When Sylvia Fang decided to move in-house two decades ago to Taiwan Semiconductor Manufacturing Company (TSMC), she planned to stay for two or three years, then return to her career in private practice. The fact that she is still there today, now serving as General Counsel, is testament to the rewarding nature of working at a company founded on strong values.
TSMC is the world's largest semiconductor foundry. If you own a car, a cellphone or any other electronic devices, most likely there is a TSMC chip inside. The company's employee base has grown from 3,000 employees in 1995 to 45,000 worldwide in 2016. TSMC has a market capitalization of approximately US $110 billion and annual revenues just over $26.6 billion. In December 2015, the company announced plans to build a US$3 billion wafer fabrication facility in China. It is also said by the media to be the sole manufacturer of the A9 chip inside the new Apple iPhone 6/6s.
As a senior associate at Taiwan International Patent and Law Office (TIPLO), a leading boutique intellectual property firm, Fang developed expertise on general corporate and IP issues. Although the work was rewarding, something was missing: "We did things for our clients, but I felt that the results lacked real impact," she says. In her search for an in-house job, Fang's goal was to become a better corporate lawyer; her ambition was to join a global company that truly valued its legal department. "Fewer companies had in-house law departments at that time," she says.
Despite its size and extensive reach, TSMC boasts a cohesive and consistent corporate culture based on values of integrity, commitment, innovation, and customer trust. Fang says that these values, along with these crucial elements, are what have kept her there so long:
- Focus on the core business
- Long-term vision and strategy
- Treating customers as partners
- Building quality into all aspects.
"Integrity is a core value, and as a result, leadership values the legal department. These values are why I stay [at TSMC] and what makes it a great company," she says. "Working in-house allows me to know what the company really cares about."
Leading a Global Legal Department
In 2005, Fang received the "Deep & Far Award for Taiwan In-house Counsel" from Asialaw magazine. She became Associate General Counsel in February 2014, then became Vice President and General Counsel in August 2014. She works extensively with the company's board of directors, most closely with members of the audit and compensation committees. The legal organization comprises about 80 people, half of whom are lawyers and 15 of whom are technical experts, key to the company's efforts to protect its intellectual property. The staff hails from the United States, Germany, Greece, China and Japan as well as Taiwan; there are remote offices in Europe, Japan, China, and the United States. The company's new facility in Nanjing, China, will employ 1,200 people and will likely drive an increase in the size of legal operations in that country.
There are challenges to leading a global legal team, with operations around the world, lawyers from many countries, and varying jurisdictional cultures. Although English is not the first language for all department members, it is the common language with which they communicate. Cultural norms also can present challenges, Fang says: "Things that are acceptable in Taiwan, such as practices around employee termination, may not be acceptable in Europe. We must be very sensitive to local law and regulations.
"To foster a cohesive legal department, Fang schedules conference calls for early morning so that team members in the United States and Europe can participate. Even so, "it's always better when people can meet and talk in person," so she holds quarterly meetings in Taiwan that U.S. and European colleagues are asked to attend. The department also sponsors internal two-year rotations.
Despite the fact that semiconductor manufacturing is a traditionally male profession in Asia and around the world, Fang says she has never encountered any barriers due to her gender. The company walks the talk when it comes to diversity and inclusion: She is one of two women on the company's management committee (the other is the CFO). Of 16 corporate vice presidents, five are female; of Fang's five corporate direct reports, one is female. Fang notes that she is also one of the youngest company executives.
As to outside counsel, the TSMC legal department works with a select group of about 20 law firms. Selection criteria include shared values, expertise, and reputation for quality. "We value long-term relationships with firms that know TSMC and its business," Fang says. "But company growth also means encountering new issues, so we are engaging new counsel as well."
A Taiwanese Company with Roots in America
Fang describes TSMC as being more like an American company in terms of culture and management style than like an Asian one, probably due to the fact that many of the top managers trained in the United States. In fact, the chairman and founder, Morris Chang, worked at Texas Instruments for 25 years. Fang also trained in the United States, earning her master's degree in comparative law at the University of Iowa School of Law.
When asked whether dispute resolution differs materially in Asia from the United States, Fang notes that most of TSMC's litigation takes place in the U.S. "We are not a litigious company; we don't like to sue. But when we are engaged, we do fight vigorously in court"—guided again by its foundational value, integrity.
She has realized her goal to make an impact through her work. "I have an opportunity to have a direct impact on profitability, shareholder value, and profit sharing," she says. As an example, she cites TSMC's merger with two other companies about 15 years ago. "I made a change in one term of the contract that saved us US$2 billion," she says.
Fang's plans for 2016 include continuing to protect TSMC's substantial investment in research and development, which she estimates will exceed US$2 billion this year. "We must protect that investment and the freedom to operate," she says. As she works to enhance the company's patent portfolio, which includes 22,000 patents and is likely to grow by 10 percent in 2016, she is also seeking reduced cost and increased efficiency through prioritization about which patents to sell or not maintain. She also notes that challenges from non-practicing entities are significant; the company continues to build its strategy to combat them successfully. Returning once again to the integrity theme, she cites her final goal for the year as continuing to enhance TSMC's regulatory compliance efforts while minimizing risk.
As 2015 wound to a close, TSMC was ranked number 1 in the semiconductor manufacturing sector on the Institute of Electrical and Electronics Engineers (IEEE) Spectrum Patent Power Scorecard, an achievement of which Fang is obviously proud.
"It is a great accomplishment that demonstrates our strength and commitment," she says.
Of the move in-house to TSMC in 1995, she reflects: "The company was just beginning its phase of rapid growth. There was a lot I could do and learn; I think it was the right decision."
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