The new lawyer for an integrated ASEAN

my Trade Tripper column in the previous weekend issue of BusinessWorld:

Last week, the Association of Southeast Asian Nations (ASEAN) Law Association’s General Assembly had ASEAN integration as a main focus of the discussions. At the event, Senate President Franklin Drilon threw out the following query: “As the integration calls for a free exchange of resources, we must ask ourselves: what does integration mean to the legal profession? What is its impact to the practice of law? In this era of integration, the ASEAN lawyer must learn to navigate multiple legal jurisdictions.”

Indeed. And many have tried to address this evolving world, some suggesting liberalizing the legal profession (as Senator Drilon does). Others believe in making legal education “internationalized.” And some would have it specialized technically. With due respect, I believe such ideas miss the point.

First off, liberalization of the legal profession, of having a regulatory framework allowing foreign lawyers license to appear before local tribunals, is a pipe dream. Most national Bar associations will pay lip service to the idea but privately reject it. Frankly, nobody really sees the point of having a foreigner appear as counsel for a local court case. Clients won’t either.

But, the ironic thing is that lawyers have been “practicing” law in other countries for years.

This is true for many lawyers from any country: due to developments in international law and technology, law practice has long gone cross-border. Usually calling themselves “consultants,” they work in other countries giving advice or opinions on tax, customs, trade and international law issues to multinational corporations and international organizations. Foreign (including Filipino) lawyers have also risen as top executives in the Asian corporate world. All this without needing a law license from other countries.

The fact is, lawyers have outgrown courtrooms.

A study carried out by Reed Smith and KPMG finds top global corporations increasingly looking to the legal profession to fill senior management roles. Indeed, “CEOs with a legal background are currently represented on the boards of a broad range of industries including aerospace, pharma, publishing, retail, and oil and gas.”

The number of companies headed (or recently headed) by lawyers is perhaps reflective of the increasingly responsible and ethical modern business environment. A mere cursory list will include: Goldman Sachs, Bank of America, Cisco, Toys ’R’ Us, Nokia, Home Depot, Burger King, Pfizer, Fannie Mae, Delta Airlines, among others. Locally, there’s GMA-7.

Just in the recent past, the world’s top economic institutions were all headed not by economists or bankers but by lawyers: Pascal Lamy (World Trade Organization), Robert Zoellick (World Bank), Christine Laggard (International Monetary Fund). Former US treasury secretaries (the equivalent of our finance secretary) were both lawyers: James Baker III and Robert Rubin.

University of Asia and the Pacific’s (UA&P) School of Law and Governance has been ahead of the curve in this regard, foreseeing the need to develop lawyers with the skill sets and intellectual flexibility that enable them to work in courtrooms or boardrooms, in and out of the country.

Furthermore, UA&P’s School of Law and Governance has “governance” in its name for a reason. Borrowing from Columbia Law School’s Dean David Schizer (in a Financial Times interview in 2013): “Lawyers play a critical role in policy, particularly when it comes to shaping the rules that govern business practices.”

And more significantly, Dean Schizer points out: “You want the people who run the organization to think like lawyers; and you want the lawyers to think like people who run the organization.” This, he argues, “should inform how the law is taught because graduates often end up not as practicing lawyers but running businesses.”

Hence UA&P’s brand of legal education. US Justice Felix Frankfurter once said: “No one can be a truly competent lawyer unless he is a cultivated man.” The point is a liberal arts-oriented legal education. Doubtless one must pass the Bar exams and one should indeed prepare for it. But a law career goes beyond the Bar.

And unbeknownst to many is that a liberal arts education actually better prepares a lawyer in understanding international law, and navigating the nuances of the interplay between international law and domestic law.

Of course, legal education must seek to foster analytical skills, writing, persuasion, and sound ethical and technical judgment. But this is basic.

In today’s world of economic integration and easy access across countries, a lawyer must also have finely tuned collaborative skills, which not merely means the ability to work within teams but the capacity to work with other professional disciplines. Add too financial literacy and management skills (planning, organizing and utilizing resources), as well as culture sensitivity.

Ultimately, a lawyer must have the capacity to confront issues not merely from the black-and-white legalities but also from the perspective of the corporation or organization (or community) he is a part of.

