enabling and causing disruption, including: •• Internet of Things (IoT) •• advancements in analytics, and artificial intelligence and machine learning (AI) •• robotics (automation) •• blockchain technologies.

Big change in an organisation is often managed through using projects, with steering committees, responsible stakeholders and key delivery streams. Two important questions to consider are: has an organisation’s project management process kept pace with the digital age, and are key risk management gates built into the process to deal with modern technology risks? If not, then they should be.

Many of these technologies will coexist and be used in combination to identify opportunities to disrupt markets. AI is often paired with robotics to enable the automation of tasks traditionally performed by humans. Many businesses are looking to adopt these technologies to build efficiencies, reduce labour costs and increase quality and accuracy. The disruptors have built platforms that enable businesses to adopt these technologies without large-scale investment. IoT and blockchain technologies are often paired when building new supply chain technologies. Iot devices exist on packages, containers, vehicles and ships, to track various conditions such as movement, environmental conditions and location. This information is written into a blockchain and becomes part of a digital contract.

The great risk divide An organisation’s ability to keep pace with the market, their competitors and the demands of their customers, is critical. A modern day imperative is that it also keeps pace with advancements in technology. As discussed at the beginning of this article, this landscape is changing rapidly and requires a team of people for structured, balanced and strategic thinking, with clear direction about which technologies to invest in, and how to integrate them into ‘business as usual’. There is plenty to choose from! But what of risk? In the digital age, it is fair to say there is the potential for a ‘risk divide’. In mature organisations, this divide will be small, if not already bridged; in less mature organisations, the gap may be quite pronounced. In a start-up, there is often no risk-aware culture at all except possibly from savvy investors who are asking the right questions. The divide we are talking about is the perceived (or real) difference in objectives between the risk-takers or ‘innovators’, and the risk managers or ‘fun police’. This is an issue that resonates with many General Counsels (GCs), as often the role of the GC is to make sure that the key risks are adequately assessed and managed. This risk divide is not new to business, we have always had operational arms in a business and centralised risk and compliance managers. But the rapid growth of technology accentuates the potential technology risk divide, and makes it a real issue that needs to be tabled and addressed. Some of these risks can end businesses, like those associated with cybersecurity and data privacy, or at least have a significant impact on an organisation. So, what are some of the strategies for bridging the divide? The technological advancement of any organisation does not necessarily signal the introduction of heightened risk, and the ‘fun police’ are often more capable of participation than people think. So why is it that, in many organisations, the people charged with identifying and managing strategic risks to the business, are often consulted last or late in the innovation or disruption journey? Generally, there are two main factors underlying this: a lack of familiarisation with the process (or a lack of process), and a fear of the answers.

Early consultation on risk avoids the ‘traffic cop’ scenario that most project teams complain about. Security-in-design, privacy-in-design or just plain risk-in-design are not just buzzwords, they are an important aspect of modern projects and change management. If a business engages early with appropriately qualified and proactive risk managers, takes the time to identify key risks, and builds in strategies during the design, build, testing and acceptance phases, then there will be far fewer surprises at the end. Factoring it in upfront also means factoring in the costs and timeline.

Avoiding the inevitable Another factor that can enhance the risk divide is avoidance. Often, people who are taking risks know they are taking those risks, and if allowed, they will delay the inevitable risk management and acceptance conversation until the last minute. This can result in delays, overruns (budget and time) and the acceptance of heightened risk into the business when it may have been avoided. This goes beyond process; it is cultural. It is important (and the GC plays a key role here) to create a culture that is mature about accepting risks, and mature about the proper and timely mitigation of risks that are foreseeable. This is easier said than done. It needs to be driven from the top down, across an entire business. Reinforcing or justifying risky practices to meet a product launch deadline sets a cultural tone that can be hard to undo. a Footnotes 1. Deloitte Access Economics, 2017, p. 1, in Australia’s Digital Pulse: Policy Priorities to Fuel Australia’s Digital Workforce Boom, a report prepared for Australian Computer Society)

Darren Hopkins A highly respected, qualified investigator and forensic technology expert with more than 20 years of specialist forensic experience, as a Senior Partner at McGrathNicol Advisory, Darren specialises in advising businesses on both proactive and reactive uses of technology in the areas of cybersecurity, privacy, digital forensics and technology-led investigations.

Brendan Payne As a Senior Manager of McGrathNicol Advisory, Brendan specialises in the capture and analysis of digital evidence, data recovery, cyber resilience and conducting technology related investigations. Brendan has over 11 years specialist experience and has undertaken a number of complex forensic technology examinations both in Australia and overseas. VOLUME 28, ISSUE 4 – SUMMER 2018 |

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DIGITALISATION, TECHNOLOGY AND INNOVATION ARE CHANGING IN-HOUSE LEGAL TEAMS Markets around the world are in the midst of a technological transformation. Disruptive technology and new opportunities are changing the way businesses think, and IT and digital issues remain a top priority for CEOs. How does this impact in-house legal teams?

here is no doubt that the role of the in-house counsel is changing. We are seeing this first-hand at QBE, and the demands of our business from a technology and digitalisation perspective have resulted in the establishment of a team of technology transactions specialists.

Trends and key recent technological changes As the ‘fourth industrial revolution’ gets underway (as it has been coined), technological transformation and digitalisation are high priorities for almost every organisation. The potential for technology innovations to transform the way we operate and do business is vast, and in-house counsel will no doubt be experiencing high demand to take up these opportunities from their internal clients. Many organisations have long been heavy users of cloud-hosted solutions, but they are now moving beyond the earliest phases of software-as-aservice deployment to complex and large-scale platform-as-a-service and infrastructure-as-a-service arrangements. There is wide-scale investment in artificial intelligence technology, and this is transforming customer experience and interaction, not to mention other areas of operation. Distributed ledger and blockchain technologies are providing technological means to achieve smart, transparent supply chains. As these technologies become increasingly available in the market, the scale and frequency of strategic technology transactions are exploding and in-house legal teams undoubtedly have a key part to play in ensuring the success of these arrangements. This article considers how changes in the technology landscape are changing the demands on, and skills required of, in-house lawyers.

Transformation of the deal pipeline

At QBE Ventures, we especially appreciate how open-minded and curious our in-house counsel are. There’s a lot for everyone to learn when working with early-stage start-ups or emerging technologies, and what we’ve found is that it makes a difference that our counsel really embrace these opportunities to learn with the business. Ted Stuckey, Managing Director, QBE Ventures

New deals Many organisations are developing their own venture capital businesses. For QBE, this takes the form of QBE Ventures. We have already invested in a number of emerging companies, including Jupiter Intelligence (a cloud 18

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platform provider of climate risk predictions), HyperScience (an artificial intelligence technology company) and most recently, Zeguro (a cyber risk management platform). One of the most interesting aspects of these ventures or divisions is that they often involve a commercialisation aspect. From an in-house legal perspective, we must think about the risks of the transaction in a different way—as an investor or even as a supplier, rather than our usual role as customer. The other change that in-house counsel have observed in recent years is a vast increase in cloud-hosted transactions—software-as-a-service, infrastructure-as-a-service and platform-as-a-service arrangements. The result of these transactions is that an organisation’s data, including personal data and commercially-sensitive confidential information, will leave the direct control of the organisation and be hosted in the systems of a third party. The IT and cybersecurity controls within these agreements, together with practical mechanisms to monitor risk on an ongoing basis (such as security assessments, penetration testing and audits), become a critical part of the customer organisation’s risk management process.

New counterparties We are also seeing our business contracting with different counterparty profiles. Our deal flow increasingly involves newer providers, some start-ups and smaller organisations reselling technology provided by traditional tech giants. These counterparties are often more agile and willing to engage in negotiations in our technology transactions. However, they also often carry higher risk. The technology of such counterparties may be new to the market, which can mean there is a higher chance of an intellectual property infringement claim, particularly where we’re looking at pilot arrangements as a first mover. The financial standing of these more dynamic counterparties and their ability to pay damages may not be as strong as that of technology giants, so we have to manage the commercial structure of such deals in terms of payments and liability slightly differently.

Risk priorities for in-house lawyers Cybersecurity An acute focus on IT transformation and digitalisation among the C-suite naturally influences the priority risks for general counsel. Cybersecurity remains a key agenda item for executives. Recent privacy law reforms, including mandatory data breach notifications in Australia and of course, the General Data Protection Regulation that is becoming effective within the European Union, create an ever-changing and increasingly regulated landscape. Organisations like QBE, with a global footprint spanning jurisdictions with wide-ranging approaches to personal information and privacy regulation, need a strategy to ensure cross-border privacy compliance. This can be a challenge for negotiations with suppliers, and in-house lawyers need to be well versed in the risks and concerns across the organisation’s key markets to participate in these negotiations.

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The other priority for in-house lawyers in relation to data cybersecurity is access to our data. Decentralised cloud strategies may result in loss of direct control of our data (compare this to a traditional on-premise arrangement in which all data is hosted within the organisation’s own data centres). Aside from the cybersecurity side of things, a key concern for in-house lawyers is ensuring data access and availability. This is particularly important for an organisation that, like QBE, is highly regulated.

Intellectual property The technology transactions that innovating organisations are entering into often do not align with the simple intellectual property schematics often found in traditional software licensing agreements. Transactions may involve joint development, integration of different third-party technology and collaboration between different organisations. These arrangements pose a challenge for in-house legal teams. The intellectual property schematic within the organisation’s technology agreements is often bespoke. It also needs to align with other contracts that the organisation has entered into. There is an intellectual property management aspect to technology contracting, as technology transactions increasingly result in an organisation having proprietary rights that it can further exploit. Creative thinking is required to find outcomes that are mutually acceptable to providers (who often still want to own everything) and customers alike. In-house lawyers face another intellectual property risk, in terms of uncertainties around the application of the law to new technologies. There are questions as to whether copyright may subsist in the output of artificial intelligence technology, for example. This is further complicated because the approach taken across jurisdictions differs. As organisations invest more heavily in disruptive technologies, in-house lawyers need to be aware of some of these academic and policy debates to be able to manage their intellectual property risk.

When it comes to digitalisation and innovation, we want our in-house counsel to be across the key digital trends, and able to adapt and evolve our partnership legal constructs to meet changing delivery models. From distributed Agile teams to data protection with cloud-based software vendors, our legal team thinks differently and innovates with us. Marcus Marchant, Group Chief Digital and Innovation Officer, QBE Group

Changes to in-house legal teams The composition of in-house legal teams is changing. To meet the needs of an organisation with a global digital footprint and vast volumes of personal data, specialised and experienced technology lawyers are required. The flow of technology transaction work is often now so consistent that it demands a team of experts dedicated to this practice area. QBE group legal teams are no exception. The Global QBE Legal team now consists of a dedicated team of technology lawyers, something which did not exist four years ago.

The skills required of a technology lawyer in organisations today are increasingly different to those required from the more generalist commercial lawyer. Technology contracting arrangements are increasingly complex, and in-house teams need to be conversant in key technology structures and terminology to be able to quickly understand these transactions. To understand and identify key risks, and to be able to take a risk-based approach in negotiations (which internal clients expect), in-house counsel need to be prepared to partner with the business and have an innovating mindset. They need to be solution driven and able to think outside of standard contractual approaches. Digitalisation and technology agendas are also changing the relationship between legal teams and compliance groups. Many compliance groups now have dedicated privacy experts whose role naturally interplays closely with the role of legal counsel negotiating agreements that involve personal data. In an APRAregulated organisation, we also work closely with Compliance in relation to material outsourcing analysis—this interface does not necessarily change with current technology trends, but is certainly becoming more frequent. We find our legal counsel working increasingly closely with their compliance colleagues to ensure that risk-appropriate, proactive, consistent approaches are being taken with the business in our respective fields of expertise. a

Johanna O'Rourke As a member of QBE’s global legal, regulatory and compliance leadership team, Johanna leads QBE’s global operations, technology and commercial legal team. In that role she advises the QBE group on all technology and commercial legal aspects of ground-breaking digital transformation, AI, Insurtech, robotics, data and analytics, global transformation and global sourcing initiatives. and is a member of QBE’s global privacy working group.

