Keynote Address by Ms Indranee Rajah, Senior Minister of State, Ministry of Law and Ministry of Finance, at the UK Singapore Law Students Society (UKSLSS) Singapore Legal Forum 2017

05 AUG 2017

5 Aug 2017 Posted in Speeches

Good morning everyone.

Introduction

I last spoke at the SLF in 2015, so I’m happy to be here again.
It is particularly apt that the theme is “What’s Next for Singapore’s Legal Practice”. It’s important for the next generation of legal talent to think about this topic, because the legal sector in Singapore, and the rest of the world, is undergoing significant changes. I want to take the opportunity to speak about some of these changes and the implications for you.

Change
Singapore’s legal sector has done well. The nominal value-added of legal services has increased from about S$1.5 billion in 2008 to S$2.2 billion in 2016 – a huge jump. Our top law firms are also the largest in the region. Our top lawyers are recognised worldwide for their expertise, e.g. in disputes. That’s important if you think about it. For a small country, to have practitioners with global recognition – that’s no mean feat. Government has also built on our strength as a business hub, and our reputation for neutrality and rule of law, to grow the sector.
But the legal sector is not immune to change. Economic trends are changing where and how business is done. The legal services sector is dependent on the broader economy. It is inevitable that when you have changes in business globally, there will be changes to the legal sector; it will be affected. This was one of the reasons why the Government set up the Committee on the Future Economy (CFE); to look at how we need to prepare ourselves for the challenges and opportunities that arise from these trends. As part of that work, I co-chaired a Working Group on Legal & Accounting Services which took a look at where we thought the legal and accounting services sectors would be, where the synergies are, and how we could position ourselves, the professional services, for the future.
What are these trends? Let me share a few with you.
First, the growth of Asia. The economic centre of gravity is shifting towards Asia. In particular, ASEAN is expected to grow at 5.2% annually until 2020. Very promising compared to the IMF’s forecast of 3.5% growth for the world this year. What this means is that there will be opportunities for legal work in the region. Firms and lawyers will have to develop regional capabilities, familiarity with regional laws, and ability to work with regional clients.
It is not going to be sufficient to be comfortable just working in Singapore alone, with Singapore clients. That’s still important, but it won’t be the only part of practice. You do need to look regional, beyond our shores, even as we retain our uniquely ‘Singaporean’ expertise and brand of excellence. Many of our law firms already have regional networks to tap on for advising on cross-border deals. But we must deepen our understanding of regional laws. You are familiar with English law and laws of the Commonwealth countries, but less so with the region. And this is a gap that must be addressed. This is so that when a deal comes up involving a party from a particular country, we will be the natural partner of choice, because we know and understand the country in which the party is operating.
Our academic centres of excellence are contributing to this effort, strengthening our thought leadership in this area. For example, NUS has the Centre for Asian Legal Studies and the EW Barker Centre for Law and Business, while SMU has a Centre for Cross-Border Commercial Law in Asia.
Second, globalisation is increasing the competition for the legal sector. Straightforward work can be easily done in a lower-cost jurisdiction, by fewer lawyers, for a lower price. At the same time, regional firms are also aggressively increasing their presence in Singapore and in the region, as they too want to be part of Asia’s growth. We are not the only ones who’ve taken note that Asia is the growth area for the next decade or so.
That has added impetus to boost our regional capabilities and add value to our services. If you want to be competitive, you must be able to offer something unique and different from what everybody else is doing. Because if you can’t do that, why should they choose you? Think about that – it is important to have a unique value proposition, in light of the fact that there is increasing global competition in the legal sector.
Third, technology is transforming legal services. Routine tasks are increasingly being automated, while artificial intelligence and machine learning continue to grow in sophistication. Individuals are already bypassing lawyers to obtain legal services online. E.g. Amazon and Alibaba have integrated online dispute resolution platforms to settle claims and compensation without the need for lawyers.
Technology will put pressure on law firms and lawyers to differentiate their services and deliver what an algorithm is unable to do. But what this means also is that law firms and lawyers who embrace technology can increase their efficiency, focus on higher order work, and even create new types of legal services.
The takeaway is not that technology or AI, will replace lawyers. There will always be room for lawyers to work. But the nature of the work will change – how you do it, and what the clients are willing to pay for will change. What technology, automation are doing is that they are taking away the routine things that you would normally have done before. Basic research, checking of documents – manual, repetitive things – these will increasingly be taken over by machines.
What this means as a lawyer is that you have to do the higher order work that machines cannot do. The law is about people and society. There is only so much that you can automate; but there is a lot you can do in terms understanding human nature, people’s responses, and doing the higher value work – giving the strategic input, understanding the clients’ businesses – and the ability to draw all this together. These are things machines can’t do, and this is where you should position yourselves.
Fourth, the upshot of all this is that clients are demanding ‘more for less’ from lawyers. It is no longer sufficient for lawyers to just have a sound grasp of the law or technical knowledge. Clients want lawyers to have:
- Specialist knowledge.
- Over and above that, they want you to have industry experience and business acumen. They want you to understand their industry, their challenges, and then be able to interpret in the context of the law what they should be doing, and assisting them to understand this so they can formulate strategies and think ahead.
- They are also looking for lawyers with deep regional expertise.
These attributes will give our lawyers the ability to ‘see around the corner’, and guide clients in making strategic business decisions. And it is qualities like these that will keep us ahead of the competition.

