Streamlining legal operations is never easy. But as regional general counsel for Rabobank North America, Philip Kirkpatrick embraces the challenge head-on.
Since taking on his role in November 2017, Kirkpatrick has focused on integrating two previously separate legal departments. That move, in turn, has helped the multinational banking and financial services company shore up rural and wholesale lending opportunities provided to U.S.-based individual, business, and agricultural clients.
Internal teams also benefit from such consolidation, Kirkpatrick notes. “By working closer together, we are also creating new opportunities for learning, skill development, and career experiences,” he said. “Our next initiative is to create a unifying vision.” Here’s how Kirkpatrick plans to get there.
Your role encompasses both Rabobank and Rabo AgriFinance—how do you unite these two areas?
Historically, Rabobank has operated two separate divisions in North America—Rabo AgriFinance, which is our rural lending business, and Rabobank Wholesale, which is our wholesale lending and markets arm. We are working to closely align these two businesses to offer our clients a stronger value chain from the farm to consumption.
Through this initiative, we are working to fully integrate two legal departments. In bringing the rural lending and wholesale lending legal departments closer together, we are able to leverage resources and expertise and make quicker decisions.
Our integrated legal department consists of three managers who each oversee a domain that covers cross-businesses activities: wholesale and lending activities, collateral and corporate governance, and litigation and recovery.
We structured the teams to eliminate the idea [of] two teams in favor of becoming one legal team that covers two businesses. By working closer together, we are also creating new opportunities for learning, skill development, and career experiences.
Fostering team efficiencies is a common challenge for legal departments—how have you successfully implemented lean process improvements?
Continuous improvement is an area where our legal department has excelled. Our first project, in 2015, was focused on reducing waste in the legal review process and creating turnaround time metrics to share with our business partners.
We then began to outsource certain areas of the legal loan review function and leveraged a continuous improvement project to review how we work with outside counsel and use more robust statistical analysis for this relationship.
Last year, one of our attorneys led a continuous improvement project to look at how the legal department engages with and responds to legal questions. As part of this project, a Sharepoint-based tool was developed to track requests, identify trends and common concerns, and monitor response times.
Currently, our markets legal team is reviewing how it handles derivatives, and expects to leverage Sharepoint to provide a different user experience. We have continued to provide more robust reporting metrics to our stakeholders and improve turnaround times to deliver an excellent customer experience.
What are your most important big-picture responsibilities and how do you balance them with day-to-day demands?
In late 2017, we moved from a legal entity coverage model to a functional model, combining the two legal departments into an integrated department—and in doing so take a holistic view across our businesses.
This approach will help us better serve all business activities and our clients. The effort to transition our team members into one integrated group with the ability to flex across businesses when they need to is ongoing.
This transition requires much of my attention, and balancing this with the day-to-day activities of the legal department can be challenging. We often encounter time constraints as we work to train each team member on the various lines of business.
It is critical to ensure we are taking a risk-based approach to provide Rabobank with prompt and effective professional advice while nurturing and strengthening relationships. It is important to support the business to accomplish the various needs with the appropriate countervailing power.
The key component in this is our focus on culture, of which a key element is accountability. A strong culture is so important to what we do that it is a component of all team members’ KPIs.
What actions has Rabobank taken to strengthen its internal controls and risk management functions to ensure compliance with U.S. regulations?
Continually strengthening our internal controls is, of course, of the utmost importance to us. In fact, having more control is one of the key reasons we chose to further integrate what had historically been separate businesses.
In doing so, we established one leadership structure (there had been three) in North America to deliver one voice to the regulators. By streamlining our organizational structures and processes, we were able to create efficiencies and increase our effectiveness across the organization.
Rabobank continues to strengthen its overall risk management framework front to back, and has rolled [out] a new risk-and-control framework (RCF), which will near completion by the end of 2018. RCF will significantly improve and streamline the way our businesses run and control their activities.
As a Missouri native, how does your legal work in sustainable food and agriculture financing keep you grounded in your community?
I work for an organization that values both stewardship, through sustainable agriculture, and volunteering, and I feel privileged to be a part of this team. Our legal department provides exceptional value and is committed to each other’s success both big and small. I am fortunate to work with really incredible attorneys and colleagues.
As you near your five-year anniversary with Rabobank, what are some of your biggest team accomplishments—and where would you like to direct your efforts next?
One of the biggest accomplishments was our ongoing outsourcing of certain legal loan review functions to the law firm Thompson Coburn. As a result, the rural business realized significant time and cost savings, as well as a reduction in documentation errors. This initiative with TC was a finalist for the 2018 Association of Corporate Counsel Value Champions award.
Our next initiative is to create a unifying vision. Our team will develop it collectively to refine our processes, improve alignment with head office, and enhance our controls, ultimately allowing us to better serve our (internal and external) clients and achieve growth.
It is imperative that I create an environment where it is safe for all team members to share their ideas and thoughts. Through these steps we will create a shared vision that all team members own through authentic alignment—which will mean setting aside personal preferences to support the decision on our collective legal team’s vision. We will kick-off this project in April and will involve our full team to develop our vision.
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