Sophie Lees A senior associate of Norton Rose Fulbright, Sophie is an IP and technology lawyer specialising in complex and strategic cross-border technology contracts. She has practised in London, Munich and Sydney and is currently seconded to the QBE group legal team, where she is advising the business on digital transformation agreements and supporting commercialisation and Insurtech activities within QBE Ventures.

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THE 2018 ACC AUSTRALIA NAT I O N A L CONFERENCE The Australian in-house community gathered in Brisbane for the recent 2018 ACC Australia National Conference. Located in the heart of the spectacular Southbank precinct, the Brisbane Convention and Exhibition Centre played host to three days of keynote presentations, panel discussions and product demonstrations. Highlights of the three-day event included contrasting but equally thought-provoking presentations by Professor Richard Susskind who asked whatâ&#x20AC;&#x2122;s next for our profession? And Emeritus Professor Gillian Triggs who highlighted the issue of in-house counsel as the moral compass of the organisation. The event also coincided with the 2018 In-house Lawyer Awards, held at the redeveloped Howard Smith Wharves overlooking the Brisbane river. ACC Australia would like to acknowledge and thank all delegates, speakers and exhibitors for making the 2018 ACC Australia National Conference such a memorable event. We look forward to welcoming our members and sponsors to the 2019 National Conference, this time in Adelaide, November 13-15, 2019.

The ACC Australia in-house lawyer awards represent the most prestigious awards program for the in-house legal sector in Australia and are the only awards program judged exclusively by the in-house community. ACC Australia congratulates each of the 2018 finalists and applauds their contribution to and deserved recognition as leaders in the Australian in-house community. VOLUME 28, ISSUE 4 â&#x20AC;&#x201C; SUMMER 2018

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CORPORATE LAWYER OF THE YEAR Jenny Selby, General Counsel Pacific, AccorHotels Also recognised on the night were Corporate Lawyer of the Year finalists:

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aving spent twenty-four years in the AccorHotels legal team, Jenny Selby has played an integral role in the growth of the Asia Pacific business. In doing so, Jenny has built a reputation internally as someone that combines deep technical legal expertise, with a clear understanding of the company’s strategic goals. As a testament to her standing within AccorHotels, Jenny sits on a number of committees within the organisation, including the Strategic Steering Committee, the Executive Committee, the Australian Pacific Leadership Team and risk and crisis committees. Leading a team of eight lawyers and four paralegals, Jenny’s team provides legal advice on a range of areas for a business that encompasses individual hotels across Australia, New Zealand, Fiji and French Polynesia. Over the past twenty-four years, Jenny has been instrumental in achieving AccorHotels’ major ventures in Australia Pacific, which has seen the group grow to over 380 individual hotels. More recently, Jenny maintained sole responsibility for the legal aspects for the acquisition of the Mantra Group. This transaction was extremely significant for the Global AccorHotels Group and was described by the Chairman and Chief Executive of AccorHotels as ‘underpinning the long-term growth of AccorHotels in Asia Pacific’. The $1.3b transaction saw the acquisition of Australia’s

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I am very honoured to receive this award, which is also a credit to all my colleagues. Winning this award is indicative of our highly skilled legal team, and also the many experts in so many disciplines within AccorHotels who have all taught me so much and supported the work that I do.

second largest hotel and resorts operator with 138 properties and over 20,000 rooms. In addition to the recent Mantra acquisition, changes within the structure of AccorHotels saw the creation of AccorInvest and the divestment of twenty-four hotels within Australia. As a leader within the organisation, Jenny has been a tireless ambassador for the transfer of legal knowledge between AccorHotels operating regions globally and the driving force of the company's legal training program. Recently, Jenny rolled out AccorHotels’ revised compliance program across the Pacific. Her detailed operational understanding of the business and ability to work closely with the business helped ensure staff have the necessary skills to identify legal risks in their everyday roles. Jenny was recognised for her contribution to AccorHotels in 2015 when she was one of five people worldwide to be awarded AccorHotels’ highest honour, a ‘Gold Bernache’, for her contribution to AccorHotels. This prestigious award recognised Jenny’s key role in growing the number of hotels in the Asia Pacific region and for her significant role in supporting AccorHotels’ strategic direction. Beyond the law, Jenny holds a position on the board of the AccorHotels Community Fund Australia which supports a number of charities focused on building healthy families.

Katrina Johnson, Asia-Pacific General Counsel, Uber Katrina joined Uber in 2015 as the first lawyer for Australia and New Zealand and was directly responsible for securing positive regulatory reforms throughout the region. Katrina works across the Asia-Pacific region managing an effective legal team comprising of 24 full-time employees and ten contractors, located in eight countries. Uber is one of the fastest growing companies, and the profile, scale and pace of their legal and regulatory work is immense. Recognised as one of Uber’s thought leaders, Katrina has championed numerous operational excellence initiatives. She established the first legal clinic for Uber globally and spearheaded the internal development of various tools to optimise legal services delivery, including self-generating contracts, a legal training chatbot, a contracts portal for receiving, tracking and responding to contract requests, and an application that automatically flags problematic legal phrases in marketing materials.

Serryn O’Regan, General Counsel, Evoke College Serryn has been instrumental in establishing Evoke College as an industry leader with an impeccable regulatory record. She has set an unwavering high standard of operation, higher than required under legislation and regulations. Her unwavering commitment to quality and integrity has caused a shift in the culture of business operations to one that is an open, collaborative relationship, where legal matters are considered highly important, and treated as a means of gaining a leading edge in the market and not just a matter for ‘legal’ to ‘deal with’. Serryn has become known as an industry leader in terms of her legal and regulatory approach and has been asked to speak at national events on quality and the legal and regulatory regime of education and training. a

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GOVERNMENT LAWYER OF THE YEAR Alice Linacre, General Counsel at Australian Government Department of Agriculture and Water Resources

ollowing an extensive legal career across the public and private sector, Alice Linacre joined the Department of Agriculture and Water Resources as General Counsel in January 2017. In that role she holds responsibility for managing all legal matters affecting a department whose five thousand staff throughout the country are tasked with delivering a range of programmes across Australia.

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Under Alice’s leadership, the department’s in-house legal team has built a reputation as a trusted adviser. Though still relatively new, the in-house legal practice under Alice’s leadership has developed innovative ways to deliver legal services. This has included high-level “elevator briefings” to concisely explain legal issues to the Department’s executive and agile resourcing to respond to major issues. In leading the department’s Assurance and Legal Division, Alice maintains responsibility for all legal services required by the department. This encompasses contracts and grants management, statutory interpretation and regulatory advice, international trade law and agreements, development of legislation, privacy, debt recovery, investigations, enforcement, litigation and claims resolution. The Division also advises on matters relating to the Freedom of Information Act 1982 and legislative processes. Recognised as a leader within the department, Alice sits on the department’s Executive Management Committee, the department’s primary governance body. As General Counsel, Alice advises the Secretary, the Department’s Executive, the Minister and his office on complex legal issues. Her pragmatic approach to legal risk management has been credited with driving the success of the department by providing effective advice on how legal risk can be managed within the constraints of time, resources and political sensitivities. She has also worked to assist departmental clients to design and implement best practice procurement processes and contracting arrangements. Notably, Alice has developed and delivered whole of department legal training. Alice has been responsible for several significant legal projects, including as primary legal adviser on the establishment of and as a member of the Regional Investment Corporation board. This entity will be the national administrator for the Commonwealth's farm business concessional loans and the National Water Infrastructure Loan Facility. In broadening the legal capability within her department, Alice has developed an in-house Continuing Legal Education programme. Furthermore, she’s implemented secondment arrangements between the Department of Agriculture and Water Resources and other

>> Alice was unable to accept her award at the event as she is currently undergoing chemotherapy following a recent cancer diagnosis. Her colleagues Brittany Biron and Liana Grieve accepted the award on her behalf.

Receiving this award from ACC Australia was a huge surprise and unexpected honour. I am proud to work as an in-house lawyer with an amazing team in a great agency. I always say in-house practice is the hardest so why would you do anything else! Recognition from my peers is the cherry on the top.

government agencies to encourage mobility and provide development opportunities. As a leader Alice empowers her team to take responsibility for delivering excellent in-house legal services. She is a sought-after mentor outside the department and has participated in mentoring programs across the Commonwealth including the annual Australian Public Service Commission Graduate Mentor event, Country to Canberra and the Australian Government Legal Network Legal Circles Mentoring Program.

Also recognised on the night was the other Government Lawyer of the Year finalists: Ann Swain, General Counsel & Company Secretary, Tasracing Ann was the first in-house counsel to join Tasracing and she quickly, and successfully improved the reputation of Tasracing with industry stakeholders and the community. She is credited with effectively educating the business on how the General Counsel role benefits the organisation and spent time educating staff on the efficiency of centralised legal services to ensure an alignment between legal and business priorities. This centralisation saw a thirty-five per cent reduction in external legal spend. Ann’s role requires clear analytical thinking and a strong ability to work cross functionally with Finance, Racing, Assets and Facilities

and Marketing to understand their business requirements to enable the organisation to comply with the vision and broadcast requirements and obtain best financial returns on Tasracing products.

Elizabeth Carrol, Chief Legal Counsel, IP Australia As Chief Legal Counsel at IP Australia, Elizabeth thrives on supporting innovation through providing strategic legal advice to all areas of the agency. Elizabeth delivered a significant change management exercise in the provision of legal service, rewriting the operational plan to place client service and relationship building as the highest priorities and instituted regular meetings with high-use clients and empowered senior officers to take responsibility for their ‘portfolio’ area. Elizabeth is known to lead by example, reaching out to external stakeholders and implementing a communications strategy to reinforce the new approach. She moved the legal team from a culture of providing transactional legal advice to partnering with client areas, clearly communicating her vision of a legal team based on client service and focussed on appropriately managing legal risks. Her team has achieved a culture of working “in” the business rather than “on” the business, where they are asked to engage on projects from an early stage as partners to achieve optimal outcomes. a VOLUME 28, ISSUE 4 – SUMMER 2018 |

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LEGAL TEAM OF THE YEAR - LARGE EnergyAustralia

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Each member of the legal team is an expert in their profession, totally reliable, skilled at adapting their knowledge for application to new contexts, products and services and unfailingly capable of delivering under pressure. They are prepared to have the difficult conversations, if need be, to ensure that EnergyAustralia not only complies with the law, but also furthers our company’s purpose and values. All of this in the context of a transforming energy company in a dynamic and rapidly changing external environment. Chris Ryan, General Counsel and Company Secretary

bold, supportive approach characterises the EnergyAustralia legal team as true business partners of the wider business and one that is at the forefront of energy law. Now comprising fourteen lawyers (having recently welcomed one new lawyer and the team’s first lawyer under supervised legal practice) sitting within a broader Legal & Governance function that includes Company Secretary, Regulatory Compliance and support staff, the legal team advises and influences all levels of EnergyAustralia: from the Board of Directors and Executive Management Team (EMT), to the customer-facing staff and those working behind the scenes in power generation. During a time of unprecedented change and innovation in the energy industry, the EnergyAustralia legal team is regularly required to quickly adapt by identifying new ways to support increasing demand for legal services. This involves advising on new business activities and technologies and preparing for current and anticipated changes in a highly regulated business environment. In championing the term risk-based decision making, the EnergyAustralia legal team prides itself on providing commercial and risk-aware advice to help the organisation achieve its goals and advance its values. Two examples of this approach include firstly, the delivery of a two-day workshop with the top leadership of EnergyAustralia that sought to develop a framework for improved decision making across EnergyAustralia, known as ‘Breakfree.’ Secondly, the development of a number of tools that assist in identifying high-risk matters requiring early legal engagement. These and other initiatives including the implementation of efficiency and automation

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tools have resulted in sustained year-onyear savings in total legal spend. Through a consolidated panel of external law firms using an innovative engagement approach, EnergyAustralia’s total annual legal spend is now just 0.13% of turnover. Importantly the EnergyAustralia legal team practices an internal culture of engagement and support. Team members are encouraged and empowered to look after themselves, look out for each other and recognise each other’s achievements. This approach encompasses a number of continuing initiatives including supporting flexible work practices, celebrating better ways of working and offering training and development opportunities, including leadership programs for emerging and senior leaders. The team also actively participates in volunteering, wellbeing and social activities, and has leadership roles in key diversity and inclusion initiatives, including EnergyAustralia’s Women’s Network, Reconciliation Action Plan and LGBTIQ+ “Prism” Network. In accepting the award, General Counsel and Company Secretary of Energy Australia, Chris Ryan said, “it is a great honour to receive this prestigious award, which recognises the team’s capabilities, commercial acumen and backbone. Above all I am proud of the remarkable culture in our team.”

