As general counsel and corporate secretary of Hong Kong-based CK Hutchison Holdings Ltd., Edith Shih looks after the legal, regulatory and compliance affairs of that nation's largest conglomerate -- a company with more than 260,000 employees worldwide and business interests in 52 countries.
The Hong Kong-born Shih came to her position in an unusual fashion.
Originally trained as a musician and a teacher, she holds master's degrees in the teaching of English and in applied linguistics from Columbia University. She studied law at the College of Law in London and is qualified to practice law in Hong Kong, England and Wales, and Victoria, Australia. She was working in strategic planning and business development at a CK Hutchison affiliate in 1993, when her boss asked her to form a legal department and become its head.
"The new CEO said to me, 'Let's look at some of the legal risks we face. Where is the legal department?' and I told him, to his surprise, that there was no legal department," Shih recalls. "He knew I was a lawyer, so he immediately asked me to form a legal department, and I was the first lawyer. Now I supervise 220 to 230 lawyers in about 60 offices in 22 countries."
Shih says the first major step that she took as new head of the legal department was to prepare a legal policy firmwide.
"Every division was in charge of its own legal approval processes at the time, so the legal policy provided for all material transactions to be cleared by the legal department before execution and implementation," Shih says. "Hence , no major acquisition could be made and no expenditure incurred without proper legal review. Soon, more groups decided that they needed their own legal departments, so I sent some lawyers to them from the head office in Hong Kong and we built up the department that way."
Shih is quick to say that she enjoys participating in all aspects of business, not just the giving of legal advice. On June 3, 2015, CK Hutchison and its affiliated companies completed a major reorganization that was six months in the planning and six months in the execution, and Shih was a key player in the complicated transaction.
"We worked very quietly, without any leak of information, and we needed to keep it all confidential because if the news of the reorganization had leaked out and the share price was affected, the reorganization would not be viable," Shih says. "One purpose of the reorganization was to collapse the double layer listed company structure with Cheung Kong Holdings on top and Hutchison Whampoa below so that the hidden value of the group could be released and shareholder value maximized, and we did this successfully and quickly."
In the reorganization, Hutchison Whampoa merged with the Cheung Kong Group, which had already owned 49.97 percent of its stock. The company was renamed CK Hutchison Holdings and was reincorporated in the Cayman Islands. The companies' non-property businesses, including ports, telecommunications, retail, infrastructure and energy, were placed in CK Hutchison Holdings. At the same time, the property businesses of Hutchison Whampoa and Cheung Kong were placed in a new company, Cheung Kong Property. All continue to be part of a business empire owned in significant part by Hong Kong businessman Li Ka-shing.
CK Hutchison Holdings now has a market capitalization of about $700 billion HKD, or about $90 billion. Its diverse array of holdings includes some of the world's biggest ports, about 12,000 retail shops, and telecommunication operations in 14 countries. One of its most prominent brand names is the number 3; www.three.com is a Hutchison website.
The company has relatively few business interests in the United States. Shih explains that the company has not always found it easy to operate in the United States because of restrictions on foreign investment.
"When we have tried to venture into the United States, the number of regulatory approvals has been daunting," she says. "Telecommunication and container port operations are understandably viewed by the government as a national security issue, and we do understand that it is not easy for us to make acquisitions in strategic industries, so we have not expanded much in the United States."
Shih says that given her wide experience with 24 years in the company, she tries to contribute to the company beyond the strictly defined duties of a chief legal officer.
Shih wrote in a trade publication a few years ago, "I regard myself as a resource person, ready to be tapped as a sounding board or for a quick solution, or the house-view, or for a historical perspective -- or just a friend with a listening ear. I believe heading a department does not entail only technical expertise and know-how -- although those are pre-requisites. I think one of the most important attributes of a leader is the ability to enhance the development of team members such that they achieve professional and personal growth in their own right."
Shih devotes a high priority to nurturing and training her legal staff.
"The most valuable asset in any legal department," she says, "is its employees, so I spend a lot of time grooming them and interviewing applicants. I plow through the CV's that land on my desk. We don't use headhunters, so I conduct a lot of video interviews and I often travel to our overseas posts."
In addition, Shih holds regional legal conferences solely for Hutchison attorneys to keep them up to speed, to jointly review past projects that went well and those that did not, and to help the lawyers meet each other and develop new interests. These conferences take place in cities such as London or Hong Kong where Hutchison has a significant number of lawyers on the ground.
"I find that there are many lawyers in law firms who want to go in house, but if they think that's a way to find an easier life style, then my company is the wrong place to go," Shih says. "We do foster a great career path for lawyers who want to stay with us, and many of our lawyers have been here for 15 or 20 years. Lawyers can easily move from one company subsidiary to another one. There's a lot of opportunity for those who are willing. During the reorganization that we just completed, many of us were sleeping three or four hours a day."