Good, clean fund: Rob Graham, Franklin Templeton Investments
7 March 2011
Franklin Templeton Investments head of legal Rob Graham and his team have been key to the fund manager winning business. By Gavriel Hollander
When Rob Graham left Travers Smith to pursue a career in-house with US fund management group Franklin Templeton Investments, he was not expecting a life spent flying back and forth from Bucharest once a month.
As Emea head of legal for the institutional side of the business, the former financial services associate was soon pitched into one of the more unusual deals of his legal life.
The tale began when Franklin Templeton won the contract to manage a Romanian fund set up to compensate victims of one of the Eastern bloc’s most brutal communist regimes - not the kind of thing they teach you about on the LPC.
“The attention we’re getting out there is remarkable,” says Graham of a piece of work he dubs “fund management for the force of good”. His tongue may be slightly in his cheek with such a description, but the importance of the fund to the country should not be underestimated.
“It does come with its own set of headaches,” Graham admits. “As an ex-communist country it’s highly regulated and every aspect of the business has had to decide on its own interpretations of the regulations.
“But one of the breakthroughs has been seeing regulators get more flexible as they get used to working with us.”
As evidence of the importance of staying close to the local regulators, he cites the fact that the fund, known as ’Fondul Propietatea’, is the only one in Romania to have been granted an exemption to follow international regulation on fair value.
The presence of a large, visible legal team was central to Franklin Templeton winning a tender that went out to 27 fund managers.
“They said we were the only ones who brought our own lawyers,” he explains with obvious pride. “As lawyers we tend to get the old jibes from sales about being business prevention officers, but this time they had to swallow their words.”
Although Franklin Templeton has used external counsel on the Romanian fund over the past two years, instructing Salans and White & Case as well as several local firms to advise on litigation disputes, Graham insists that the strong in-house presence was absolutely crucial in helping a fund that needed more guidance than most.
“Ultimately it was about the level of time commitment,” he continues.
“I was sitting in a lot of business meetings - we couldn’t afford to have external counsel sitting there to hold everyone’s hands like we did.”
The ability to stay close to the action throughout has paid off. After waiting a year - and surviving two changes of government - to take over the fund, it managed to pull off a Bucharest listing within three months, with shares trading for the first time this January.
Graham says the success of the Romanian adventure, for all its unusual pitfalls, has sparked interest in Franklin Templeton in other Eastern European emerging economies, notably Bulgaria and Kazakhstan.
“It was a big win for us and something we’re looking to replicate,” reveals Graham.
Franklin Templeton has one of the larger in-house capabilities of the big global fund managers, with a team of around 50 lawyers operating around the world.
Stressing that the role of in-house counsel is vital in fund management companies, Graham says Franklin Templeton’s legal team is expected to grow in the future.
“They’re committed to opening new offices,” he says. “And when they do that, they’ll need local lawyers.
“They didn’t cut back much during the recession, the morale’s stayed good, and now we’re growing again.”
Graham admits that the fabled work-life balance was one of the reasons he opted for a role in-house rather than continue the slog towards partnership in the world of private practice. But the excitement around deals such as the Romanian fund means there has been little easing of the workload.
However, apart from not getting to see his beloved Stoke City FC play as much as he would like, there are few complaints.
“My personal experience is that the remuneration is getting much better in-house and so the level of expectation’s gone with it,” he says.
And if that expectation means monthly commutes to Romania and beyond over the coming years, Graham seems perfectly happy to do the leg work.
Name: Rob Graham
Organisation:Franklin Templeton Investments
Position: Emea institutional head of Legal
Industry: Fund management
Reporting to: Emea chief general counsel Charlie Fuller
Turnover: $5.8bn (£3.56bn)
Employees: 8,000 groupwide
Legal capability:Approximately 90 in global department (around 60 lawyers); 29 (17 lawyers) for Emea
Legal spend:£300,000-£500,00 for Emea, excluding one-off projects
Main external firms:Simmons & Simmons for UK Retail Fund platform; Elvinger Hoss & Prussen for Lux Retail Fund platform; for ad hoc advice it depends on jurisdiction and subject matter