Also recognised on the night were the Large Legal Team of the Year finalists: Department of Foreign Affairs and Trade Through its Corporate Law and International Law Practice Groups, DFAT’s Legal Division (LGD) provides advice that is vital to DFAT and whole-ofgovernment decision-making on a range of issues ranging from Australia’s foreign aid program, to

the downing of Malaysian Airlines Flight MH17. The team engenders a culture that consistently balances legal obligations with strategic objectives to deliver solutions-focused advice. LGD demonstrated this when leading whole-ofgovernment negotiations with Timor-Leste in the first ever conciliation under the United Nations Convention on the Law of the Sea. The LGD legal team is committed to fostering a collegiate environment that engenders support for all staff. LGD is a departmental leader in facilitating flexible work practices with more than one quarter of LGD’s staff utilising a variety of flexible work arrangements.

HydroElectric Corporation (Hydro Tasmania) Eighteen months ago, the Hydro Tasmania Legal Services team embarked on a growth strategy that was focussed on building internal knowledge capital, reducing reliance on external legal resources and improving the efficiency and quality of legal service delivery. This growth strategy drove a number of business improvement initiatives, has significantly improved efficiency and has freed up legal resources to focus on more complex and strategic legal work. All members of the Hydro Tasmania Legal Services team have a documented development plan which captures learning goals, and a plan for achieving those goals. Development is undertaken in a variety of different ways, including practical, ‘on the job’ training where appropriate. One recent example was when the General Counsel spent time working alongside the energy traders in the business to develop relationships and learn more about energy trading. a

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LEGAL TEAM OF THE YEAR - SMALL Special Broadcasting Service (SBS)

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SBS legal is an intrinsic part of the SBS fabric. They are approachable, innovative and importantly, understands and practices the SBS culture and values which aims to inspire all Australians. Michael Ebeid AO, Former Managing Director & CEO 2011-2018

s a multicultural broadcaster in a rapidly changing media environment, the SBS legal team has demonstrated an innovative and agile approach to navigating the complex legal and commercial challenges befitting a public service broadcaster receiving both public and commercial income. Led by General Counsel Lesley Power, a member of the SBS executive team, the legal team consists of nine lawyers and legal operational Rights, archives and information management teams who proudly collaborate across seven separate organisational divisions within the organisation. The SBS legal team pride themselves on the provision of a supportive and agile legal service to the wider organisation. Over the past year the team has demonstrated this approach through the delivery of a range of initiatives that have provided fundamental value and increased awareness of legal considerations within the wider organisation. The team pioneered what they’ve termed the ‘legal pod structure, where small ‘pods’ of lawyers led by a pod ‘ambassador’ proactively engage with specific divisions to anticipate legal needs and ensure the pod is abreast of relevant legal and industry developments. The SBS Media Law Minute (MLM) was developed as an avenue to keeping divisions informed and represents bite-sized summaries of current issues, including practical ‘takeaways.’ The team have also created bespoke face-toface training courses for the team on relevant legal matters, while in keeping the fast delivery and increasing volume of cross-platform news content, SBS Legal offers practical prepublication advice 24/7 for the production teams. Further to these ongoing business improvements, over the past year, SBS legal has been tasked with providing critical advice

on a range of major projects that have been fundamental to meeting the organisations’ strategic objectives.

ACC Australia also recognises the Small legal team of the year finalists:

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L’Oréal Australia & New Zealand

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FIFA World Cup 2018: Embarking on a new partnership with Optus, SBS Legal was an integral part of the negotiation team working with key executives to ensure this deal met SBS’s strategic objectives and satisfied audience expectations. When broadcast plans significantly changed mid-World Cup, the legal team was called upon to provide quick and commercially sound advice, to ensure the continued coverage of this global event to an Australian audience. Digital Acceleration Strategy: SBS Legal has led the development and implementation of the SBS privacy framework, which is essential with the growth of SBS OnDemand. Governance: as a public service broadcaster established by statute, SBS Legal carefully balances legal obligations under relevant legislation with commercial opportunities.

As a visible and critical part of the organisation, SBS Legal play an active role in contributing to SBS’s culture of active inclusion. The legal netball team is a regular participant in the organisation-wide competition; the team is also an active participant in the SBS Mardi Gras float and the SBS volunteer program supporting local charities. Furthermore, as a team, SBS Legal is committed to continuous development and skill-building and team members are encouraged to actively pursue opportunities to give back to the industry and legal community. The team are regular participants in the SBS/Macquarie University Media Mentorship Program; has led and driven SBS’s Reconciliation Action Plan and are regularly invited to present at legal/industry conferences and present to law students.

L’Oreal’s legal team consists of three forward thinking lawyers, who work across two jurisdictions on legal strategy, leading legal innovation and championing privacy and data. Known amongst the business as offering efficient, timely and proactive legal advice, 93% of L’Oreal’s matters are managed in-house rather than by an external law firm. The L'Oréal ANZ Legal Team has also inspired the Global L’Oréal Legal Executive Committee and several other L’Oréal legal teams to embrace legal innovation and legal technology.

Melbourne Water Corporation The MW Legal team has a customer orientated approach to providing a positive experience for their internal customers. Taking their innovation cue from Melbourne Water’s focus on Continuous Improvement and Innovation, the team has transformed itself from being a legal help desk to providing targeted legal advice that has the most impact. One example of this approach to continuous improvement and innovation was the implementation of a system to control the manner and flow of work (no more briefs by chain emails) which provides internal clients with downloadable legal products to enable and empower them to get on with the job. a

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YOUNG LAWYER ACHIEVER OF THE YEAR Shannon Landers, Company Lawyer & Lease Manager at Cotton On Group

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Also recognised on the night were the Young Lawyer Achiever of the Year finalists:

I am incredibly grateful for the opportunities provided to me by my manager Alice Polglase and the Cotton On Group generally, who support me to provide high-level, strategic and commercial legal advice, enabling me to do a job that I love every day.

Courtenay Zajicek, General Counsel and Company Secretary, Jenny Craig As the sole, in-house legal representative for Jenny Craig, Courtenay has managed and contributed to a number of key corporate projects within the organisation over the past year. This has included preparing and implementing HR manuals and templates and mandatory training and networkwide audits of franchise businesses for compliance with the Vulnerable Workers Act. She also successfully managed several employment and business mediations to avoid lengthy and costly litigation, all while managing the local due diligence process for a large international business sale and acquisition. Courtenay strives to contribute to the broader legal industry, in particular to the in-house legal community. She has been invited as a panel speaker at conferences, written a number of articles and nominated to act as a mentor for other in-house legal members.

mindset that extends beyond legal input to encompass a truly value-adding approach to complex commercial matters characterises the approach Shannon Landers brings to the Cotton On Group. Her commercial and operational understanding was amply demonstrated when negotiating the development of Cotton On’s new Avalon Distribution Centre. This new facility was custom built by Linfox with Cotton On taking up occupancy of the site upon completion. Through the negotiations Shannon demonstrated her commercial and operational understanding and negotiated the contract management process across Executive stakeholders on both sides to ensure the desired commercial outcomes were achieved. At a strategic level, Shannon has had integral involvement in the company’s entry into a number of new markets including the United Kingdom, Botswana and Namibia. This significant international expansion demanded Shannon undertake a rapid familiarisation process in new country entry, privacy law as well as a myriad of unique legal matters pertinent to the relevant markets. Shannon has also been integral in Cotton On Group accessing new wholesale channels where her input into contracting processes has

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been critical in ensuring the complex contracts and operational input has been provided in a manner that allows the partnerships to grow successfully. In addition to the legal skills that Shannon brings to the team she is an active leader within the group being responsible for management of the leasing team which requires her to be operational and business focussed. Personal leadership is a strength of Shannon’s and she is a willing mentor to a number of junior team members. Shannon is also active on NFP boards external to Cotton On which provides Shannon an opportunity to contribute to community groups and strengthen her governance skills.

Georgina McKay, Department of Foreign Affairs and Trade ‘DFAT’ Having worked across three teams in DFAT’s Legal Division (FOI and Privacy Law; Consular, Passports and Protocol Law; and Transnational Crime) in just two and a half years, Georgina has proven she is adept at transferring her skills and comprehending complex areas of law in a short amount of time. In this role, Georgina provides legal and policy advice regarding Australia’s transnational criminal law obligations and assists in coordinating DFAT’s engagement with domestic agencies, foreign partners, and regional and international bodies. Georgina demonstrated her leadership ability as an in-house lawyer and her understanding of client needs when taking initiative to make legal information accessible to clients. Georgina redeveloped the legal intranet page and championed the development of concise information sheets for clients that deal with commonly occurring legal issues. This has empowered clients to consider legal risks when making decisions, and to identify when they need further legal advice. a

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EXCELLENCE IN CORPORATE SOCIAL RESPONSIBILITY

Cotton On Group

ith a mission to create 20,000 educational places by the year 2020, the Cotton On Foundation is dedicated to empowering youth globally through quality education. Such a worthy cause combined with a single-minded determination has driven Shannon Landers to ensure the Cotton On Foundation delivers a maximum benefit to its beneficiaries through education projects in Southern Uganda, South Africa, Thailand and Australia. In spearheading the work of the foundation over the past year, 2018 Young Lawyer Achiever of the Year, Shannon together with her colleagues Alice Polglase (Head of Legal) and Roxanna Tabari (Graduate Lawyer) have volunteered significant time and effort, outside of their commercial roles, into ensuring ongoing compliance with global charitable laws and therefore maximising the impact of the Foundation. This involves ensuring the provision of commercially astute assistance to the team to ensure the foundation receives every possible cent by operating in the most tax efficient way possible. This equally assists the profitable side of the Cotton On group in effectively donating to the Foundations projects. Furthermore, Shannon and her teams’ determination to support the foundation has seen them identify solutions that regularly side-track the charitable industry. Shannon and her team strive for flexibility in the group structure, even by partnering with external philanthropic organisations to achieve results. One example is when the foundations’ legal structure was hindered by its deductible gift recipient status. Shannon worked with Rotary so that the much-needed funds could still reach projects in Uganda, while maintaining compliance for the Foundation and tax efficiency for the Group. Shannon and her team also watch the legal trends in the industry and proactively restructured the foundation to obtain the most effective charitable status to operate without the partner. This is one example of where Shannon and her team’s strategic thinking and rounded commercial advice, over and above her legal role, together with their “never give up until we find a solution” attitude have assisted the Foundation.

