Q&A with Malcolm Shelton-Agar– "Asian law firms are very sophisticated and it's their home town"

In the first part of a two-part Q&A, Jackson McDonald chief executive officer Malcolm Shelton-Agar discusses his leadership philosophies, people management and the challenges of targeting legal work in Asia.

Courtesy of decades of experience at DLA Phillips Fox (now DLA Piper) in Australia and New Zealand, Allen & Gledhill in Singapore and now Jackson McDonald in Perth, you have gained a wealth of management knowledge. What lessons resonate as a leader?

My career has evolved and the longer you do it the more you reflect about what works. With leadership philosophy, I think you have to be as self-aware as you can be about your own strengths and weaknesses. And in terms of your people, you want them to be as self-aware as they can be around their relationships with their staff and clients because you really can’t do anything around change and evolution if you are not self-aware.

And what about the management of the firm itself?
In the modern practice of law you have got to be externally focused. You’ve got to understand your market and your clients. Within that, you have to be prepared to change and evolve. If you are not prepared to think about improvement – whether it is improved strategy or better processes – you will very rapidly be overtaken. In Australasia and Asia it is extraordinarily competitive – it has almost changed out of sight from 1981 when I first started in law. And if you are not open to self-reflection about how you practise and how your business is run, you will be overtaken.

What else is important as a leader?
The other big thing is that you’ve got to truly understand the firm’s culture and be true to it. The key here is not saying what the culture must be, but understanding what the culture is and being true to that. There are lots of different cultures that you can have in a professional services firm – all of which can be different and all of which can be successful. The problem is when the culture is ‘A’ or espouses to be ‘A’, but everybody in fact does ‘B’. That’s a huge impediment.
Also, in the modern law firm the partnership has to let people do their jobs; they’ve got to let them bring the value that they have, whether it’s in HR or business development or IT. They’ve got to let them add value to the business.

So you can’t be too controlling.
That’s right. It’s the sort of thing that corporates have not even thought about for 50 years – for example, the HR director runs HR policy and manages people. This is only relatively recently being understood in partnerships. The thing I say to my people is ‘you’re here to add value’ and the other side to that coin is that they have got be allowed to add value.

You bring a lot of multinational experience to your new role as CEO at Jackson McDonald. How does that experience translate to an independent law firm based in Perth?
The issues facing a law firm or professional services firm are no different in Singapore, Sydney, Wellington or Perth. That’s my experience. There are nuances and cultural differences, of course, but the issues remain the same.

After leaving DLA Phillips Fox in 2009 after almost three decades at the firm, you announced your retirement. Soon after, however, you accepted a chief operating officer position at Allen & Gledhill in Singapore. What happened to retirement?
I certainly started with retirement in mind. But after about six months I realised I was not ready to permanently retire. Then a call came to go up to Singapore. I’d already come to the view that I thought the practise of law and the business of law was evolving quickly in Asia and that it would be nice to see that close up – both from a cultural point of view and from a market-driven perspective. I went into a firm with close to 800 people, of which there were half a dozen expatriates. That was a great experience for three years.

Tell us about your Singapore tenure.
Well, it was interesting on a number of different levels. It confirmed the belief that the issues that face professional services firms are much the same – how do you grow your revenue; how do you go to market; how do you meet client needs; how do you motivate your partners and your staff; how do you make sure your costs are contained? All of those things are true of any professional services firm that I have been in and it’s certainly no different in Asia.

How about the cultural differences – are they significant?
There are some really simple things that stunned me. I remember when I first got to Singapore that a partner was talking to me and he was deeply upset that somebody in the US had sought a meeting with him in the middle of Chinese New Year. He was upset because they hadn’t even turned their mind to the fact that this was an important period of time in Chinese culture – and it was a bit like asking for a meeting on Thanksgiving. It was deeply offensive to him, and I thought ‘wow’. There are lots of cultural nuances that are much deeper than that incident, but there are differences in working for an Asian firm and working within Asia compared with working in a Western firm and working in the West.

How did you handle the situation with your upset colleague?
Well, it was an after-the event situation. But the point is that these people had caused offence without even getting in the room and they didn’t even understand that. But those issues are very real.

So what advice do you have for firms targeting legal work in Asia?
There are different ways of doing business and it comes to this broader issue of competing in Asia. First of all, Asia is an impossibly wide definition, so you really have to ask yourself whether you want to be in Southeast Asia (Singapore, Indonesia, Malaysia, Thailand and Vietnam, for example) or do you want to be in North Asia (countries such as China or Hong Hong) or do you want to be in Japan, which is different again. And I haven’t even mentioned the Philippines. They are all very different. The second thing Australian law firms looking to go into Asia have to ask is this: What is it that I want to do in Asia, and what legal advice do I want to give? Do I want to target domestic law? Or do I want to target international law because a lot of business in Asia, whether it’s financial services or M&A business, is conducted where English law or New York law is the dominant law? And that is, in fact, what the global law firms are doing – they are bringing their experts in and dealing with English law or New York law. If that’s what you are going to do, where are you going to source your English and New York lawyers from. And, by the way, are you going to go head to head with the Magic Circle law firms and the big American firms? Are you up for that? If you are not going to do that and you think you are going to do domestic law – which means you are going to advise on Singaporean law or Indonesian law, for example – then you’d better understand their regulatory environments because they are very different and they are quite complex and they are not as open as some people think they are. That is a huge kettle of fish that you have to understand. Then you have to think ‘what am I going up there for?’ Am I trying to follow a client, so therefore it’s a defensive action on my part? You have to be very clear about what you want to do if you are trying to grow revenue and attract business to your firm. The final thing I would say is don’t underestimate the Asian law firms. They are very sophisticated, they are very ambitious and they are filled with very bright people – and it’s their home town.

Your breakdown of the Asian legal market explains why a lot of foreign firms have found it difficult to break into Asia.
Correct. I mean, if you ask a West Australian lawyer who has spent his whole life practising in Perth to go and set up shop in Sydney with no real networks and no deep understanding of that market – and then add another layer of complexity and say ‘start doing that in Singapore, please’ where it is very tightly networked – it’s a tough ask. I would caution anybody who is looking to move into Asia on a greenfield basis to be very clear about their strategy.