Mr. Susuki, Mr. Huang, Fellow Members of the Profession, Distinguished guests, Ladies and Gentlemen:
I am delighted and honoured to have this opportunity to speak to such a distinguished gathering of experts and professionals at this LAWASIA Conference. May I first of all extend my warmest welcome to all the participants of this Conference, especially those who travelled from overseas to join us here.
The inaugural LAWAISA conference on Legal Professional Indemnity Insurance was held in 2008 in Australia. Following the success of that conference, LAWASIA hosted the second conference in Singapore in 2010. Hong Kong is privileged to host this third conference this year. and the scope of the conference has been broadened to cover a wider range of topics relating to risk management.
Importance of Risk Management
The theme of this Conference is “risk management strategies”, and the well-designed programme covers a multitude of topics including “Global Risk for Lawyers” (which is the topic aptly chosen for the Keynote Speech to be delivered by Mr. Douglas Richmond) as well as other issues concerning professional indemnity insurance, risk associated in cross-border transaction work, and also ADR and Mediation.
We may not like “risk”, but it is a fact of life that risks do exist; the sooner we acknowledge the need to deal with risk, the better. As Mr Charles Tremper, a risk-management expert in the United States, once observed, "[t]he first step in the risk management process is to acknowledge the reality of risk. Denial is a common tactic that substitutes deliberate ignorance for thoughtful planning". A clear and sharp awareness of risk is very much an essential foundation for any meaningful discussion on "risk management" and its strategies.
Indeed, as business transactions become more complex and more globalized, the issue of “risk” likewise becomes more intricate. In its latest report on Global Risks released this January, the World Economic Forum noted that "[in] an interdependent, fast-moving world, organizations are increasingly confronted by risks that are complex in nature and global in consequence. Such risks can be difficult to anticipate and respond to, even for the most seasoned business leaders".
Arrangement in place for HK's Legal Profession
It is fortunate that the legal profession in many jurisdictions around the world, including that in Hong Kong, has over the years attached great importance to professional indemnity insurance and risk management strategies. In Hong Kong, the Law Society introduced compulsory professional indemnity insurance for solicitors as early as in 1980. The current Professional Indemnity Scheme was set up in 1989 under which indemnity was provided by the Solicitors Indemnity Fund.
The Professional Indemnity Scheme aside, the Law Society has been implementing the Risk Management Education Programme pursuant to the Legal Practitioners (Risk Management Education) Rules, which is a subsidiary legislation introduced under the Legal Practitioners Ordinance (Cap. 159). Under this statutory framework and with the assistance of relevant professionals, practising solicitors, trainee solicitors and registered foreign lawyers in Hong Kong are required to undergo courses on risk management since November 2004.
There should be little dispute that putting in place appropriate professional indemnity arrangement and training requirement on risk management is crucial for the smooth and healthy operation of the legal profession. In the face of a world of increasing risks, this is particularly important for the legal profession in the Asia Pacific Region. As the shift of global economic power from the West to the East continues, it would no doubt pose new challenges which have to be carefully addressed by the profession in different jurisdictions across the region. There is much we can learn from each other and share with each other. I am sure that this Conference will provide a good platform for participants to exchange their insights and explore room of future cooperation.
Legal landscape of Hong Kong
As a centre for legal services and dispute resolution in the Asia Pacific region, Hong Kong has to keep herself abreast of the latest trend and to catch up with the latest development in all relevant fields. Hong Kong has a strong legal workforce, comprising over 1,100 practising barristers and over 7,000 practising solicitors as well as around 1,400 registered foreign lawyers coming from various different jurisdictions.
Our strong pool of legal professionals provides a wide spectrum of expertise and world-class service in different areas of law. This is very important for Hong Kong to remain as an international financial and commercial centre as well as a cosmopolitan city. As a column in the "Hong Kong Lawyer", the official journal of the Law Society of Hong Kong, rightly observed this January,
"The emerging trend to globalise legal practices has also seen law firms expanding their operations to wherever their valued clients do business. As a result, Hong Kong has become an attractive base for international law firms, which contributes to the growth of foreign legal capabilities in the region."A recent highlight in the legal landscape of Hong Kong is the introduction of limited liability partnership (“LLP”). In July 2012, we enacted the Legal Practitioners (Amendment) Ordinance 2012 to allow law firms in Hong Kong to operate in the form of LLP. We are currently working on matters incidental to the Ordinance. Once the amendments come into operation, we are sure that they will help to ensure that our legal landscape is such that both local and foreign law firms would find it attractive to operate.