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We work very hard as a legal team to keep global charity advice in-house and minimise external spend to ensure that every dollar can go back to the Cotton On Foundation and Cotton On Group Community Projects and the people that need it most. Shannon Landers, Company Lawyer & Lease Manager at Cotton On Group

A significant driver in Shannon’s work on the foundation was a 2017 trip to Southern Uganda where she visited Cotton On Foundation projects and witnessed firsthand the impact they were having on local communities. Having returned from the trip and Shannon openly admits it strengthened her resolve to help ensure the Foundation achieves its mission. Outside of the Cotton On Group foundation, Shannon is a volunteer member of the Special Olympics Australia, Barwon Committee. She also holds a volunteer board position of Leisure Networks Inc, a local disability service provider.

Also recognised on the night was the other Excellence in Corporate Social Responsibility finalist: Pernod Ricard Winemakers Pty Ltd Pernod Ricard Winemaker’s legal team demonstrates its corporate social responsibility commitment through a range of activities; a “green office” challenge, environmentally-responsible projects, pro bono work, volunteer events and the enforcement of responsible policies and practices. The team has implemented its own initiatives to support suppliers with their social responsibility through the development of template contracts that ensure suppliers are committed to a policy of social responsibility when providing goods or services. The team also engages with marketing agencies and other parties to ensure products are marketed in a way that is responsible towards consumption, minors and the effects of alcohol. The team also launched an internal project to reduce waste, and the initiative has since been rolled out across the country to form part of PRW’s Green Office Challenge. a

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MENTEE OF THE YEAR Andrew Lee, Senior Legal Counsel, Nissan Motor Co. (Australia)

rimming with energy, passion and self-direction, Andrew has proved a remarkable mentee and his demonstrated growth over the mentoring program proved inspiring to his mentor. Andrew entered the program, having given considerable thought to what he wanted to achieve and quickly worked to hone in on his key development focus areas. This began with a frank and open discussion about his career journey to date, his strengths and limitations. Of his own initiative, Andrew documented these development items, their status and next steps in a living mentee development plan. This became the checkpoint document throughout the year. For Andrew, every roadblock was an opportunity to reflect on and each monthly meeting yielded positive progress and new insights. Andrew had clear insight into his development areas and he developed rapidly through active self-awareness and insights. Outside the monthly mentor/mentee meetings, Andrew completed a range of tasks suggested to him by his mentor. These included personal study into how he allocated his time, a skillset gap analysis, the implementation of on-on-one meetings with his direct manager and reflection on the internal dynamics of his business to get better outcomes. Through this program Andrew’s inner leader visibly emerged. He confidently promoted legal operations innovation initiatives and championed a business wide practice management initiative. a

Also recognised on the night were the mentee of the year finalists: Sarah Daniell, Senior Legal Counsel, St John of God Health Care Theo Kapodistrias, Lawyer, University of Tasmania

MENTOR OF THE YEAR

Robert Stribling, Head of Legal, Eni Australia Limited

atural leadership demonstrated through encouragement, sound advice, positive reinforcement and responsiveness characterised Robert Stribling’s approach to his mentoring role in the ACC Australia mentoring program. Throughout the program Rob worked with his mentee and challenged and encouraged her to investigate alternative career paths and pursue her aspirations, more so if outside her comfort zone. This included non-legal roles and senior, more formal management positions. Where possible and appropriate, Rob provided access to his network of contacts to generate further advice and input. With a self starting, talented and motivated mentee, the outcome was excellent. Success for the mentee and greatly satisfying for Rob in seeing his mentee succeed. Rob’s approach is to support and encourage, allowing his mentee to develop her own opinions and ideas, while providing sound advice based on his experience and expertise - an effective sounding board. a

Also recognised on the night were the mentor of the year finalists: Steve Miller, General Counsel and Company Secretary, Telstra Super Pty Ltd Leanne Clark, Senior Legal Counsel, Commonwealth Bank of Australia 28

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DEVELOPMENTS IN LITIGATION TECHNOLOGY: EARLY SLEUTHING AND SCOPING Emerging developments in litigation technology and increasingly affordable analytics software can save legal departments time and money through an enhanced and accelerated understanding of the critical issues involved.

n litigation, the side that gets the earliest and best understanding of the underlying facts and how the evidence supports or undercuts key witnesses, has a distinct strategic advantage. Fortunately, several trends are converging that make early case sleuthing and scoping more affordable and feasible than ever, for cases of all sizes: ••

•• ••

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•• ••

Cloud storage is increasingly inexpensive and highly elastic. Large volumes can be processed on demand for literally pennies per gigabyte without infrastructure investment. Geo-specific cloud storage can keep data in-country, avoiding many GDPR problems. Secure bandwidth has increased. Large sets of data can be moved quickly, securely and economically without physically shipping computer media. Analytics software is becoming more ubiquitous. Corporations don’t have to load email and documents onto expensive final review platforms to have comparable functionality, e.g., predictive coding, concept wheels, email threading, deduping, text search. Project-based virtual teams can come together just for the life of a project and include the expertise needed for any part of the project, e.g., database discovery or dealing with legacy applications. There is no need for large, ongoing headcounts. Screen-sharing applications permit quick, spontaneous meetings and information exchanges. Litigation teams can be assembled globally and be much nimbler than only face-to-face meetings. Pricing models have shifted from the old per-gigabyte or perdocument models. Experts now provide technology at either no additional cost or may bill for direct out-of-pocket cost for things like Amazon Web Services hosting or processing fees—minor expenses compared to final review platforms.

These trends offer opportunities and solutions with distinct advantages over traditional methods of document review and predictive analytics.

Early sleuthing and scoping Being able to collect, process and analyse email and electronic documents for little or no cost allows lawyers to understand what they have when deciding whether to settle or to negotiate on a preliminary scope for e-discovery. It also provides metrics to use in such negotiations. The truth is that if corporations use people who understand robust software, they can find whatever they need in just about any collection of documents, without a lot of cost and heartache. With the early investigation and scoping approach to e-discovery, outside counsel will be reading only relevant documents for intelligence and understanding, not just to make ‘in’ or ‘out’ relevancy decisions or apply ‘confidential’ or ‘privileged’ tags to documents. Because early scoping is affordable, attorneys can do this as soon as the demand letter arrives. They can know before the case is filed what happened, who said what to whom, and whether to fight or settle. For every pleading and subpoena, in-house counsel can quickly and inexpensively scope the task at hand by collecting the email for two or three highly relevant custodians and quickly see with whom they discussed the topics at issue. This information can be used to not only negotiate the scope of 30

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discovery with the government or adversary, but also to inform you about who else really should be included as a custodian, based on the electronic evidence, not just supposition. After the work is done and the relevant documents are produced, any questions by opposing counsel as to completeness can be quickly resolved with a screen-share meeting with the lawyer who did the work, explaining the strategy and process for locating the documents. As any trial lawyer will say, the story of how the process worked is much more defensible than any measure of recall or precision through sampling, which will always be less than 100 per cent.

Examples Here are some scenarios of how this new approach to technology-assisted awareness and processing can work. Product liability—eye and skin irritation. You have a potential product liability situation where employees of a customer have complained about itching eyes and skin from using the product at workbenches. Work Health and Safety investigators have requested documents and your client is worried about lawsuits. Under traditional ‘wait and see’ litigation discovery practices, discovery would have been put off because of the expense. With today’s technology offerings and project-based teaming, you can collect email and documents from your key employees without incurring costs, and process them into a document repository with investigative analytics and sophisticated search. This could cost as little as $20 per gigabyte, per month, with no additional fees for generating TIFFs, deduping, threading emails, or persistent highlighting of keywords and productions. Lawyers skilled in using the platform’s software would investigate the documents collected and provide you and your client with a ‘who’s who’ or ‘key players’ list, a chronology and meaningful intelligence regarding what your client knew, or should have known, about itching eyes and skin from use of its products in a matter of days. Total professional fees at $200 per hour are less than $5,000.

Additional scenarios Here are additional scenarios and how they might pan out using a strategic approach that leverages lawyers skilled in using state-of-the-art document analytics software in an elastic cloud computing environment: ••

••

Claim evaluation. You receive notice of a claim. By identifying principal players in the matter and doing a preliminary collection and processing of their email, you can quickly get a preview of how the case will play out. The costs to collect and ingest the email for a few of the individuals involved and to find out what happened for many cases, is less than $1,500. As noted above, some consultants using Amazon Web Services do not charge for collecting or processing data, instead charging hourly for technical skills in using the software and finding the meaningful emails quickly (in some cases within a few hours). Key employee departures. A key employee suddenly leaves. Collecting and processing their email can be done for no cost and once it is in a cloud-based repository, used by someone skilled in its search features,

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••

the departed employee’s email can be quickly organised and managed as needed, for less than $2,000 in most cases. Subpoena responses. Responses to information and document subpoenas that might have run up costs and fees over $20,000 can now be responded to for less than $5,000, including processing, hosting, review, tagging and production.

BASIC E-DISCOVERY COST CONTROL Here are some basic things that can be done to greatly lower costs without compromising quality. ••

Potential Technology Assisted Review (TAR) tunnel vision An overemphasis on TAR (a.k.a. predictive coding) to solve discovery-related issues can lead to two types of tunnel vision: ••

••

Tool focus. Focusing on the predictive coding type of TAR (classifying sets of documents based on classifying a subset of them) can lead to ignoring other proven tools like concept clustering, domain name analysis, social network analysis or advanced search techniques. Overemphasis on review. Focusing on the review phase can cause lawyers to overlook opportunities for both analysis and understanding much earlier in the litigation process. Document review may not take place for many months, if not years, after the suit is initiated, and that is simply too late to go hands-on with the documents. To the extent that corporations find TAR to be a useful way to gain understanding, they should consider using it before documents are placed in a final review platform. They can also use it to evaluate not just outgoing productions but productions from other parties as well.

Conclusion

•• ••

••

Scoping the extent and validity of litigation claims provides huge strategic advantages in knowledge and reduces cost to the great benefit of the corporation. Best of all, it is affordable and practical.

DeNIST. As soon as possible, identify and exclude files that are created by and obtained from software providers as part of their software installations and updates. There is no evidentiary value in these files. The National Institute of Standards and Technology maintains a Software Reference Library that lists these files and their hash values that can be used to identify them. DeDupe. Don’t have multiple instances of the same files repeatedly reviewed by different people. It’s wasteful and you risk inconsistent production decisions. Thread emails. Emails and attachments that are part of the same email conversation or thread must be tethered together so that they are read together by one person. This provides the overall context of the whole conversation and avoids inconsistent coding or designations. Be transparent early. If sweeping discovery just doesn’t make sense, get on the phone with opposing counsel and say what you’re planning to do. Use screen-share software to show examples of what you’re talking about. Get a divorce from per gigabyte pricing. Just as there is growing recognition that companies are better served by flat billing as opposed to per gigabyte pricing, e-discovery should be purchased on a largely flat-fee basis. Use benchmarks. Participate in ACC and other forums to exchange information about what recurring tasks should cost. Use that information in negotiating price.

