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Citi, with one of the largest in-house legal teams in the world, has further deepened its presence in India (and abroad) with the formation of a legal hub in Mumbai, which will not only cater to the domestic Indian market but will serve its businesses spread across the APAC region. As a multi-faceted institution, this will supplement Citi’s global operations with support from their Indian franchise.
Leading this project is Nitin Batra, who heads Global Legal Solutions for Citi, with ground-level logistics support being provided by Pramod Rao, General Counsel of Citi India.
However, this is not the first time that Citi has established such a legal hub. The first two were set up in Tampa in 2015 and in Belfast in 2007. Given the workload handled by these two hubs and the desire to expand coverage across all time zones, India was the perfect third leg of the stool.
What this move demonstrates is the breadth and depth of legal talent in India that can be deployed across different areas of work in which Citi is engaged.
In this interview with Bar & Bench’s Varun Marwah, Pramod and Nitin explain to us the strategic motives of trusting India as a destination for this legal hub and the thrust on performing work within the group as opposed to outsourcing it.
Varun Marwah: Could you briefly explain the motive behind establishing this legal hub?
Pramod Rao: The leadership of Citi’s legal function has always envisioned a model that can provide centralized Legal support across multiple products and geographies.
The distinct aspect of this project is that it will be multi-specialty in nature from Day 1. We will not be looking to provide legal advice and support for a single area but for 6-7 areas. These include support for our Markets and Securities Services (i.e., Fixed Income Currency Commodities – FICC) business, Investment Banking and Capital Markets Origination businesses as well as technology and procurement contracts. Equally, we will also look to provide support for product areas more exclusive to banks, such as Trade Finance, cross-border Loans that we would (in India) call ECBs, that are actually offshore lending transactions, and Private Banking, which deals with providing solutions for Ultra High Net Worth individuals. These are the broad areas of law that we will support from this new Legal hub.
Furthermore, we will also provide support for the underlying operations and technology of the legal function from this hub.
VM: How is this different from the already existing legal team in India?
PR: The difference is that it will be regionally focused from Day 1. So for instance, it won’t focus on the work within the country, and rather it would span across APAC countries. To begin with, it would obviously focus on the English speaking world within APAC, and as we grow in scale and size it will encompass all of APAC really, and global as well.
Nitin Batra: The traditional hubs for Citi have been New York, London, Hong Kong and Singapore. Given where the industry and market is, and the increasing complexities in the legal and regulatory landscape, the work continues to increase. For Citi, as a strategy, what we have decided to do is extend our hub footprint to provide this support. Tampa, Belfast, Dublin and Mumbai are at the forefront of that strategy. So all new roles that either support a regional or global client base will be looked at to be performed from our new hubs.
Finally, a key differentiator of Citi is our truly global reach and coverage across a hundred countries. By extension, I believe that this hub will allow us to provide a very exciting opportunity for individuals both from a cross geographic exposure and career mobility standpoint to expand into roles and locations across our global footprint.
VM: What will be the nature of relationship between the Mumbai Hub and other centers?
PR: It will be augmenting our other centers. Basically, Singapore and Hong Kong, will rely on and work alongside the Mumbai hub, to support each of the domains mentioned. The challenge, at some level that we have seen, is this predilection, which we want to disabuse, of thinking that it’s an LPO. LPOs are by nature purely focused on cost arbitrage, high volume and repetitive work. Our focus is on the 5-6 major businesses we support globally, what is it that we can do with the Indian talent in being deployed in these domains, and add value is really what we are aiming to.
So this goes on to build something that is cross-geographic, which is going to be supporting Hong Kong and Singapore; growing far more here given that it’s a strategic investment to capitalize on the talent which is available here.
NB: If you think about traditional LPOs, they are doing things like e-discovery/document review, litigation support, contract abstraction, legal operations and invoice processing. This will not be a back office legal center by any stretch of imagination. Starting from Day 1, we are looking to provide true client and business facing, end-to-end legal advice and support across our various businesses including a number of leadership roles and opportunities.
