A new administration and policies, the end of a pandemic, and fast-changing global trends all mean that law firms in Korea have their hands full when it comes to assisting clients in a dynamic environment. Leaders of three firms weigh in on their priorities going forward, and how they are adapting to keep up with the change.
ALB: What direction has the new administration of Yoon Suk-yeol ushered into the Korean regulatory landscape, and as a result, what are the policy impact on practice and dea-making environment in Korea and the Asia-Pacific region?
YOUNG JUNE YANG, managing partner, Kim & Chang: The new administration is expected to give greater discretion to the private sector to enhance corporate vitality but emphasise the value of fairness by revising current competition regulations and strengthening regulations on unfair trade practices.
The government has also expressed that they will continue to focus on occupational safety, fairness, and co-prosperity with respect to labour issues, and maintain the current legislative framework on reducing serious accidents in the workplace.
With Big Tech, the government pledged that it aims to foster new industries such as metaverse and digital platforms by expanding the use of commercial cloud services and software in the public sector and strengthening OTT services and other media companies.
The Yoon administration also announced plans to devise and codify practical measures to reduce greenhouse gas emissions and strengthen obligations to install EV charging stations.
KYU CHUL LEE, managing partner, DR & AJU: The Yoon administration aspires to revitalise private investments by instituting broad policy reforms. Demonstrating a strong will to deregulate unnecessary restrictions, the administration recently established the “Regulatory Innovation Strategy Meeting,” presided over by the president, and formed 37 regulatory innovation task forces in 37 government ministries. Accordingly, prospects are bright for the trade and investment climate of Korea and the Asia-Pacific Region.
However, it is too early to fathom whether the new administration’s initiative will usher in meaningful changes to regulations and facilitate private investment to create a welcoming environment for foreign investment and deal-making.
DR & AJU continually monitors government operations and actively participates in the policy-making process of government ministries to ease excessive regulations and prevent regulatory risks for our clients.
MIKE McCLURE, partner and head of Seoul, Herbert Smith Freehills: I’ve not seen much that will affect outbound dealmaking so far and a level legislative playing field will support investment certainty.
2021 saw a 32 percent increase in foreign direct investment overseas by Korean companies last year and I don’t see much evidence that will decline in 2022.
Importantly, the president has already signalled support for technology, the energy transition and private capital investment - all are areas in which Korea excels and in which we, too, are already very active in both dealmaking and dispute resolution.
ALB: What measures has your firm taken to adapt to the rising clientele interests in ESG investment and digital assets in the face of tightened regulations or potential crackdown from authorities?
YANG: Kim & Chang, through its ESG Practice Group, has been committed to developing its capability to advise on ESG matters. The ESG Practice Group is the hub organisation within the firm that connects the firm’s various practice groups to deliver a holistic approach to clients on ESG matters.
Kim & Chang also recently launched the ESG Management Research Centre which proactively advises clients in formulating their ESG vision, mid-to-long-term ESG strategies, establishing ESG operation and performance management system, and provides consultation services on clients’ ESG performance. The ESG Practice Group has now grown to more than 50 lawyers and experts working together to advise our clients on a broad spectrum of ESG issues.
Kim & Chang also provides comprehensive advice to local and foreign companies on blockchain technology and virtual asset-related businesses.
Under the current environment where areas of unclear regulatory standards exist or the government has yet to establish a firm policy, Kim & Chang’s Virtual Assets Practice Group collaborates with other practice groups specialising in FinTech, capital markets, AML, and foreign exchange transactions to provide our clients with comprehensive and effective legal services for novel and complex legal issues.
It advises on a variety of legal issues including ICOs and virtual asset transactions to a broad client base that includes virtual asset exchanges, technology companies, funds, and financial institutions.
LEE: DR & AJU established an ESG Advisory Group to help clients effectively cope with ESG issues, such as climate crisis, protection of human rights, and transparency. The ESG Advisory Group provides comprehensive advisory services regarding ESG management, including carbon neutrality, work environment, prevention of industrial accidents, fair trade in supply chains and proxy advisory. Furthermore, the ESG Advisory Group is supported by the recently established AJU Research Institute of Corporate Management.
Additionally, DR & AJU established a Metaverse and Blockchain Legal Support Team to provide future-oriented comprehensive solutions to entrepreneurs who are facing new challenges and entering an era of digital transformation in line with the emergence of the block-chain-based industrial ecosystem and transition to leading-edge technology, such as the Metaverse, NFTs, and DeFi. As existing regulations for investigation requests into unreported overseas exchanges, etc., are being strengthened, the Metaverse and Blockchain Legal Support Team has set top priority on providing advice to pre-emptively respond to this regulatory trend. As for the NFT, DR & AJU is conducting in-depth analysis and providing advice on copyright issues in particular. The grounds for direct regulation on virtual assets are still unclear, but DR & AJU is also closely monitoring overseas regulatory trends to enable prompt response when domestic regulations are introduced.
McCLURE: ESG is everywhere and heard in every client conversation. We relaunched our global ESG practice last year, with a focus on each ‘letter’ across the globe to answer those needs.
Similarly, we’ve been embedding digital literacy across our practices for some time. This year saw extra investment in both our own digital transformation as a firm and in the legal expertise required to manage complex digital and tech matters for clients.
It’s important for Korea’s global companies to have advisers who can manage the rapidly evolving web of laws and investigations triggered by ESG regulations worldwide. We’re currently handling a number of disputes arising from crypto and digital businesses both in Korea and in other parts of Asia.
ALB: Which areas of expertise is your firm planning to strengthen to bolster its competitiveness in the regional and global markets?
YANG: We recently launched the Russian Sanctions Task Force Team, as Korean and foreign companies are increasingly seeking advice on various legal issues related to sanctions and export controls imposed on Russia. The team advises on issues regarding export control measures against Russia and conducts reviews of existing and new agreements involving Russia.
