Chief - Legal & Principal Compliance Officer,
ICICI Lombard GIC Ltd
Be it the globalization efforts of the government or driving development, India has witnessed substantial change in the laws and procedures in the last two and half decades, mostly emerging out of control versus convenience paradox in governance. Growing awareness of the general mass coupled with increasing compliance intricacies has pushed “Legal Risk” high up in the risk priorities in the commercial, professional and personal spaces.
"Legal consultants are not only technical experts, who provide services for interpretation and application of law but also philosophical guides, who help in deriving better logic and arguments to the interpretations"
Characteristically, legal risk is intangible at assessment but becomes severe upon manifestation, as at the manifestation stage, it does not remain to be only a legal risk but also becomes a financial risk, operational risk and over and above everything it becomes a reputational risk. The time lag between assessment and manifestation of a legal risk is undeterminable as the events of probability and subjectivity which contribute to the culmination of legal risk are usually high and unpredictable. Under such circumstances, the wizardry required to assess the risk and to build adequate containment measures must be sharp, relevant and replete with experience.
Contemporarily, impatience is considered as a necessary evil for the industry striving for growth and competition, which has naturally but unnoticeably crept into the society, influencing human behavior to a large extent. The most prevalent ‘here and now’ approach in all spaces, more specifically in addressing legal risks demands consultants with extensive experience and expertise to provide solutions which are not only quick and effective but also sustainable.
Relevance: Gone are the days, when a lawyer’s chamber used to be the ‘one stop shop’ for all legal concerns. The above improbability in the supply side and impatience in the demand side has led to the emergence of specialized services in the field of legal practice. This also manifests from the fact that the adjudicative mechanism of the country is gradually shifting from generalized courts to specialized tribunals. Apart from developing specialization in any given faculty of law, the consultants are expected to develop expertise in appreciating the ever growing complexities of business and its structures to be able to provide most customized services.
While it is true that specialization begets relevance in any professional service, legal risk does not necessarily remain confined to the subject matter of one’s specialization. The complex structure and applicability of laws in the country is inter connected. Hence, one cause could drive many consequences under different faculties of law. Therefore, one has to have an overall understanding of the structure and application of laws, even though he has deeper understanding of the law he specializes in.
Sharpness: Ability to provide specialized services might make a legal consultant relevant, but such attribute alone may not be able to cater to the demands of an entity in addressing its legal risk. When it comes to legal risk, the consequential anxiety is natural and obvious. In such situations, one expects its legal consultant to be adaptive, responsive and witty. Admittedly, legal risks are not absolutely mitigable, more specifically before the risk lives its term. However, legal risks are very much containable, if one is able to identify his priorities distinctly. One expects his legal consultant to be intrigued by andacknowledged of the environment to gauge control over the given scenario and vigilant enough to provide assistance in containment of the risks strategically.
Experience: Experience is one’s ability to apply learnings from previous events to a new situation to be able to make the most prudent decision under the available information and knowledge. The more one works on any given field of knowledge and practice, the better learning he receives and thereby whets his skills to make the most reasonable assessment of any risk and opportunity arising out of a situation. Given the fact that culmination of legal risks are highly subjective and unpredictable, experience is considered as one of the most valuable attribute in any legal consultant being looked at for assistance.
Legal consultants are not only technical experts, who provide services for interpretation and application of law but also philosophical guides, who help in deriving better logic and arguments to the interpretations. In view of the complexities involved, if the practices could be called a wizardry, the attributes such as relevance, sharpness and experience are the staffs of the wizardry that bestows power upon a legal consultant to foresee the future risks and create appropriate defense to protect the interests of his clients.