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From his office on the 41st floor of HSBC’s headquarters at Canary Wharf, looking out toward the building site that will one day become London’s Olympic Stadium, Richard Bennett deals with a world of legal complications. Today, a new set of financial directives in Europe; tomorrow, one of the roughly fifty thousand cases the bank is defending in litigation-friendly Brazil. “It’s a fairly busy life,” he shrugs. “We have an awful lot of balls in the air.”

A thoughtful, understated man, Bennett has worked at the bank for 28 years and has been group general manager for legal and compliance for the past ten. He oversees more than 670 lawyers in 50 countries and is responsible for advising the board on the bank’s legal and regulatory risks. In recent years, as with general counsel at many companies, his role has become increasingly visible as management has grown savvier at using legal services.

No more is a lawyer merely an adviser of last resort—Bennett and his team are now seen as integral in achieving the bank's commercial objectives. “We’re not different to any other part of the group,” he says. “We’re accountable as anyone else for the overall cost of things.”

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That pressure means Bennett, like his counterparts at other companies, is constantly occupied with questions about how to improve efficiency and reduce cost: which work is handled internally and which is sent out to extrnal advisors? How are those external advisers managed? Are we paying too much? Can we cut costs by finding quicker, better ways of doing things?

In recent months, a number of innovative projects have been introduced by general counsel at some of Europe and America's biggest companies. Tyco, the US manufacturing giant, has scrapped the conventional practice of apportioning its legal work to numerous law firms at hourly rates and introduced a "partnership" with a single firm, Eversheds, for a flat annual fee of £8 million.

UBS, the Swiss bank, has brought in a system of ranking the advice given by external firms in an attempt to quantify the quality of their service. In the US, Cisco Systems has standardised every day functions such as patent applications and contract renewals and forced suppliers into finding cost reductions of 20 per cent a year.

Bennett admits HSBC is still only in the “foothills” of standardising its own processes, but he is exploring several developments. A trial project aimed at automating loan documents has been imported from Singapore to the UK. He is looking at outsourcing other "routine" legal work to a cheaper country so that his lawyers can concentrate on "value-added" tasks.

But the biggest development has been the creation of a global legal intranet. Bennett has hired an IT specialist to construct a knowledge database so that his lawyers will have access to information and documents within a few clicks, regardless of whether they are in Sydney, Hong Kong or Paris. Some of HSBC's external law firms (which Bennett says are "way ahead" on knowledge management) have been feeding their expertise into the project at no charge.

"The law firms were traditionally terribly protective of their know-how,” he says. “Now they seem to be quite keen in sharing it with us.”

Bennett agrees that, over time, the changes brought about by technology will be profound, yet he is measured in embracing it, if for no other reason than he is generally satisfied with the structure HSBC has in place at the moment.

HSBC operates a panel of law firms in each of the 50 countries it has a legal department—the largest is in France, with 128 lawyers—and a global panel of five firms approved to advise the bank in any country in which they have an office: Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters and Norton Rose.

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