Pragmatic Interpretation By External Counsel And Law Firms Most Important To GCs: Santosh B. Parab
Ashima: Mr Parab, what are some of the biggest challenges you face as a General Councel in today's global legal climate?
Santosh Parab: Amid pursuit of better, quicker, innovative product launch race in the finance sector of our emerging ‘super economy’, concerned bouts of geopolitical instances and increasing regulatory complexity, as a GC rethinking of adaptability of approach towards models and structures is required. This needs uninhibited and spontaneous dealing of legal challenges on all sides to help manage the implications.
Maintaining a balance in dealing with complexity of structures and urgency of business requirements is, I may say, not the biggest challenge but the ‘biggest necessity’ of the legal climate. Terms like ‘support’, ‘control’ defining the legal role alone is thing of the past. Legal climate's biggest challenge, I believe, is not just 'doing', but ‘exceling’ in enabling business within blurring lines of directions.
Capability building aside, a compelling challenge here is also dealing with capacity requirements of processes and procedures. Another marathon that comes to mind is working on swift feet in light of propping incident awareness and stringent regulatory oversight. This calls for and demands intensifying pressure on in-house legal departments to transform their operating models furthering ways of boosting performances.
Ashima: As a General Counsel, what are some specific actions or support you wish to receive from law firms/external counsel to better assist you in your role?
Santosh Parab: The first that comes to mind is Practicality. The most important thing GC would require and expect from external counsel/ law firm is a pragmatic interpretation. “Law debates” may be an interesting read. However, it must be appreciated that business enabling support is expected. The implications, of source should be well dwelt upon, deliberated and tailored for a specific organization and sector. Within a sector too, support is expected after thorough understanding of business, peer practices and scale of numbers. Monitoring, liasioning and production support are few of the things where law firms with their army of lawyers come as productive choice in bigger transactions.
Ashima: In the finance industry, what are some of the upcoming regulatory changes that will impact organizational compliance or business operations?
Santosh Parab: Scale Based Regulations in 2022 marked a unique and ‘Scaled’ path of regulatory changes in the NBFC sector. The set of RBI circulars that now stand consolidated as Master Directions introduced further mandated governance and policy requirements, capital requirements and called out management responsibilities elaborately.
The Information Technology governance, risk and control master directions microscopically lays out the security and technology processes, wider engagement of committees and compliances of reviews. This subserved and complimented the IT outsourcing management guidelines with plethora of monitoring directions.
Of course, the DPDP regime for which Digital Lending Guidelines is already a torch bearer in the BFSI sector. The First Loss Guarantee thresholds, compliances under the First Loss Default Guarantee guidelines amalgamates compliances and business practices at structural level.
Enhanced escalation facility requirements for complaints resolution with Customer Protection Committee requirements of Internal Ombudsman circular, KYC directions on V-CIP (Verified Customer Identification Program) and non-face-to-face customer diligence and re-defining penal charges in fair practice requirements are some of the intricate regulatory changes that need prudent attention by NBFCs.
KYC directions on V-CIP, non-face-to-face customer diligence and redefining penal charges in fair practice requirements are some of the intricate regulatory changes that need prudent attention by NBFCs.
Ashima: Looking ahead to 2024, what legal developments are top of mind for you and why?
Santosh Parab: The most important one is Data Privacy. The regulations under Digital Personal Data Act are yet to be notified by the Government of India. It would be interesting to see how corporates which deal with the huge amount of personal data manage all the compliances including taking proper consent from the data provider. Close behind digitalization of the legal ecosystem is also directions on governance framework for fairness and transparency through disclosure requirements.
Ashima: Let’s turn the wheel of time, what sparked your interest in law and drew you to the role of a general counsel (in-house counsel)?
Santosh Parab: Like things which happen by chance, my journey towards interest in law and then to the role of in-house legal officer and then a general counsel was not planned and happened by chance. I belonged to lower-middle class family and born and brought up in a mill and chawl localities of Parel (the old Parel-Lalbaugh area). The primary aim post my XIIth exam was to provide some monetary support (to the extent possible) to my parents.