E-DISCOVERY PROFICIENCY QUIZ Lawyers who can’t make full hands-on use of the panoply of tools available to analyse electronic discovery are like dentists who can’t personally use drills. They lose the ability to interact with the data and quickly gain insights from it. Here are some basic tasks that lead investigators or attorneys should be adept at handling: Lead attorney/investigator Each of the following tasks, other than the keyword testing, should take less than 10 minutes.

Task

Significance

Domain-specific usernames. List all usernames associated with a specified domain name and the number of emails to/from each user.

This task is critical for obtaining a basic understanding of who the key players are and what the relationships are among them.

‘Private’ email addresses. Identify all usernames associated with ‘private’ email accounts, i.e., non-corporate email accounts.

Private emails are sometimes used to circumvent monitoring of corporate accounts. E-discovery practitioners should be able to identify the leading ‘private’ email providers without being told, e.g., Gmail.com, Hotmail.com, Yahoo.com, Comcast.com and Verizon.net.

List name labels. Identify all the name labels associated with a given email address, e.g., the name labels associated with jsmith@ enron.com might be ‘John Smith’, ‘J. Smith’, ‘Jack’ or ‘JS’.

Name labels are added by people who create contacts in contact lists. There can be as many name labels as there are people who have a given email address as a contact. Listing name labels helps identify nicknames or alternate forms of names that sometimes appear without the email address or domain for subsequent analysis.

Recipient domains. Identify all domain names that a specified person has sent emails to, or all emails between certain individuals and/or organisations.

Without the ability to see organisations or people with whom certain individuals of interest have been communicating, it’s hard to see overall communication patterns.

Communication frequency over time. Present a frequency analysis of the number of emails a specified person has sent or received emails within a given period.

In litigation involving key dates, a spike or gap in communication patterns can be indicative of underlying behaviour.

Private cloud storage. Find all documents mentioning online data storage domains used for storing or exchanging data.

Cloud storage providers like DropBox, Google Drive, Cloud Drive, OneDrive, OneBox can be used to store data off corporate networks. Identifying where those terms appear in a data collection can be a way of identifying potentially additional data sources. The person doing the searching should be able to identify these domains/product names without being prompted or informed.

False positive keyword testing. Conduct keyword analysis to identify search terms that retrieve false positives.

Every data set is different, and ‘dirty’ search terms that unintentionally retrieve false positives can inflate costs enormously. VOLUME 28, ISSUE 4 – SUMMER 2018 |

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ORGANISATIONS PROCESSING E-DISCOVERY DATA Task

Significance

Benchmark

Ingest the electronic files located at an indicated URL.

Nimbleness is a key part of using technology to gain strategic advantage through earlier, better awareness. Lawyers can’t get ahead of things if they can’t quickly start analysing the underlying data.

1 hour

View and assess exceptions in the ingested file, i.e., things that couldn’t be indexed.

Lawyers should be able to look at and assess documents that did not process because of passwordprotected/encrypted files, corrupt/ unreadable files and image-only files. Usually these files are not relevant and it would be a waste of money to try fixing the issues and process them.

1 hour

Identify and remove files on the NIST list of standard software files (provided by the National Institute of Standards and Technology in their Software Reference Library).

Lawyers should be smart enough not to process program files distributed by software providers like Microsoft and Adobe. Otherwise charges are inflated and the associated data collections are cluttered with items with zero evidentiary value.

10 minutes

Describe what happens to the data when the case is over.

It is very important that the lawyers and/or consultants you use have a case closing checklist, similar to the one provided in an earlier ACC Docket article ‘The Case is Closed. Where Are Your Documents?’ May 2013, pp. 57–67.

10 minutes

An original version of this article appeared in the October 2018 issue of the Docket. Seth Eichenholtz

TEN STEPS FOR EARLY AWARENESS AND IDENTIFYING RELEVANCE/NON-RELEVANCE There is no single way to gain awareness and select responsive documents. Here are steps often recommended by Jeff Johnson, a Kansas City e-discovery consultant, that depend on the circumstances of each case. These steps are typically applied prior to loading content on the final review platform.

1. Spam and non-relevant standard email reports and messages. Review emails sent to large numbers of recipients and remove non-relevant messages. 2. Concept clustering. Cluster documents based on textual content—it may be possible to include or exclude large clusters of documents based on examining just a few of them. 3. No-response emails. Significant emails tend to occur in email threads with replies and forwards. Emails without a response can be clustered, so non-relevant emails can be removed. 4. Inclusionary search term testing. Based on what has been learned so far, test initial key terms and logic for responsive documents across key custodians, noting related terms. 5. Exclusionary search terms for non-responsive items. Perform iterative non-relevant key terms analysis and remove non-relevant documents. 6. CAL. Use continuous active learning TAR as a way to pinpoint key documents prior to sending files to review the platform provider. 7. Specify embedded object treatment. Evaluate whether to create separate ‘documents’ for each embedded object, e.g., a spreadsheet graph embedded in a Word document. ‘Exploding’ embedded objects to create additional documents can clutter the |

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review database and inflate data ingestion and storage costs. The review collection should be audited to ensure specifications were followed. 8. Largest sized files. Examine the largest sized files to avoid paying excessive data loading and storage on final review platform (identify large pdfs, graphics, video). 9. Sentiment analysis. Review documents that contain highlycharged emotional content, e.g., profanity. Labour or employment cases and contract disputes often involve angry or accusatory email that help tremendously to prioritise and scope review. 10. Visual classification and glyph search. Visual classification technology can cluster visually similar documents without using or requiring textual analysis. It is ideal for some collections and serves as cross-check on text-based tools for any collection. The same technology enables searching for key graphical elements, e.g., logos, stamps, graphics. a

Across a fifteen-year legal career Seth has held a range of specialist e-discovery positions including as an e-discovery consultant. Now based in New York, Seth currently holds the position of head of electronic discovery at Mastercard. There he manages a range of policies and procedures related to electronic discovery services/activities, including information governance.

Tim Donovan A highly experienced intellectual property lawyer, Tim has held a number of positions as general counsel in large and small corporations in the technology and healthcare sectors. He is currently a legal advisor to Netsmart, a healthcare software vendor providing management process solutions and electronic health records.

Anne Kershaw A lawyer and consultant with a passion for e-discovery and complex data management solutions for organisations, Anne co-authored The Judges Guide to E-Discovery, teaches at Columbia University and has written a number of articles for ACC on discovery and information governance issues for organisations.

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TECHNOLOGY AND TRANSPORT: MOVING YOU IN(TO) THE FUTURE In the last decade, technology has changed the game across different industries and transport is no exception. As the world’s largest private provider of public transport, Transdev has been an active participant in global developments and every day is seeking new ways to introduce these innovations to the Australian market. Like most technological advancements, the regulatory framework is secondary to the concept development, however it plays a critical role in ensuring safety and ultimately a functional society.

echnology advances have fundamentally changed the expectations and delivery of public transport. While there will always be an important and necessary role for mass transit, transport providers such as Transdev have broadened their thinking. Instead of simply moving thousands of people at one time through traditional trains, trams and buses, public transport is becoming more personalised, connected and more responsive than ever before. With your phone you can plan your trip (including connections to other services), track your transport mode in real time, better estimate your wait time and provide instantaneous feedback to the operator and broader public. On demand services and autonomous shuttles are but two areas front and centre of the transport evolution where the law is changing fast to keep up with innovation and public demand.

On Demand Services What does it mean? On Demand Transport (ODT) refers to personalised services that are ready when you are and go where you want to go. ODT can be booked immediately or in advance, usually through an app. The term incorporates both ridesharing services (such as Uber, Lift and Olé) as well as the traditional taxi. Where Transdev is rising to the challenge is in relation to ODT en masse - something more than simply ‘pooling’ with other members of the public heading in a similar direction. ODT has a real role to play in network planning to supplement mass transit. It meets specific travel needs with its service of low density areas, areas not served by a regular lines or during times of low demand. Proposed in addition to the existing transportation network, it addresses three commitments: •• help connect remote areas (for example isolated suburbs or new growth suburbs not yet serviced by mass rail or bus); •• offer flexibility and freedom in everyday mobility (including outside of peak travel times, populations with atypical schedules); and •• help improve social contact through solutions for everyone (including for people with reduced mobility or by joining suburbs that may have otherwise required a taxi rather than public transport).

What is the law in Australia? Since Uber hit the Australian market, state governments have been progressively updating the law to ensure regulation of technology based ridesharing schemes. Almost all states and territories have now legislated policy in this area, introducing regulatory regimes that require accreditation as an operator or booking services provider as well as driver authorisations and vehicle safety standards. In some jurisdictions, there is also a levy payable by operators per trip to go towards compensation for taxi licences. While NSW and Victoria

have passed new legislative regimes governing ODT services, other States have dealt with accreditation as an amendment or exemption to existing passenger services legislation.

How is Transdev involved? Transdev has ODT operations across the globe, operating in over 150 locations in France alone. In Australia, Transdev currently operates two pilot on demand services in Sydney in partnership with Transport for NSW: 1. RIDE PLUS: a ‘point-to-hub’ or ‘first mile / last mile’ On Demand Transport trial operating in Manly and surrounds in a dedicated On Demand Transport zone that acts as a feeder service to larger public transport hubs. 2. TRANSDEV LINK: a 'point-to-point' On Demand Transport trial operating in the Sutherland Shire that allows you to book a vehicle to pick you up from home or a convenient nearby location, to take you to a local transport hub or landmark. The Transdev legal team were closely involved in preparation for these trials. They assisted with interpreting legislative requirements for the services; supported the application for accreditation under the newly introduced Point-to-Point Act 2016 (NSW), worked closely with the IT team developing the booking application and developed the passenger terms and conditions.

Autonomous vehicles What are they? Autonomous vehicles (also known as self-driving or driverless) are vehicles which can guide themselves without any human participation. Autonomous vehicles may be connected (talk to the vehicles around them) or use another system that uses cameras or laser sensors such as lidar. There are a range of benefits predicted to come from the widespread introduction of autonomous vehicles, including: •• Reduced human error and therefore reduced accidents and safer roads; •• Reduced fuel consumption, emissions and brake wear due to more efficient braking and accelerating; •• Reduced inner city congestion (depending on how utilised); and •• Improved mobility for those who are unable to drive due to disability or age. However in addition to these benefits there are also a number of risks and options in the rollout. Part II of our article will discuss these risks and provide greater insight into what this complex regulatory environment must accommodate. But first let’s understand what is possible… According to the Australia and New Zealand Driverless Vehicle Initiative (ADVI) there are 5 levels of driverless vehicle: VOLUME 28, ISSUE 4 – SUMMER 2018 |

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What is the law in Australia? So while the future may be here in terms of technology, legislation is struggling to keep up. Some states have embraced the move towards AV and are endeavouring to make this a reality. At present, it is not currently legal for autonomous vehicles to be on public roads without a human driver and any travel must be with a government exemption (through private trial). The below table provides a snapshot of where the states are heading with the development:

Jurisdiction QLD

Government Action The Qld Government has established and funded a four-year Cooperative and Automated Vehicle Initiative (CAVI) running from 2017-2021. This initiative has four main components, with on-road testing due to commence in 2019.

Transport Legislation Amendment (Automated Vehicle Trials and Innovation) Act 2017 (NSW) passed governing AV trials. NSW

Transport for NSW’s Smart Innovation Centre are performing a smart shuttle trial in Sydney Olympic Park, as well as running two regional AV trials in Regional NSW, both in Coffs Harbour and in Armidale (Transdev is a project partner in this trial).

