Choosing wisely
Francisco Javier Castillo Palacios, lead counsel for Dow Ibérica, Turkey, Russia and CIS, says choosing the right law firm can be problematic, but he adds that the increasing use of technology is making it easier for the company’s in-house team to perform the plethora of tasks for which it is responsible
Selecting the best legal advisers for your business can be difficult. Francisco Javier Castillo Palacios, lead counsel for Dow Iberia, Turkey, Russia and the Commonwealth of Independent States (CIS) countries, declines to reveal which external law firms Dow uses, but he says the company works with firms that are well known in the countries where Dow has operations. However, Dow also works with boutique firms and medium-sized firms on more specialised matters. The company, Castillo explains, has a global list of firms, and conducts a process for approving each new firm before adding them to the global list. Castillo says that choosing a firm is not an easy task, especially when they are far removed from the company’s usual legal environment. “It depends on the country,” Castillo explains. “In Iberia, I have more direct knowledge and use firms based on professional skills and my own criteria – in other jurisdictions, references, legal publications, or even information from other professional colleagues or institutions, usually helps to make a good decision.” Madrid-based Castillo acknowledges that, although he is always ready to listen to understand the capabilities of all law firms in case there is an opportunity to improve on something, there are occasions when firms fail to convince him to use their services. Castillo say this is “either because the firms do not have a certain profile, or because there is a conflict of interest between the firm and some other client”.
NEEDING EXTERNAL HELP
Chemical giant Dow has annual sales of around $54 billion and approximately 46,000 employees worldwide. The company has had a presence in the Iberian Peninsula since 1960, and has continually invested in the region since then. Currently, Dow’s Europe, Middle East, and Africa (EMEA) legal team consists of 11 lawyers – each of which has different geographical or business responsibilities – who are supported by a team of paralegals. The EMEA team is led by a general counsel based in the company’s headquarters in Switzerland, with other counsel responsible for different regions and areas of the business. Though in-house lawyers at Dow may be based in a particular location, their work still involves serving other jurisdictions and other parts of the business. Castillo, who joined Dow 21 years ago, is also responsible for the Dow AgroSciences EMEA region. Castillo deals with any issue that arises in his designated areas – this largely consists of commercial matters, international contracts, M&A and corporate projects, but also other areas such as labour and data protection. However, sometimes the in-house team does need the help of external advisers when handling other types of matters. Castillo says this is especially the case with litigation “in which we only coordinate, but do not intervene directly”. Dow also uses external lawyers when it needs help with highly specialised issues or in instances where, due to limited internal resources, the company is forced to resort to using external lawyers.
TRUST IS ESSENTIAL
It is no secret that, nowadays, it is essential that firms, whatever their size, are able to prove they have an impeccable reputation. This is something that Castillo is very clear about when choosing the external advisors with whom he works, with “a wide range of experience and professionalism being the priority”. However, as in any area of life, good personal relationships, accessibility and trust are essential values for a good business relationship. “Good personal treatment is obviously essential when working closely with someone,” Castillo explains. “For companies like ours, honesty and good ethical practices and compliance are an essential requirement [for law firms] without which there is no possibility of working with us.” In general, Castillo is very pleased with the firms with which Dow works. “My level of satisfaction is very high with all of them,” he says. However, Castillo adds that sometimes slight frustrations can arise. “We like firms to be practical and efficient,” he says. “Frustration can come when firms fail to quickly get to the point or teams are used unnecessarily – luckily, it doesn’t usually happen, and we handle it well together.”
COST CONTROL PRESSURES
When evaluating the performance of external advisors, Castillo says that, not only does Dow “measure the economic result, but also how they have oriented the subject and whether it has been done in a sound way, even if the final result is not as expected”. Other factors Dow considers when measuring performance include “the cost of the office versus the service received”. Although the legal department’s budget has not changed in terms of figures over the last year, “we do have strong pressure on cost control in general, and are always looking for greater efficiency,” Castillo says. Castillo explains that Dow Chemical has just gone through a transformation process that has involved mergers and spin-offs and as a result the company is adapting to its new structure. “That is surely the most immediate challenge, the idea of aligning the legal service to the reality of the company,” Castillo explains. Looking to the future, the company is strongly committed to innovation and the use of the best technology. “Our global tools are becoming more and more sophisticated,” says Castillo. “Whether it’s case reporting, fee management with law firms or project coordination.” He adds. “We have teams specifically dedicated to improving tools or advancing those that are technologically more appropriate for the global team.” Such tools help the company to efficiently perform tasks that would otherwise be difficult to handle in multinationals such as Dow, Castillo says. He says they include “internal systems where the information of all lawyers and cases is deposited, as well as a specific legal intranet where all models of contracts, all types of documents, as well as legal contacts from around the world are deposited to increase the speed in which agreements are obtained or the best legal support is located.”
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