Entering the Legal Sector
What that this mean for you? I know that these trends may sound rather abstract for now. At the moment, you will be focused on passing your exams, getting your degree, and thereafter a Training Contract (TC) and a job. But keep these trends in mind as you prepare to join the workforce, whether as a practitioner, in-house counsel, legal service officer, academic, or even in a role that is unrelated to law. Let me explain how and why.
I think that the majority of you intend to go into practice. After graduating, your immediate priority may therefore be to secure a TC. Those of you not intending to practise should be fine, as after graduating you will go on to do whatever else it was you intended to pursue.
For those of you looking for a TC, the majority of you should be able to find one, hopefully with the firm and training supervisor of your choice. [EG(2] Once you have secured a TC, you will be on a well-trodden path. But even then, please bear in mind what I said just now. Getting the TC and even being retained is not enough. You should, at an early stage, start thinking about your area of specialisation. For the first couple of years, you may not be able to specialise, depending on the firm you are with and whether they do more generalist or specialist work. But you must start thinking about it yourself – where you want to be in five years? Ten years? And if you say that you want to be the top lawyer in information technology, then from an early stage, you should start to seek out the opportunities to acquire that expertise.
It will not come to you if you just sit there. Search it out – look and see what’s new on the horizon, take the initiative to talk to people in that space, develop deep knowledge of that area. Start carving out your future path from an early stage. And start thinking about opportunities to develop regional knowledge. You are in the UK, so many of you would be familiar with the UK and London. How many of you are familiar with Vietnam, Thailand, Indonesia, Malaysia – our neighbouring countries and the countries in which the growth will be taking place? If you want to advise on law – law follows business, and business is taking place in the region – you won’t be able to do it effectively unless you know the region as well. So for those who get TCs immediately, bear these things in mind as they will prepare you for the future.
But competition is keen. Places are limited and getting a place is a function of supply and demand and market forces. There are many contenders. So some of you may not get a TC. The question is what you do then. You might have to take a different approach. It doesn’t mean you won’t land up where you originally wanted to be. But the path may be slightly different. And different doesn’t mean bad – different just means different. And you can turn this into an opportunity. I’ll explain.
If you didn’t get a TC, what happened? What happened is – this is a function of demand and supply. The places are limited, there were more applicants than places, and the law firms will choose the people who meet their needs. It is not necessarily the case that you weren’t a good applicant, but that they have enough people for their corporate work, they need some for litigation, or vice versa. So there are many variables, and you shouldn’t beat yourself up if you can’t get a TC.
But you must understand that it’s a function of demand and supply. And if somebody is to take you on, what do employers – the law firms – look at? They look to see which applicant has something different, a value proposition more than what the others have. For graduates, you are all starting at the same stage, except for the few who are doing this as a second degree and have working experience from before. Largely everybody is at the same stage, there is little to distinguish people beyond your grades, what internships you’ve done, or a little bit of your extra-curricular activities. So if everybody looks roughly the same, law firms choose those that they have a need for or those that fit their organisation.
But if somebody in that group really stood out for some reason, the employers are going to pay a lot more attention. So how do you make yourself much more attractive in terms of the ability to secure a TC? This comes back to the things I was saying earlier about what the clients are looking for – specialist knowledge, knowledge of their business sector, people who have regional expertise, people who can help them see round the corner. That’s what the clients need, that’s what the law firms will eventually be looking for.
So one of the things you might want to consider, if you’re not able to secure a TC immediately, is working in the industry to give you an understanding of how it operates, to give you a network of contacts, and hopefully even some regional exposure. Don’t get me wrong – I’m not saying not to take up law. I’m saying, if you’re not able to take up a TC immediately, get some experience in the industry that you think you might want to specialise in. And after two, three years – and it may seem like a long time, but I assure you it will go by very fast – after two, three years, you then have many more options. If you like it, you can choose to stay in that industry. You might want to go in-house. Or you might want to go somewhere else. But you are also then in a position where you can come back and say, I want to do a TC, and unlike the others, I have experience in this industry. I know the people in this industry, I know how it is playing out, and I can bring this knowledge, this added value to the table.
So, just a simple example – if you are interested in project finance, you could first work in the business team of a bank that does infrastructure financing. You could be in-house counsel, but you need not necessarily have to take on in-house counsel positions, because the banks recruit from a wide range of backgrounds for all types of positions. If infrastructure finance is what you want to do, then being part of an infrastructure finance team is very important because you get to know how these deals are structured, the players, the relationship between the public sector and private sector. You know that space, and later on, when you go to a law firm that has work in this area, you’ll be able to say, I know these guys, I know how the deal is structured, this is the value I can bring to the table. And this is something the other applicants may not be able to provide.
That is a strategy you may wish to consider. You need to think about how you want to position yourself for the future, you need to look at what the future needs and demands, and it demands those things I told you about – specialist knowledge, regional knowledge, industry knowledge, the ability to know who is operating in a particular space. If you can get those under your belt, it will put you in a much better position to secure a TC.
Which areas to go into are very much a matter of personal preference and where you think you’d like to be. But if you need some clues or signposts, you may want to read the CFE Legal & Accounting Services Working Group Report. We identified some high-growth areas – not exclusive, but which we think have the highest potential. But as things come along you may find that in the next two to three years, other areas will start to develop. So you should also keep your own antenna out to try and understand what’s a new growth area, what’s relevant.
But let me just run through a few.