Road Safety Amendment (Automated Vehicles) Act 2018 came into force on 28 February 2018. VIC

The Victorian CAV Trials program investigates how connected and automated vehicles (CAVs) interact with motorway infrastructure. AV projects announced include an AV trial by ARRB, ConnectEast and LaTrobe University and a Transurban and VicRoads partnership project to assess readiness for highway automation on the Monash/Citylink/Tullamarine corridor.

Motor Vehicles (Trials of Automotive Technologies) Amendment Act 2016 (SA).

The SA Government has established the Future Mobility Lab Fund worth $10 million over three years from 2016 to provide funding to projects that demonstrate, develop, or contribute to the applied research of future mobility technologies.

ACT

The ACT government is supporting a two year AV trial called CANdrive to improve safety using driver monitoring technology.

RAC WA in partnership with the Western Australian State Government, will trial several AVs produced by French company NAVYA.

The NT government completed a six-month trial of an EasyMile shuttle bus at the Darwin Waterfront in November 2017.

TAS

Nil.

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>> Swedish car manufacturer Volvo has unveiled an all-electric, self-driving vehicle that can double up as a mobile office, bedroom or living room.

Where to from here? In late 2017 and early 2018, Transdev partnered with EasyMile to take the EZ10 driverless shuttle on a roadtrip around Australia, giving people a chance to try the technology firsthand in partnership with local authorities. The EZ10 is a Level 5 autonomous vehicle, fits 6 seated or 12 standing and is fully accessible. It is a functioning example of what the future of mobility for end users looks like, combining the benefits and flexibility of the technology, with the economy of group transportation. In Paris, Transdev is already operating electric vehicles with autonomy level 4. This is open to the public and a driver is only required for manual override function. This operates on open roads, through busy intersections and over pedestrian crossings, and is supplemented by real-time remote supervision in a control centre.

With Australian cities often cited as the most liveable in the world, technology and transport cannot rest on its laurels. For a city will only truly thrive when it has embraced public transport and the technology that best supports its growth. The future is here and it is now – the road to innovation is clear but we have only just begun to understand what is possible and what more is required to make this a reality. Stay tuned for Part II of Moving you (in)to the Future where we will discuss legal issues including insurance, liability, data, cybersecurity and legislative amendments which help move these concepts out of Silicon Valley and into our cities and day to day lives. a Kara Mc Gowan

However, driverless vehicles should be considered the start of the evolution, not the final destination. Transdev is planning a number of new operations in coming months. Within Australia, these are predominantly on private or government land such as University sites and airports; however the opportunities are endless when the ‘driver’ is no longer required to drive. This is when transport moves beyond the realms of moving from A to B and instead becomes a question of what you will do with your time between A and B. Imagine a world where your hour commute to the office could be far better spent than simply a teleconference on blue-tooth. Instead you could meet a colleague in one shuttle for a coffee, do a workout in another or alternatively spend the hour working in a truly mobile office complete with desks, audio visual screens, or printers. This is the future and it is here and now. We need to invest the time and energy into developing legislation to support these initiatives. Australia’s productivity is dependent upon it, and as a part of the developed world and we need to be at the forefront of embracing the future in an organised manner that ensures uncompromising safety.

As General Counsel of Transdev Australasia, Kara is responsible for advising Transdev’s rail, bus, ferry and light rail operations in Australia and New Zealand. Kara began her legal career with Clayton Utz and before joining Transdev, enjoyed in-house roles with both Coles Myer and Australian Unity.

Pictured are few examples of where companies have already created prototypes and concept vehicles:

Emily Jordan-Baird As Senior Corporate Counsel to Transdev Australasia, Emily provides legal advice across a range of new and exciting areas of public transport. She is head privacy officer across the Transdev entities and, with the support of Transdev, has just completed her LLM at Monash University.

>> Robotics startup robomart is the 'world's first self driving store'. Creating the supermarket isle on wheels, customers simply tap a button, unlock the doors and shop for the products they want.

With assistance from legal intern, Sarah Pervaiz.

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THE BLOCKCHAIN: HYPE OR REVOLUTION? The creation of blockchain technology has been compared to the creation of email and the internet. Whether or not you agree with this comparison, there is no doubt that organisations around the world want to know more, and lawyers should share their knowledge.

blockchain is simply a record of events that have occurred. Unlike a traditional database, the ledger is not stored on a single computer, where it can be vulnerable to attack. It is instead distributed across hundreds, or even thousands, of computers that store identical copies and control how new entries are added. For a new event to be recorded on the ledger, the distributed computers must first validate the record to ensure it isn’t fraudulent. If a transaction is validated, the event is recorded on every copy of the ledger, where it is permanent and unalterable. Consider a scenario where Jim agrees to give Mary his car in exchange for one bitcoin. Before Jim agrees to transfer the title to his car, he wants to make sure that Mary actually owns that bitcoin and hasn’t transferred it to someone else beforehand. When Mary transfers the bitcoin to Jim, Mary effectively asks the distributed computer network to validate, using their copies of the ledger, that she holds that bitcoin. Once this is validated, the bitcoin transfer to Jim is recorded as a new event on every copy of the ledger. Although the ledger is held by many third-party computers, only Mary and Jim ever hold the bitcoin, because of the private keys they hold to read the encrypted data. Therefore, there is no need for a trusted intermediary such as an escrow or bank.

Rapid adoption of blockchain The blockchain revolution is moving at a pace at which the law is struggling with. While regulators take a ‘watch and wait’ approach to this emerging technology, companies and governments around the world are moving forward and adopting the blockchain to solve a myriad of critical issues. With the increasing adoption of blockchain, it is imperative that corporate counsels understand how it works, how it is being used and what risks their clients need to consider. Issues relating to common law contracts, privacy and data security, and managing liability and risk are just some legal complexities that will arise as blockchain matures and is adopted more broadly.

How your clients are using blockchain The concept of the blockchain was born out of a 2008 White Paper written by a pseudonymous author, Satoshi Nakamoto, who posited a currency known as bitcoin that operated on the very first blockchain. This ‘cryptocurrency’ was decentralised and independent of any government or centralised bank control.1 While the identity of Nakamoto remains unknown, he published the blueprint to his bitcoin blockchain, which seeded the creation of over 1500 different blockchains that extended its use beyond the financial industry to solve many complex problems across a variety of sectors. In the private sector, British Airways announced that it was trialling a blockchain solution called VChain to completely streamline its check-in 36

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process.2 This blockchain is used to verify personal information and the validity of travel documents, without the need for sharing the information with trusted third parties or storing the sensitive information on a central database. In China, a large milk manufacturer has combined the blockchain with Radio-frequency identification (RFID) anti-counterfeit labelling practices to help consumers determine the source of its products and verify its authenticity.3 Around the world, the public sector has also seized opportunities to trial this technology in various capacities. The governments of Sweden, Russia, Georgia and Brazil are among a few countries trialling the blockchain to manage their respective land title registries. These countries intend to replace long-standing deed systems with a single system for land transfers and ownership.4 In Australia, the ASX announced its intention to replace its legacy CHESS system with a blockchain-based system for managing its $2 trillion equities market by 2020.5 Despite its conservative approach to new technologies, the health industry is also increasing its adoption of blockchain technologies to manage patient data and records. A PWC report revealed that 49% of global healthcare companies are developing blockchain solutions for a variety of uses, ranging from patient record management to prescribing and dispensing medication.6 These are just a few examples of organisations and sectors voluntarily disrupting their own ways of working to adopt blockchain.

Common law contracts and smart contracts One use of the blockchain that may excite and disrupt the legal profession is the smart contract. The term ‘smart contract’was first coined by the computer scientist, Nick Szabo, who described it as being ‘a set of promises, specified in digital form, including protocols within which the parties perform on [these] promises’.7 In 2013, Vitalik Buterin developed the second blockchain after bitcoin, called Ethereum, which combined the concept of Szabo’s smart contract and Nakamoto’s bitcoin to provide a blockchain primarily designed to facilitate the creation and operation of smart contracts. From a legal perspective, smart contracts are not necessarily common law contracts, and must still satisfy the basic elements of a contract to be valid. It is not always easy to determine whether this is the case, as some characteristics of smart contracts are unique. Smart contracts are often entirely in computer code and parties may elect to be completely anonymous, a feature facilitated by the incorruptible nature of blockchains. Smart contracts may also be crossjurisdictional and, unless parties elect a jurisdiction, it may not be apparent which court has jurisdiction to handle disputes. It will almost certainly challenge courts who may need to shoehorn legacy contract law into an entirely new way of transacting. With the Electronic Transactions Act 1999 (Cth), mirrored in each State and Territory legislation, Australia has adopted a relaxed approach to recognising the validity of electronic contracts. The legislation was created to recognise that transactions recorded and effected electronically are not, by that reason alone, invalid.8 Several non-legal organisations have already started to offer services that allow parties to design and ‘draft’their own smart contracts.9 Agrello, Contract Vault and Ether Party are just a few providers who offer platforms for people without

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legal or computer science backgrounds to quickly prepare and execute legally binding smart contracts. It may not be long before judges are reading ‘if’and ‘then’ statements in a programmer’s code instead of the carefully crafted clauses and headings of a contract lawyer.

Privacy and the blockchain Commentators and technologists became more interested in the interplay between privacy regulations and the blockchain when the European Union’s (EU) General Data Protection Regulations (GDPR) commenced in May this year. One benefit of the blockchain, which may be at odds with privacy legislation, is its immutable nature. You will recall that once a transaction is recorded on the blockchain, it is permanent and cannot be erased. While this feature is a tenet of blockchain technology, it flies in the face of Article 17 of the GDPR. This provision provides EU data subjects the right to be forgotten and, under certain circumstances, requires a data controller to erase any personal data it holds about them. While it may be easy to dismiss this as a problem for European countries, the borderless nature of the blockchain and the unprecedented extraterritorial effect of the GDPR makes this an important consideration which Australian lawyers should consider. Similar concerns surround Australian privacy laws. Companies looking to trial blockchain should start to consider how local privacy laws will affect their solutions, particularly if they decide to store personal information. While it is probably too early for courts and legislators to specifically deal with blockchain, Australia is leading the way with privacy regulations. The Australia Standards recently made recommendations to the International Organisation for Standardisation, stating that privacy, security and identity issues should be prioritised as the industry develops uniform blockchain standards.10 It is likely that Australian privacy law will be more malleable than the GDPR when it comes to regulating the blockchain. Under the federal privacy regime, the source of these obligations is in the Privacy Act 1999 (Cth) (Privacy Act), including the Australian Privacy Principles (APPs) that govern many organisations around the country. It’s important to note that just because data stored on a blockchain may be encrypted, it does not mean that it cannot be reasonably identifiable and therefore outside of the operation of the Privacy Act and APPs. While encrypted data may obscure original information, it can easily be de-identified with a decryption key, so it is best to assume that the Privacy Act will still apply.11 Unlike the GDPR, the Privacy Act and APPs do not provide for an equivalent ‘right to be forgotten’; however, there are similar obligations related to taking reasonable efforts to ensure that personal information is accurate and up to date.12 Arguably, what is ‘reasonable’ may take into account the impossibility of deleting entries in the blockchain, a leniency which the GDPR fails to take into account. Another aspect that should be considered is how personal information is collected and stored, particularly given the distributed and cross-jurisdictional nature of the blockchain.13 Organisations subject to the Privacy Act, APPs or any state-based privacy legislation should consider the effect of the privacy laws on their proposed blockchain solutions. Lawyers should review their privacy statements to ensure they accurately reflect how personal information is stored and handled. Some commentators have compared the creation of the blockchain

Blockchains and liability Replacing contracts with code, and centralised storage with distributed ledgers, will create some commercial and practical efficiencies; however, this may be at the cost of unquantifiable risk. Before lawyers hand over the keys to computer programmers, they should take a moment to reflect on the times when things did not go to plan. The Decentralised Autonomous Organisation (DAO) is a decentralised venture capital fund that uses blockchain to democratically fund blockchain projects. In May 2017, a hacker was able to take advantage of a critical programming error to re-direct approximately US$70m to the hacker’s account in a matter of hours.14 An organisation called Parity also came under scrutiny when one of their software developers accidentally deleted part of its source code. Parity operates as a wallet for clients wishing to access their cryptocurrencies. The

portion of the code that was deleted irreversibly froze the funds of around 500 wallets, a total of US$160m in funds.15 These two examples represent a few high-profile instances of what can go wrong; however, these are just a small sample of instances where nefarious actors and poor-quality control led to disastrous outcomes. While the potential for blockchain is endless, it is important to recognise the risks it poses, especially where large sums of money or critical information is at stake. Lawyers will play a vital role, working with software and information technology teams, to help identify and manage risk to avoid catastrophic outcomes such as those illustrated by DAO and Parity incidents.