The firm also launched a research centre dedicated to international tax issues. The centre, which is made up of experts and former government officials, will help companies prepare for new tax payment cooperation obligations that are aligned with global standards, especially as they relate to the impact of a two-pillar approach agreed to by OCED and G20.
We already have a strong team of Anti-Corruption & Corporate Compliance professionals, and we continue to build upon this practice.
LEE: Following the recent emergence of the Serious Accidents Punishment Act and ESG as key issues in corporate management, DR & AJU has promptly established a specialised advisory group comprising professionals with both expertise and field experience to deliver timely legal services.
Through the establishment of the Risk Management Group and the launch of proxy advisory services, DR & AJU has steadily built the capacity to provide services beyond conventional legal advisory and deliver comprehensive consulting with full coverage of general and strategic management issues. DR & AJU concentrates all resources to offer clients corporate-level support for anticipating and pre-emptively responding to changes in global dynamics or political and regulatory risks both globally and domestically.
Moreover, DR & AJU has implemented in full-scale a self-developed AI solution to significantly enhance the employees’ capacity to search and analyse legal documents, further improving the quality and efficacy of its legal services.
McCLURE: Asia is a growth area for our firm, and the rate of investment in systems and people across the region in 2022 so far has been exceptional.
We’re creating cross-practice ecosystems in the firm in priority areas such as energy transition, tech, projects and infrastructure, and private capital, blending our regional expertise in M&A, finance and disputes.
The 40-year heritage of our firm in Asia, coupled with a recruitment strategy focused on attracting and retaining Asian legal talent, provides the bedrock for our ambitions.
ALB: What combination of skillsets is your firm looking for in terms of lawyers who can better meet the demands of clients, as well as support you in your growth plans?
YANG: Kim & Chang’s greatest strength is that our clients can receive instant support from top experts who are familiar with the laws, regulations, and industries of any field, and find insightful solutions to complex cross-border issues. This is only possible because we have the country’s top-level experts who are responsible and highly motivated.
In our experience, talented attorneys are more than just a product of their academic achievements. As the nature of our practice requires a cooperative approach to client representation, we look for attorneys who are able to work within a team-oriented environment. We also are always on the lookout for talents who have a positive mindset, and who can be trusted by their colleagues and senior partners.
“Talented attorneys are more than just a product of their academic achievements. As the nature of our practice requires a cooperative approach to client representation, we look for attorneys who are able to work within a team-oriented environment. We also are always on the lookout for talents who have a positive mindset, and who can be trusted by their colleagues and senior partners.”
— Young June Yang, Kim & Chang
LEE: DR & AJU aims to grow with sincere and creative professionals who are proficient in communication and collaboration and faithful in their duties. We are looking for visionaries with initiative, responsibility, and interpersonal skills.
To help such professionals achieve their ambition at DR & AJU, we will continue to pioneer new services unprecedented in the legal market, paving the way for DR & AJU to advance to the next level as a leading law firm in various fields.
McCLURE: We seek out talented leaders who have the potential to become the future of the firm, both in Seoul and across the region. Our goal is to develop great Korean lawyers with both local and global mindsets who can act as guides to our Korean clients on overseas matters.
As we near our 10-year anniversary, we’re very proud of our investment record in Korean talent: from Dana Kim, our first Korean partner promoted from within the office, to the development from scratch of five paralegals now practising as associates in our London office.
ALB: What are the key takeaways that your firm acquired during the Covid-19 pandemic and what opportunities have you identified as economic activities gradually return to normal?
YANG: One key takeaway is how critical technology has been in getting us through the pandemic. It allowed us to stay connected with colleagues and clients despite social distancing. Virtual meetings saved us precious time spent on moving to and from different venues, resulting in big efficiency gains.
But virtual meetings reduced opportunities for training and mentoring associates that only personal interactions allow, and weakened personal bonds that construct a sense of common purpose and belonging. We compensated for this by stepping up all-firm communications, boosting one-on-one mentoring, and being more systematic about group activities and get-togethers (as permitted by COVID). But this is still a work in progress.
Fortunately, reduced personal interactions with clients haven’t led to the fraying of client relationships we feared, as we learned to be more creative and proactive about client outreach. Frequent, customised webinars and personalised briefings, for example, proved to be an effective way to remain connected with clients.
With the pandemic being a wake-up call about the power of technology, we will be looking more seriously at AI and other technologies, not only to boost efficiency but to make work even more satisfying and client-focused.
LEE: The COVID-19 pandemic has turned the world upside down. The norm has become the abnormal; the unimaginable has become reality. When everyone was waiting out the storm wrought by the pandemic, DR & AJU was counting the silver linings. Using the COVID-19 crisis as an opportunity to streamline operations, develop new projects, and lay the foundations for internal integration, DR & AJU seized the chance to gain higher ground in pioneering new areas of business for the post-Covid era.
McCLURE: The incidental impact of the pandemic in spurring rapid digitalisation and the transformation of virtual workplaces and global negotiations or hearings were well handled by Korea’s companies.
We’re not preparing for normality though. The economic and geopolitical aftershocks of the past two years are only just being felt and the real impacts of climate change are now obvious.
Global companies are securing and diversifying their supply chains, for instance, while post-pandemic increases in inflation are creating a very volatile world for deal valuations and executions. Being international and inter-connected allows us to support clients as the business and economic environment changes.
Climate change and its effects have complicated this year’s energy and food supply problems and caused governments worldwide to face crisis upon crisis. Our advice to clients needs to balance medium-term business goals with the capacity to absorb short-term emergencies.
The ability to transfer legal and business solutions from around our international network for regional execution also gives us an edge in such uncertain times.