In those days, I was not the only one but you ask anyone from that time, they would have worked for supporting their families while pursuing higher education. I started working as a typist and clerk for small proprietors (who were into electric panel and fabrication works) in industrial galas in Andheri and nearby areas post attending my 2-3 morning lectures till 9 a.m. at Khalsa College in Matunga and completed my B. Com. degree. The experience working in the small firms was enriching as I was required to do everything right from typing, managing petty purchases, sales invoices, shopfloor staff, bank related work, etc.
Post my B.Com., I wanted to study further and therefore joined a night Law College (Jitendra Chauvan College of Law, Vile Parle). It was my mother’s dream that her children should be highly educated and for that she had picked up few fights with my relatives. In those days law was not taken very seriously and people used to join law college just to get one more degree without much efforts. I also thought on the same lines and while working in Stores & Purchase Department in a Glass Factory in Andheri, I completed my Law degree from Mumbai University where I was also a rank holder.
This Law degree changed my life. God kept sending people to help me to get into the legal field. Some of the notable people were, my boss in a Glass Factory (who allowed me to work in morning shift alongwith the shop floor workers between 7am and 3pm so that I can attend classes at the law college in the evening), the Directors of that Glass Factory (who were very happy with the news of my selection as Legal Officer at IDBI and relieving me with a days’ notice), my first few managers (at IDBI where I joined as Staff Officer, Grade A post after clearing the All-India Level Test), the Chief General Manager – Legal and Executive Director at IDBI. I am also grateful to all my good seniors at IDFC and my current organization who have helped me reach the position of in-house counsel and take up the role of the General Counsel.
Ashima: Who are some of these seniors, legal professionals you admire, and why? What lessons have you learned from them?
Santosh Parab: There is a list of many legal professional whom I admire and they have helped me in shaping my legal career. To list down the names of each one of them would be difficult, but I am thankful to all my Seniors with whom I worked at IDBI immediately after clearing the Law Exam. The first five years in IDBI were enriching. The lessons which I got there were enumerable and invaluable. I would like to mention few examples here which includes, the proper way of drafting the documents, typing the same (there were no desktops/ laptops at that time), the details of carrying out the research on a particular matter (which was done, manually after going through law books and AIRs, etc. – no internet/Google services were available), each and every aspect of Project Financing – from documentation, to preparing title reports and then recovery. I would also like to mention the names of few legal professionals whom I admire. For example, Zia Mody (AZB & Partners), Former Chief Justice of India, Shri Uday Lalit, Shardul Shroff, Cyril Shroff for their legal knowledge and expertise and putting Indian Law firms in the list of top global Law Firms & Practioners.
Ashima: What are your hobbies or passions outside of your legal work? How do they help you unwind and recharge?
Santosh Parab: My hobbies are gyming (I like weight training though not able to build enough muscles), walking, listening to devotional bhajans, spending time with my small daughter and teaching her harmonium. These are the times when I forget all other things and I feel fresh and energetic.
Ashima: If you could leave our readers with one actionable piece of advice to advance their career or personal growth, what would it be?
Santosh Parab: There is no substitute for hard work. Read, Read and Read is a mantra for any one who is aspiring to become a Legal Practitioners, whether inhouse or otherwise. Keeping oneself updated about latest developments (both on legal and economic front), keeping abreast about the latest innovation in technology field (aiding legal work) are few of the key points. I believe, going into minute details of the issue is necessary before giving any legal advice or drafting any document. One should take a practical view and be an enabler rather than a blocker by giving solutions to the issues albeit keeping everything within the purview of law and compliance. Nowadays, there is zero tolerance to non-compliances and those who breache law and regulatory compliances have to pay a heavy price and sometimes have to lose “License to Operate”.
Going into minute details of the issue is necessary before giving any legal advice or drafting any document.
Santosh Parab: Disclaimer: Views expressed are my own and do not necessarily reflect the views or position of L&T Finance Holdings Ltd. and are not attributable to the Company.