Conclusion Some commentators have compared the creation of the blockchain with the creation of email or the TCP/IP protocol, which allows us to use the internet. Regardless of whether this is an exaggeration, there is no denying that around the world, we are seeing both public and private sectors testing the capabilities of blockchain and purposely disrupting long-standing ways of working. It is important for the legal industry to be part of the journey and ensure their clients operate within the boundaries of relevant regulatory framework. a

Footnotes 1. Nick Szabo, Smart Contracts: Building Blocks for Digital Markets, White Paper, 1996. 2. Oliver Smith, ‘Blockchain Startup VChain is Flying High After its Royal Seal of Approval’, Forbes, 21 May 2018. 3. Jessica Lin, ‘A Startup is Using Blockchain Technology to Tackle Counterfeit Milk Powder – Here’s How’, Business Insider Singapore, 24 November 2017. 4. Edina Oliver and Alexander Ross Davis, ‘Ledgers are Forever: How Blockchain Could Solve Several of Real Estate’s Perennial Problems’, Thomson Reuters Legal Insight, 4 July 2018. 5. James Eyers, ‘ASX Blockchain to go Live at End of 2020’, Australian Financial Review, 27 April 2018. 6. PwC Health Research Institute, A Prescription for Blockchain and Healthcare: Reinvent or be Reinvented, 2018. 7. Nick Szabo, Smart Contracts: Building Blocks for Digital Markets, White Paper, 1996. 8. section 4, Electronic Transactions Act 1999 (Cth). 9. www.aggrello.io, www.contractvault.io, www.etherparty.com. 10. Allens Linklater, Blockchain Reaction: Nine Months On, April 2017. 11. Office of the Australian Information Commissioner, De-identification and the Privacy Act, March 2018. 12. APP 13. 13. APPs 6 and 8. 14. Emma Avon, ‘The DAO Hack – What Happened and What Followed?’, coincodex, October 2017. 15. Iain Thomson, ‘Parity’s $280m Ethereum Wallet Freeze Was No Accident: It was a Hack, Claims Angry Upstart’, 10 November 2017, https://www.theregister.co.uk/

Matthew Southwell A Senior Legal Advisor at the Department of Premier and Cabinet (Victoria), Matthew combines a keen interest in emerging technologies such as blockchain, with his primary practice areas of information technology, telecommunications and privacy law. In addition to his Law Degree, Matthew previously completed a Biomedical Science degree. The views in this article are his own personal thoughts and opinions, and not the opinion of the Victorian Government.

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SIX STEPS TO OVERCOME RESISTANCE TO TECHNOLOGY CHANGE The legal industry is undergoing a period of significant change. However, when a successful transition to digital isn’t assured, many legal professionals are reticent to explore and adopt new technology. In this article, we outline the six steps that can help legal leaders effectively manage change.

e’ve all heard the news. The legal sector is undergoing a period of significant change, and success—even for those who don’t resist— is far from assured. However, as difficult as managing change in a risk-averse environment can be, the ability of the modern lawyer to adapt and thrive in such a world cannot be overrated. Thankfully, with the right strategies in place, change can be managed proactively and with relatively little fuss. Here are six simple ways to ensure your transition to digital is a smooth one.

1. Don’t wait for the ‘right time’ When it comes to adopting new technology and exploring change, there’s no such thing as ‘the right time’. Budgets will often be under pressure and headcounts low; unpredictable economic environments make it impossible to know what’s coming next. To combat this uncertainty, legal leaders must adopt an attitude of agility and adaptability. One of the easiest ways to do this is to create a framework that supports change while retaining the ability to react to changing circumstances and evolving workplaces and priorities. The key, says CSR Limited’s Head of Legal, Sean Ventris, is to build alignment, both within the legal team, as well as in the broader business. “Individuals are more likely to ‘jump on board’and become committed when they understand the ‘what and the why’of what we’re trying to achieve. They want to feel that the hard effort will be worthwhile in the long term and will lead to a better outcome than the status quo. As part of this process, we make a point of acknowledging and celebrating key achievements along the way.” For the more risk averse, it’s worth noting that you don’t have to be the first to try or institute new technology. However, you need to remember that when it comes to change, success is never assured. To find the sweet spot between early adoption and missing the technology train, leaders must be prepared to explore, experiment and iterate. Filling gaps and implementing short-term solutions that don’t deliver a significant business improvement is not the way to go—regardless of how safe it may make you feel. Instead, focus on encouraging a willingness to explore change as it’s needed, but within the confines of what’s achievable and safe for your team, organisation and industry.

2. Get the right buy-in Regardless of the type of change you’re exploring; the transition is always smoother when everyone is on board. To enhance your opportunities for success, it’s imperative all appropriate stakeholders play an active part in the process. Building a strong and persuasive business case is a clear first step and will ensure organisation and team objectives are clear from the outset. According to Mr Ventris, maintaining a mindset for continuous improvement is a must-have, along with not being afraid to be an early adopter. These things, he says, will deliver, “a step-change in efficiency and enable the team to demonstrate value and be accountable for legal spend. However,”he adds, “this is only part of the story.”

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His advice is to begin by ascertaining everyone who will play a key part in identifying, testing and rolling out the chosen solution. Depending on the makeup of your team and organisation, this may include IT, procurement and legal (including lawyers, legal operations, external service providers). Mr Ventris adds, “Critical to change is obtaining the support of the key functional members of the team—the CFO’s role in this is crucial. Additionally, as so many of the innovation improvements have a technological aspect, the IT team have a key role to play in the business case.” Once your stakeholders are set, clearly define the project team who will be responsible for spearheading and running the project. You may choose to have representatives from each stakeholder group or, if the project is to be confined to a discrete organisational unit or department, key personnel from the appropriate team. This will ensure a balanced approach to change that identifies and considers wins and losses from all perspectives.

3. Define your goals To convince the stakeholders and potential users who may not see the benefits or are wary of investing in new technology, defined goals are a must-have. These may be financial-or efficiency-based but must be quantifiable and measurable. Although technology solves a range of issues, potential benefits shouldn’t be measured solely in financial or efficiency terms. Instead, focus on identifying and defining a range of quantifiable and measurable goals that support an agile approach. Having these defined objectives will help inform your conversations with potential vendors, ensuring a focus on what you want to achieve and the best ways of doing so. It’s a buyer’s market, so take control and make it clear to potential providers what you want, how you work and how you want to implement or roll out your chosen solution.

4. Build a strong business case When it comes to implementing change, budgets are a necessary reality. However, when you’re dealing with a reduced budget and/or a resistant or change-averse environment, building a strong business case and proving ROI on a potential technology investment are non-negotiable. According to Steven Walker, CEO and Founder of Gen2Law and former General Counsel at Hewlett Packard Enterprise, “the ability to prepare a solid business case is a new and essential skill for many legal professionals.” However, he’s quick to highlight the point that legal professionals tend to have less experience with business cases than their clients in business roles and may strive for data perfection and exhaustive detail. This can lead to analysis paralysis and never-ending review loops that can last months, or even years. The trick, he says, is to calibrate the depth and level of detail according to the organisation and the strategic significance of the project itself. “A good business case should, at a minimum (and including the most comprehensive metrics reasonably available), cover an assessment of status quo and competing improvement options and include the inaction cost—i.e. choosing to take no action at all—relative benefits and risks, required resources, execution timeline and key milestones, budget, key stakeholders and selection criteria. When it comes to ROI, always articulate the quantifiable savings in terms of efficiency and cost, weighed against the costs of implementation and ongoing run.”

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“There are many different formulae available,”he adds, “but good IT projects should aim for an ROI of more than 60% overall with a realistic and achievable payback period. ‘The business case should also articulate unquantifiable benefits, including increased employee engagement, improved client or customer experience, increased quality or timeliness, or enhanced ease of doing business.” Above all, according to Mr Walker, “the client should be placed at the centre, with benefits to the client organisation well considered and articulated. This will help potential suppliers deliver on your needs while demonstrating to senior executives how technology investment can help deliver better, faster and cheaper business outcomes.”

5. Communicate and collaborate The legal team aren’t the only ones who’ll benefit from the introduction of new technology. The right digital solution will influence and deliver efficiencies and savings that can be realised across multiple business units and the organisation as a whole. However, as Mr Ventris confirms, “transitioning a company’s people, systems and methodologies can be difficult. The capacity for a busy legal department, such as CSR which is primarily focused on day-to-day priorities, to execute ambitious and sustainable change, is a key element to long-term success, but it also represents a great challenge. Driving successful change within the corporate legal environment—whether a simple protocol adjustment or a major organisational overhaul requires effective management.” Such effective management includes, he adds, “managing numerous stakeholders, including IT, risk and audit and procurement. These stakeholders bring with them a range of sometimes differing agendas and expectations. To be successful, a change process should commence with a comprehensive assessment of risks and the development of a coherent plan of action, involving all of the key stakeholders at the earliest possible stage of the process.”

management, paying attention to strategies targeting not just initial resistance to new ways of working, but to promoting long-term user adoption’. ‘Not everyone will jump on the bus at the same time or in the same way’, he says, ‘so culture and communication are key. The new vision, processes and expectations must be well-defined and communicated, underlined and communicated again. Ideally, balanced with a healthy dose of fun and excitement about the future’.

6. Explore, experiment and iterate As the legal department moves further away from cost centre status, contributing to organisation-wide value outcomes is quickly becoming an imperative. And for legal leaders wanting to stay ahead of the curve, exploring technology is a vital element of this shift. To ensure that change benefits the entire organisation, it should be viewed through an iterative lens, rather than one of perfection. As Walker articulates, “A perfectly executed IT implementation is a mythical creature and the perfection approach is neither pragmatic nor possible.” By recognising that modern business relies on agility, flexibility and practical application to move forwards, legal teams will be able to approach this brave new world with excitement rather than trepidation. a

Shauna Maguire

Above all, Mr Ventris offers this advice. “Keep in mind that realising tangible results in the change space is not easy; it requires determination, focus and planning.”As Mr Walker adds, “the reality is that the legal profession has been reticent to adopt new technologies and service delivery methods, partly because of a desire to maintain the ‘practice’of law as a profession, rather than treating legal services as just another professional service to be ‘delivered’as a business.”

A former lawyer turned communications professional, Shauna is the Business Development Manager for the fast-growing Australian legal tech company, Lawcadia. There she applies her keen interest in streamlining legal communications and exploring the ever-growing areas of legal technology and legal marketing.

