Increasing Chinese investment in New Zealand has presented significant opportunities, but language barriers have highlighted the lack of Chinese-speaking lawyers in local firms.
Faced with significant need for Chinese language skills to help tackle Chinese corporate and property transactions, Kiwi law firms are adopting a range of approaches to fill the skills gap.
According to Chen Palmer founding partner Mai Chen, language skills are invaluable for lawyers working with Chinese clients. “It is frustrating on both sides and is dangerous,” she says of acting in situations where there is a language barrier. “You can get some way down the track and then realise that there has been a misunderstanding.”
Dealing with demand
“The traditional approach, which was ours up until five years ago, is to take the view that we’re New Zealand lawyers doing New Zealand law in New Zealand, and if clients come down to buy a New Zealand asset, then it’s New Zealand law, New Zealand environment and the English language,” says Chapman Tripp partner Tim Tubman, who co-heads the firm’s China desk.
While this approach to working with overseas investors was fine for local firms when clients were coming from Australia, the US, the UK, and even Europe and Japan where investors have typically been bilingual, Tubman says that it has proved to be less than ideal for firms advising on the latest wave of foreign investment interest.
“We see more and more, particularly with the Chinese SOEs, they will have senior management that don’t necessarily have the English language skills, and so we think being responsive to that is now quite important,” Tubman says.
The big question that New Zealand’s firms are grappling with is whether the teams working with Chinese clients need Mandarin-speaking lawyers, or if using an external interpreter will suffice.
The challenge of outsourcing document translation work to interpreters is that they may not be familiar with legal words and concepts, and firms don’t have a way to assess the quality of the resultant translation.
Many firms have taken a hybrid approach – using external translators where needed, but also bringing up bilingual talent through the firm by recruiting Mandarin-speaking law graduates. “In the last five years we’ve been seeing a lot of people coming through [law school] with the Mandarin skills… there’s quite a high premium on getting them as part of the [graduate] recruitment round, they’re quite highly sought after,” says Simpson Grierson human resources director Jo Copeland.
“They’re getting amazing opportunities that other lawyers wouldn’t, and other juniors certainly wouldn’t,” she says, citing the experience of a bilingual junior lawyer who accompanied several of the firm’s partners on a trip to rural China.
Despite the opportunities on offer, big firms are facing competition for Mandarin-speaking law graduates from local boutiques with niche practices catering to Chinese clientele, and from firms overseas. “When they speak the dual languages, they want to go off to Hong Kong. Over there, if they can speak Mandarin they can earn two-and-a-half times the salary that they earn here, and they pay nine percent tax. You just can’t compete with that,” Copeland says.
Tubman agrees. “A New Zealand law degree is an international commodity… you’re fighting with the London market and the Shanghai market and the Hong Kong market.”
Yet recruiting Mandarin-speaking law graduates is not always the answer. A bilingual lawyer may have grown up speaking Mandarin at home, but there is a difference between conversational Mandarin and the language used in a business context.
Bilingual junior lawyers’ lack of seniority in a client context can also be problematic, Copeland observes: “What is difficult is that in Chinese culture the partner is really important and it’s a hierarchical kind of relationship.”
While waiting for the bilingual graduates and junior lawyers of today to reach partner level, some firms have sought to attract more experienced Mandarin-speaking lawyers from outside New Zealand.
“Firms have tried recruiting from overseas but it is quite difficult attracting them to come here. It’s probably easier to attract them into Australia where the salary rates are higher… attracting them to New Zealand is quite difficult, so it’s probably easier to get home grown people,” Copeland says.
According to Tubman, Chinese-born Western-educated senior lawyers are a rarity in the New Zealand market, and while local firms may struggle to recruit foreign talent on a remuneration basis, lifestyle factors may help to attract top foreign talent.
However, recruiting Mandarin-speaking lawyers from overseas is not without its drawbacks, Chen observes. “The lawyers may be able to speak Mandarin, but they may not be great lawyers. It is difficult to give them work for pakeha clients when there are no Chinese-speaking clients to advise… The lawyers appointed from overseas sometimes struggle to fit into a pakeha law firm culture and way of practising law, and to come to grips with New Zealand law,” she says.
However, language abilities are only part of the equation. “It is not just language but an understanding of culture,” says Chen. “It helps you interpret what the client is really saying, what the real legal problem is, and what they really want.”
Copeland agrees, and says that Simpson Grierson has been working on building cultural intelligence: “It’s not just the language skills, it’s the business skills, the social skills, the etiquette.”
While Mandarin skills are at the top of firms’ wish lists, other languages such as Korean and Cantonese are gaining importance.
Tubman also flags India as a source of opportunity for firms. “We’re thinking through India at the moment but we will follow the transactions. There’s a question mark over the degree to which India will see New Zealand as an investment destination and trade partner versus other regions, and then taking that, seeing to what extent specialised language skills are necessary,” he says.