Legal education simply cannot stop at mere technical training in law. The world (and the profession itself) has become much too complicated for that.


The Philippines with an ASEAN backyard

was my Trade Tripper column in the past weekend issue of BusinessWorld:

(The following are excerpts from my talk “The Philippines in the ASEAN Economic Community,” given during the Brown Bag Seminar hosted by the Embassy of the Republic of Korea, Feb. 24.)

ONE THING that policy makers and citizens really need to be reminded of is the concept of “adverse selection.” This refers -- roughly -- to a situation where a wrong decision is made due to the asymmetric information or even possession of wrong information by the parties.

In the context of ASEAN, the thinking seems to be that its integration this year would bring economic benefits that the country has long hoped for. But that is not consistent with reality. ASEAN brings opportunities. But that’s all it does. And thus the challenges.

Or to put it in even blunter terms, what is the point of opened markets if we don’t have the capacity to satisfy those markets? And what is the point of opening up the country for investments if the environment does not make it attractive for investors?

We are nearly last in terms of ease of doing business compared with other ASEAN countries; our power, transport, productivity, and infrastructure are nothing to brag about; and despite alleged improvements in relation to competitiveness, the rule of law and protection of property are a concern in most major studies. Then there is traffic.

Our exports also need work: our 2013 export numbers, for example, show a mere US$54 million paltry compared with Vietnam’s (US$129), Indonesia’s (US$199), Thailand’s (US$229), and Malaysia’s (US$230.7). For FDIs, the Philippines is celebrating its 3.86 (in billions US$) showing in 2013, even though the same is spectacularly short of Vietnam’s (8.9), Malaysia’s (12.3), Thailand’s (13), Indonesia’s (18), and Singapore’s (60.6).

Furthermore, most citizens are not even aware of the developments in ASEAN and that, sooner or later, a decision would have to be made on the Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership.

The Philippines has been so enmeshed with its domestic political developments that it failed to give proper focus to international economic developments that forge on regardless of what happens domestically and definitely have a significant impact on the lives of its citizens.

But perhaps that is the key to the problem. That many Filipinos (like many in the region) have not considered ASEAN as “domestic.” By this, I mean that we have not imbibed the mindset that ASEAN is our backyard, in the manner that Cebu or Davao is part of our neighborhood. In short, ASEAN is treated as foreign, far away, distant. This should change.

Almost 81% of our trade is with APEC, with ASEAN accounting for 20%. So while international trade, as we have been told, is global, geographic and historical realities nevertheless remain to be relevant.

And yet, technology and transportation developments have made it so that even the humblest of our citizens can engage within this setting. That they are unable to do so is not because of their lack of capacity or opportunity but because of the lack of information, which then leads to a lack of confidence.

Even in my own profession, which is law, there are many lawyers who still see international law as “foreign.” This despite the fact that our country, from its very inception, has always considered international law to be part of the laws of the land.

Government and policymakers (as well as media) have to encourage the mindset that these things are available, are within reach, and provide opportunities. This means having a professed international outlook paralleled by a pragmatic business orientation and competence.

Now, not to give cross-signals, we also have to point out the complexities involved in an ASEAN that encourages regional trading arrangements. Considering that local businessmen have continuously raised concerns regarding the Philippines’ capacity to keep up with its multilateral trading commitments, the increasing number of FTAs lead to a complexity that can be seen on the surface alone: the rules of origin, dispute settlement jurisdictions, non-tariff subjects such as market access and trade facilitation, sanitary and phytosanitary measures, technical barriers to trade, and (as always) the issue of smuggling. And the foregoing doesn’t even approximate the intricate effects that global finance has on trade.

My view on this has always been that the more technical and complicated a subject, the more important that someone has a generalized training that can match the complexity.

Others would go the different route: if a thing is complex, then hire specialists. But that doesn’t work for me for two reasons: hiring specialists to work on international trade will limit the nature of the analysis. It will also narrow the perspective for the recipient of the analysis, focusing on technicalities rather than on what’s really important.

Bottom line, the more complicated the environment is, get policymakers or analysts (even lawyers) with a truly well developed liberal education. They will have more analytical skills and appreciation for truth.