However, the winds of change are upon us, so when considering change in legal service organisations, he says, ‘Those designing programs would do well to learn from established change management models and methodologies which have been applied successfully in business contexts for many years’.

With contributions from Sean Ventris, Head of Legal, CSR Limited and Steven Walker, CEO and Founder of Gen2Law.

‘As a rule of thumb, I generally recommend a starting allocation of around 50% of the budget to the technology sourcing, and the balance to professional change

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TIGHTER HIRING LEAVES LEGAL DEPARTMENTS SEEKING REVOLUTIONARY SOLUTIONS Legal departments need help, but hopes for additional personnel are largely pipe dreams. That leaves technology as the key—but organisations shouldn’t rush in blindly.

ooking back on the industrial revolution, legend has it that the automobile magnate Henry Ford once opined, ‘If I had asked people what they wanted, they would have said faster horses.’

In this century’s legal technology revolution, what do Legal Departments want—and what do they need?

That task is more demanding than one might realise. Nearly 70% of legal operations professionals say their current technology doesn’t meet their department’s needs. It stands to reason, then, that they identified ‘legal technology management’ as their number 1 priority for the next twelve months, outranking cost control, cybersecurity and even litigation management.

The demand for ‘faster lawyers’ is obvious: in a recent ACC Global Census, nearly half—49 per cent—of in-house lawyers reported an increase in workload over the past year; 42 per cent said the demand remained the same.

Meanwhile, more than half—54%—of legal operations professionals said they planned to spend more on technology in 2018 than in the year prior.

One primary driver is the ever-evolving regulatory landscape, which was ranked by seventy per cent of chief legal officers as a major stressor. (No wonder: 31 per cent said they have been targeted by a regulator for a violation in the past two years.) The adoption of the General Data Protection Regulation (GDPR) alone had forty-seven per cent of in-house counsel scurrying to change their company’s data security standards, according to an ACC survey.

Why have a technology roadmap?

So today’s legal departments face a messy and mutating maze of regulations, unrelenting regulators and a bigger workload. As the work expands, three options emerge: hire more lawyers, spend more on external lawyers or find new ways of doing things. In Henry Ford’s parlance, it’s time to either get faster horses or invent the law’s equivalent of a Model T. Hoping for a higher headcount is not a reliable solution. According to Altman Weil’s 2017 Chief Legal Officer Survey, in the 2018 calendar year: •• 51.6% planned to maintain their headcount of in-house lawyers •• 76% planned to maintain their headcount of contract lawyers •• 67.4% planned to maintain their headcount of paralegals •• 76.5% planned to maintain their headcount of support staff •• nearly 10% planned to decrease their in-house lawyers. So, maybe outside help is on the way? Maybe not: in the same Chief Legal Officer Survey, 28% planned to maintain their outside counsel spend, while 32.5% planned a decrease. If expansion is out and there’s no money for additional outside spend, one option remains: explore some new solutions. Enter in-house legal technology.

Sifting through blueprints to find a Model T The legal tech universe is overwhelming: the CodeX Techindex tracks 855 companies serving the legal industry, from AI Patents, which automates patent analysis, to Zipcourt, an online courtroom. It’s hard to know where to start—and harder still to find technology initiatives that fit a legal department's budget, data security requirements and, most critically, culture. The first step: plot a legal technology roadmap for the department. How can technology improve efficiency and productivity while also advancing strategy? An organisation must know what it needs—and doesn’t need—and have a thorough understanding of its workload and capabilities. A good roadmap also must consider the future, so various technologies added over time can work together and grow with the organisation. 40

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Several flags serve as clues that a legal department is hurting from a lack of a technology roadmap. Maybe team members come back from conferences asking for the latest fill-in-the-blank app, the department has no tech budget (or even a relationship with IT, for that matter), each team member has a different way of organising and finishing tasks, or the department software is unreliable, unsupported or won’t sync together. Addressing these issues with a technology roadmap isn’t just an academic exercise. Stephanie Corey, co-founder of UpLevel Ops and the Corporate Legal Operations Consortium, cites five real benefits of a technology roadmap: •• It lays out a method to the madness—these aren’t going to be impulse buys. •• It helps determine which projects are simply ‘low-hanging fruit’, making it easier to triage and dedicate resources to more complicated projects. •• Without a plan, it’s easy to end up with the wrong technology— or a mishmash of technologies that don’t cooperate well. •• A good tech plan also informs strategies relating to budget, staffing and more. •• A legal technology roadmap offers a straightforward visual to the rest of the department and to those asking for other resources.

What exactly is in a technology roadmap? A technology roadmap, as defined by chief information officers, is ‘the governing document that dictates specifically how technology will support the business strategy and help drive business priorities over the next three to five years.’ They may vary in complexity and scope, but according to CIO magazine, roadmaps should contain: •• a strategy statement with a list of strategic priorities for the business (not technology-specific priorities) •• a prioritised list of improvement opportunities •• high-level justifications for each project •• estimated cost and duration of each project •• an ‘owner’ of each project •• a timeline of the initiatives and projects that will occur over the next several years

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How does one plot a legal technology roadmap? The following steps can help identify low hanging fruit and high impact technologies that will optimise your Legal Department. 1. Gather intel and context Every successful mission starts with a reconnaissance. Before charting technology hopes and dreams, stop and collect some macro- and micro-level information. Questions for the Legal Department Consider these questions to discuss within a Legal Department: •• What are your Legal Department goals? •• Outline your Legal Department structure? - Team size - Type and volume of work - Most demanding clients and relative importance - What is the current state of technology in the department — what technology is available, and what are the usage rates? Questions for the organisation Consider who will need to see, approve or understand the roadmap: •• Corporate goals: List the strategic priorities for the business. (Not for the Legal Department, but for the business. Overall corporate strategy should be the guide.) •• Finance: How does a budget perspective affect the approach to technology plans? Are there any relevant deadlines or constraints? •• Technology: Who will be the contacts for Legal Department projects? What rules exist for cybersecurity, cloud computing, etc.? What kind of enterprise-wide tools are available that might be unknown to the Legal Department? •• Business clients: What are potential areas of improvement? How could technology improve service? What level of technology sophistication makes them comfortable? •• C-Suite: What strategic initiatives are on the horizon for the next three to five years? Engage with IT colleagues early and often. They can provide battle-tested advice about product rollouts, and they will be instrumental to a roadmap becoming a reality. Don’t surprise them with a ‘final’document that requires their staff, funding, servers, security assessment and more. 2. Identify needs Make a list of the department’s opportunities for improvement. This will be far easier if informed by solid data about the department’s legal matters, such as their complexity, strategy and size. A LegalTech roadmap can be built by starting with major pain points, but you may also like to consider building your roadmap in terms of technology types, as this will correlate with conversations you may have had with peers, or technology solutions you have seen elsewhere. 3. Prioritise Once improvement opportunities are listed out, prioritise. There’s no single solution for ranking tech activities, but it’s wise to determine a rationale for what to pursue first. Would it be best to fight the biggest fire first or to start with some easy wins? Should you consider pain based on risk or on productivity killers? It is also worth including some high level information gathering here: •• Match your technology wish list to pain points. •• What tools are already available at the enterprise level? •• Do you have high level information about cost and implementation? 4. Plan Now, build on the details of the legal technology roadmap. With the priorities in mind, draft a timeline of projects to pursue over the next several years. (Be realistic; technology rollouts often take longer than one might think. Consult a colleague in IT for help with estimating timelines). Also, make it visual! For each project: •• articulate the high-level justifications. CIO advises that these should be ‘robust for projects over the next 12 months and [simpler] for projects past the 12-month horizon’

•• ••

prepare the estimated cost and duration. These should be detailed and practical for short-term projects; for long-term projects, they can be estimates designate an owner. Who in the department will be responsible for researching vendors, liaising with other departments, and training the team? A project’s success can hinge on having a credible sponsor who will be its champion.

Wrapping it up After the plan is complete, troubleshoot it. Consider the traditional ‘three Rs’ of implementation: make sure the plan is relevant and realistic, then refine the final list of projects. Troubleshooting should provide answers to the following: •• how the legal technology roadmap helps business clients •• how the plan makes the department more efficient •• how the plan improves service delivery •• how the plan advances company strategy. At this point, revisit the stakeholders. Discuss the nuts and bolts of implementation with IT. Discuss how to fund the projects with finance. Prepare the department for new processes and tools—and possibly some growing pains. Implement the plan, knowing that it may need revision as corporate visions and business realities change. Still, take comfort in having created a comprehensive, strategic guide that arms the department with tools to best serve the organisation. To go above and beyond—if several tech tools are already in place, various tools can be linked to avoid duplicating efforts or re-keying information. For example, a workflow tool may take a document assembled by the business using an automation tool, have it finalised by the legal team, sent to finance for approval and ultimately delivered to an outside party for a digital signature. Whatever the needs of the specific business, mapping out legal technology requirements is an excellent place to start. With increasing demands on legal staff, taking this proactive step may just spark a Model T–type revolution. a

For a technology roadmap template you can customise for your Legal Department, visit www.xakiatech.com.

Jodie Baker As the Managing Director of Xakia Technologies, Jodie combines her legal and financial services background to focus on building tools to manage the business of law. Jodie is also Deputy Chair of the Australian Legal Technology Association, dedicated to providing a community to Australian legal technology companies and building the presence of Australian legal technology on the global stage. Jodie was a speaker at the recent 2018 ACC Australia National Conference and delivered a presentation entitled: Boost Your LegalTech ROI: How to Build a Legal Technology Roadmap for Your Department. VOLUME 28, ISSUE 4 – SUMMER 2018 |

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ACC G LO B A L U P D AT E ACC Annual Meeting 2018 a Success ACC’s 2018 Annual Meeting (#ACCAM2018) was held in Austin, Texas from October 21 to 24. Over 3,600 in-house counsel, representing global brands, including Microsoft, Booz Allen Hamilton, Disney, Exxon Mobil, Capital One, along with exhibitors and speakers were in attendance, and thankfully stayed, despite a temporary drinking water crisis in Austin. The meeting featured a host of panel discussions, roundtables, workshops and covered a range of topics extending across budgeting for small legal departments, Artificial Intelligence and the future of in-house counsel, negotiating tactics, workplace diversity, and limiting liability in global operations. The 2019 Annual Meeting will be held in Phoenix, Arizona from October 27-30, 2019.

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ACC Elects Simon A. Fish as Board Chair, Adrian Gross to Board Last month, ACC named the 2019 officers of the global Board of Directors. Chairing the Board will be Simon A. Fish, Executive Vice President and General Counsel at the BMO Financial Group in Canada. Mr. Fish is responsible for BMO's legal, regulatory and compliance affairs. This includes corporate governance, mergers and acquisitions, capital markets and banking regulation, and complex litigation. He is also responsible for the bank's ethics, ombudsman, sustainability, and investigations functions. He serves as adviser to the chair of the board of directors and is a member of the bank's executive committee. He chairs the bank's reputation risk committee, and the environmental, social and corporate governance committee. He also serves as BMO's

executive diversity champion and serves on the boards of a number of non-profit and charitable organisations. Other directors include Vice Chair Anneliese Reinhold, General Counsel and Senior Vice President of regulatory affairs at du, in the United Arab Emirates; and, among others, the antipodean Adrian Gross, General Counsel at Bauer Media. Mr. Gross is a past director of ACC Australia. “We are pleased to welcome our most globally diverse class of leaders to date,” said Veta T. Richardson, ACC President and CEO. “The breadth and depth of perspectives offered by the 2019 board of directors will greatly enhance ACC's ability to serve inhouse counsel around the world.” a

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