- One of the high-growth areas is projects & infrastructure. Asia-Pacific’s infrastructure spending is expected to exceed US$5 trillion by 2025. Infrastructure work is complex, involves many parties, and will require legal support. We are positioning Singapore to be a regional infrastructure hub to meet this demand. All of you have heard of the One-Belt-One-Road (OBOR) or Belt-Road Initiative (BRI). Asia has a lot of demand for infrastructure, so you can be sure that there will be demand for legal work. It can be at the early stage, for example project finance, or it can be at the disputes – some of them potentially very large, not just in the millions but billions. So there’s a whole gamut and it’s up to you where you want to be, if you have an interest in infrastructure work. There are various options where can you get such experience: financing institutions, project developers, consultancy firms, advisory arms of accountancy and engineering firms.
- There is also finance. This is a key driver of demand for legal services, with cross-border financing activity generating high-margin legal work. A bank, accountancy firm or larger corporation would give you good exposure to such work.
- We’ve already had some success in dispute resolution. We have built up strong institutions which will need good talent to support their growing caseloads. The Singapore International Arbitration Centre (SIAC) achieved a record 343 cases last year, surpassing the London Court of International Arbitration. Working in an arbitration institution such as SIAC could also allow you to understand the ins and outs of how they function. That is very useful should you decide to become an arbitration lawyer.
- We have also been developing Singapore as an IP hub over the past few years, to provide the necessary foundation to drive innovation. We have been keeping our regime updated – passed the Patents Amendment Bill in February, now reviewing the Copyright Regime, updating our Designs Regime. We provide a framework of protection for IP-based businesses, who will then leverage lawyers to support their strategies.
- Other sectors that the CFE identified include risk management, corporate governance, business valuation and restructuring.
- And then there’s technology. New fields are growing rapidly – blockchain, automation, data analytics – the list continues. This is the fastest growing area really, across all sectors. Singapore is also building up itself as a Smart Nation. Law practices with TMT practices will need people who understand the technical and business aspects, and can engage clients credibly. A stint with the legal and compliance teams of some of the infocomm technology companies or even start-ups would provide this.
You may even want to consider working elsewhere in the region, or in a role that gives you exposure to other countries. Again, I mentioned infrastructure work. To give you a sense of where the growth is taking place, besides the BRI, India and Indonesia’s infrastructure spending is also projected to reach US$660 and US$165 billion respectively by 2025. If you have the opportunity and are able to find the right kind of role overseas, you might want to consider that as well.
So at the end of the day, I’m not saying “Don’t practise”. In fact, I hope many of you get your TCs immediately and join the profession. And if you do, please bear in mind what I’ve said. But if for some reason there are some of you who don’t get your TCs immediately, that’s not necessarily a closed door. There’s another way and another path to achieve your goal, if your goal is to practise. And what you must do is to maximise the opportunities available to you. Asia is growing; there are opportunities. But in order to access the opportunities, you have to get under your belt those qualities I mentioned earlier. Because if you don’t, other contenders will occupy that space. So I hope that this is something that you take on board, and you see this as an encouragement, both for those who enter the legal sector immediately and for those who might have to wait a little while. But there is opportunity, and it’s accessible if you make sure you get the right skills and attributes.
For those of you who are starting immediately, the Singapore Bar already has a high level of technical quality. That is a fundamental requirement of all our lawyers. The Bar examinations are there to ensure quality and should not be taken lightly. But even that is not enough. You do need to increase your value proposition and demonstrate that you have specialist expertise, industry experience, and knowledge of the region. And you have to acquire the business acumen to be a trusted advisor to your client.
How do you do this once you start work? You can do this is through secondments and internships in non-law sectors or law firms in the region. That’s helpful because once you start practice, you are immersed in the technical aspects and very focused on the work and advice and projects that come your way. But that does not always give you the opportunity to look ahead, and take some time off to see where your particular specialist area is going. So if you need to do that, you may want to do a secondment with a client.
A secondment is also useful when you are trying to develop capability that you do not already have. For example, you may be familiar with general corporate work. But let’s say you are not so familiar with the oil and gas industry, and you want to gain some knowledge there. A secondment with an oil and gas client may provide you with an opportunity to gain that kind of knowledge. So it’s all about putting yourself in a place where you can get the knowledge and expertise, and the networks and contacts, that are necessary for you to move forward in that particular area.
You should also read widely, network, and talk to industry leaders to acquire a deep understanding of the areas you want to specialise in. So please don’t only talk to lawyers. Talk to others as well, especially those in the area you want to specialise in. For example, if you want to practise banking and corporate law, you should be reading Financial Times and Business Times; if you want to go into tax, you should really to understand the ins-and-outs of issues such as base erosion profit-shifting, transfer pricing, Automatic Exchange of Information and so on – and get a deep understanding of these issues.
So the takeaway is this: know yourself, know the area you want to be in, and become the expert in that area.
And don’t underestimate the importance of general business skills. What I talked about earlier was specialist, sector-specific skills. Law is, after all, also a business. So you have to acquire business skills. You need to be able to market your services, in accordance with professional rules, you have to get out there, and people must know what it is you are doing. You have to develop strong relationships with in-house counsel and clients, and this will be increasingly important as we regionalise. If clients are unaware of the strengths and services you provide that won’t help you – you will only able to secure the work if people know of you. So business development, marketing, strong relationships with clients, is important.
On that, just one caveat. Strong relationships doesn’t mean doing everything your client wants you to do. As a lawyer, your first and paramount duty is to uphold the law. That is the unique value proposition of a lawyer. You understand the client’s concerns and needs and you also know the law. Your job is to help the client navigate what they need to do, and ensure they do it within the constraints and parameters of the law.