VM: Tell us more about the strength of your team currently, and the foreseeable expansion goals.
PR: We’re already 15, and we have another 5-10 committed hires, so by the end of the first quarter in the low 20s and plan is to at least double it by this time next year. Right now the investment has been around people with PQE’s in the range of anywhere between 4 years to 10+ years, but yes sooner or later, when we have that mass, we will also go to campuses. The first wave has been to sort of establish a base of experienced people; as we’re going through a second wave and as we move forward we will be recruiting younger talent as well.
Our team has a cross-section from different areas; I think we want to say that it is multifaceted or multi-specialty, so we have drawn from different pools of legal professionals; from law firms, from people who have worked in other service companies and of course those who have worked in financial services and banks.
NB: We are also very interested in individuals with a returner background. Those that have learned and had experience working with international jurisdictions, clients etc. We believe they exist in this market and we really want to attract them to Citi to support this cross-geographic cross-product legal department that we’re trying to build here. That’s a segment we need to penetrate.
VM: Why was India picked from your shortlist?
NB: Indeed, as we looked to provide true end-to-end support, that would include the Chinese speaking segment of Citi’s businesses and we were hard-pressed in India to find that linguistic legal talent. Which is what was drawing us to explore other markets. However, at the end of the day, given its pure legal talent breadth and depth, there was nothing that came close to India.
We will look to work through the language barriers by utilizing translation services where appropriate and decoupling our processes to leverage local language support from the respective local country franchises. So to the extent that is designed correctly up front, we believe there is a way to overcome that language barrier.
VM: How often do you engage with external firms for your work?
PR: When the work is going to be done for jurisdictions such as Hong Kong and Singapore, my colleagues will have to interact with the firms in those geographies as well, I think that is given. But to a large degree what is equally important especially for banks, but truly so for other enterprises as well, is that we believe in doing a lot of work in-house rather than working with external firms. I think there are areas where external firms will add value, we will continue to work with them there, but to the extent we can do things in-house we prefer to do that.
NB: Especially where the volume of the transactional work is somewhat predictable and consistent, we think twice about engaging external firms. On the other hand, when there are episodic matters, such as in litigation, and some of our larger syndicate deals, then of course we seek external help. But to the extent that we have consistency in our businesses, we are doing more of that in house
VM: You emphasized on the technology underpinning the legal functions. How is Citi adopting newer technologies?
NB: Absolutely! Robotics is one of those areas that we are really excited about. This is a key initiative for Citi as a whole.
The legal department as well is looking at that in a lot of different areas. Just recently we kicked off a number of pilots for robotics and smart process automation in the space of contract drafting, contract abstraction, invoice processing and review, settlements, accruals and reserves reconciliation and other legal operations processes as well.
While today this technology is still relatively nascent, there is definite promise that it is becoming smarter to the point where in the near future it can, for example, understand the sentiment of a negotiation and potentially add value in judgment based decisions. We believe in that vision and are fully invested in staying at the cutting edge of that.
VM: How often is Citi involved in litigation?
PR: About 95-98% of our litigation is consumer facing, and relative to the overall size of the business, we believe the size of consumer litigation is manageable. Anyway, the Indian franchise team looks at the whole, not just part of the hub. So some of that we use as a virtuous loop to improve our offerings, and litigations are used as a lesson to improve the processes and product features rather than seen as a problem which we have to deal with.
VM: What are the challenges you see in the foreseeable future?
PR: To my mind, firstly, whether our talent is positioned well to service across the globe; so some of it will be about the cross-team dynamics. We are hoping that with a couple of years of seeding, at least they’ll be able to rotate between different areas of practice and hopefully encounter newer areas for themselves as a path of growth.
Secondly, our businesses are located around the world – all of which are client facing. So for example, when we add Tokyo as servicing point, does that mean we will have to come in early to cater to Tokyo timings or will Tampa look into it till the time we start our normal day.
As long as people are focused on wanting a legal career that offers a multi-dimensional, multi-national or multi-cultural environment, we believe we can offer them that at Citi.