Since it demutualised and listed on the London Stock Exchange in 2006, life insurance giant Standard Life has streamlined its business. And after combining its banking and financial services division this year, Barclays Bank has emerged as a lead contender to acquire the group’s banking arm.
The insurer’s evolution post-demutualisation does not stop there. General counsel Malcolm Wood has been gradually implementing a number of changes to the 90-strong in-house legal team.
“We’re a much more dynamic legal team,” he says. “We’ve certainly got a more focused and specialised team.”
When The Lawyer last spoke with Wood in 2007, the in-house team had just completed the mammoth legal task of demutualisation and the insurer was in the midst of transforming its legal function.
Although there are few new faces, the overall numbers have pretty much stayed the same – 75 lawyers operate in the UK while the Canadian and German offices have 10 and five respectively.
“We’ve had some personnel changes but the key difference is that we’re now much more integrated into the business,” he says. “We now deal more heavily with corporate governance issues and this requires part of our team to be working more closely with senior members of the business.”
Corporate governance was previously handled by Wood as part of his company secretary remit, but Standard Life now has a 12-lawyer corporate governance team that acts as a government lobbying function. The team also gives advice on how government reviews, such as the Walker review, will affect the business. For Wood, this team has been invaluable since it launched in 2007.
“You have to be involved in the debate if you stand a chance of having your voice heard,” says Wood. “Our lawyers can influence the reviews we have seen and guide the business on how to react and how it may need to adapt to any changes.”
The team’s lawyers work directly with senior members of the business on a daily basis.
“It’s great for training and development,” says Wood. “It’s a very interesting area of what we do and putting individuals from the team in charge of this is a fantastic way to hone someone’s skills.”
For Wood, reshaping the legal team to better suit market conditions has also been necessary. The credit crisis has sparked an increase in dispute resolution for Standard Life, prompting Wood to set up a team designed to tackle disputes.
Launched in 2008, the seven-strong team has cut legal spend as the insurer strives to keep an increasing amount of litigation work in-house.
“Cost was a driving force but certainly not the only one,” explains Wood. “We wanted to have a greater centre of expertise internally so that we would handle disputes more effectively. On the rare occasion we had to deal with disputes before, we would quite promptly turn to external counsel. We don’t need to do this as much anymore. We can handle the majority in-house.”
Wood does not instruct via a formal panel but he does highlight a select group of firms he turns to regularly. Slaughter and May and Clifford Chance are the two main advisers – Slaughters partners Glen James and Craig Cleaver worked on the group’s demutualisation three years ago. Others include Herbert Smith and Scottish firms Dundas & Wilson and Burness.
The credit crunch means Wood is approached regularly by firms offering competitive rates, but he insists his legal team will remain loyal to its relationship advisers.
“I think loyalty is a two-way street,” says Wood. “We ask firms to do so much for us and negotiate on fees. I think it’s our responsibility to respect the service they provide and commit to the relationship we have.”
Trusted advisers may have remained unchanged but revamping the legal team has been a challenge – one that Wood has relished.
“It’s been exciting for us” says Wood. “There’s no doubt about it. We’re now more skilled at what we do.”
Name: Malcolm Wood
Position: Company secretary and general counsel
Organisation: Standard Life
Sector: Financial services
Reporting to: Chief executive David Nish and the board
Number of employees: 10,000
Legal capability: 90
Main law firms: Burness, Clifford Chance, Dundas & Wilson, Slaughter and May
Malcolm Wood’s CV
1973-77: University of Edinburgh
1977-78: University of California at Berkeley
1978-80: Trainee, Brodies
1980-81: Associate, Brodies
1981-82: Associate, Herbert Smith
1982-83: Associate, Brodies
1983-85: Associate, Burness
1985-2001: Partner, Burness
2001-04: Director of legal, Standard Life
2004-present: Group company secretary and general counsel, Standard Life