Fundamentals
I began by speaking about change and touched on the many changes that we have to deal with. It may sound daunting. But the Singapore legal sector is in good position to do well. We have solid fundamentals – a stable, trusted, and neutral legal system. And we have the rule of law.
We are recognised as a hub for doing business, and are working to make Singapore a trusted global exchange for financing, brokering and structuring international commercial transactions.[EG(3] This will generate more demand for legal services.
You are in a good position to do well too. First, you would have a law degree obtained in the UK and would already have overseas exposure. You would be aware that English law is the most widely used governing law of international commercial contracts today. Singapore commercial law is pretty much the same as English law, and Singapore law is gaining popularity as a choice of governing law. A survey by SAL showed that Singapore law is the second most preferred choice of governing law in cross-border transactions after English law; and in the region, we are first. So if I were you, I would try to seek admission to both the UK and Singapore Bars. We understand that some of you may have commitments in Singapore and have to return to Singapore after graduation, but there’s nothing to stop you from seeking UK qualifications later. In fact, the Ministry of Law supports the UK Qualified Lawyers Transfer Scheme (QLTS) under the SkillsFuture Study Awards, where successful candidates will receive $5,000 to defray the cost of the course and assessments.
Second, you are a tech-savvy generation. Please continue to embrace technology. Use it to enable your work, and to innovate. These will serve you well. The Government will work closely with you, the law firms and industry, the courts, and companies, to seize new opportunities and overcome challenges.
And above all, whatever you do, hold fast to your values and ethics, and never compromise your professionalism and integrity. Law is both a privilege and a responsibility – something you must discharge, bearing in mind your responsibility to society and the country because of your unique position as a lawyer.

Conclusion
With that I would like to conclude by wishing you all the best. Whether you end up as a practitioner, legal service officer, or some other capacity, remember that you have an important part to play in the future of the legal sector in Singapore.

Video highlights from speech

Last updated on 27 Dec 2017