HSBC law chief Richard Bennett explains why his team thinks local and avoids empire-building. Michelle Madsen reports

Soaring up over Docklands and boasting one of the best views in London, HSBC's glittering City headquarters are not what you would immediately imagine when thinking of your local bank.

Nonetheless, as general counsel Richard Bennett is quick to point put, with more than 9,500 branches in 82 countries, HSBC still likes to style itself as the closest bank to you wherever you go in the world.

Bennett joined the institution 28 years ago from Stephenson Harwood when the legal team was a mere three-strong group based in HSBC's headquarters in Hong Kong. Since then he has seen the function blossom to its current size of 650 lawyers worldwide, one of the world's largest legal teams.

Unlike next-door neighbour Barclays, however, the imposing tower at Canada Square does not house a three-figure legal team but is instead home to a modest team of 30 lawyers looking after the corporate, investment banking and markets side of the business.

This, Bennett explains, was not always the case: "When HSBC took over Midland Bank in 1992 we inherited seven different legal departments around the country. We turned this into one department."

Recent months have seen the bank's legal function in the UK undergo something of a transformation. The restructuring was prompted by Michael Geoghegan's appointment as chief executive last year, which has also seen a wider boardroom shake-up with the appointment of two non-executive directors within the past seven months.

In the past, Bennett explains, the UK legal function at HSBC ran on different lines from its international counterparts.

Partly inherited from Midland and partly devised by his predecessor, Chalmers Carr, up until last year HSBC's UK legal function operated as a single cost centre with Bennett at the helm.

This model contrasted significantly with the way that HSBC's legal departments in 40 countries across the rest of the globe were run.

The head of each national department reports to their regional legal boss in one of Asia (Hong Kong), North America (New York), Latin America (Sao Paulo/Curitiba), the Middle East (Dubai) or Europe (London).

Last year's realignment of teams saw the UK department split into three, with Keith Ford, Andrew Jackson and Richard Hennity heading up the commercial banking, corporate banking and general headquarters teams respectively. The changes to HSBC's legal function have placed the teams closer to the bank's product lines and will, Bennett says, make for a more efficient system.

"This new model, with three sections supporting different business areas, has changed the general counsel's relationships with the head of businesses at HSBC in the UK. Previously, as one legal department we were seen by the business as a cost centre over which they had no control. Now they can decide how much they want to spend on in-house legal resources."

The reshuffle has changed the dynamic of Bennett's role, giving him more contact with the bank's executive; though he does not sit on the board, he regularly attends board meetings. Likewise, the team will now operate more closely with HSBC's business.

"The legal department should not just be a helpline," he argues. "That creates huge rifts. If you can get your in-house lawyers to be treated more like trusted advisers, they will get used constantly."

The concept of shifting legal departments from an overarching support group towards embedded teams within separate business lines, is one which has developed significantly since Bennett went in house.

"The perception of the in-house lawyer is changing and moving closer to the US approach," says Bennett. "This model will emerge in the UK eventually."

Bennett made the move back to the UK in 1993 after the Hong Kong and Shanghai Bank acquired Midland and went on to open more than 1,500 branches throughout England and Wales. Rapid growth in the UK has been mirrored internationally with such acquisitions as the US credit finance company Household International in 2002.

The bank has also invested heavily beyond its retail banking roots in an attempt to build a larger presence in the corporate lending and investment banking arena.

"Once you get to a certain size, you cannot do everything. One of my principal roles is to link the sector with legal departments outside the UK," Bennett says. "I have to be fairly hands-off but I do get to roll my sleeves up and do a bit of drafting. I think, 'Yippee! I can go back to being a lawyer.'"

One aspect of his role that has not changed is Bennett's hand in choosing the bank's outside counsel, although he explains that under the new structure his three UK deputies will have an active part in the process. HSBC's current UK panel comprises Addleshaw Goddard, CMS Cameron McKenna, Denton Wilde Sapte, DLA Piper, Eversheds and Slaughter and May. However, Bennett is sceptical about the benefits of running rigorous scheduled reviews.

Bennett says the bank has not yet decided whether to go ahead this year with a formal review of the current line-up, which was put in place in late 2004. Whatever the decision, it is clear that HSBC is not one of the growing band of banks, of which Barclays is the most obvious example, that puts its store in highly formulistic panel reviews.

"I do not believe that buying legal services is like buying paper clips. If you cut costs too much, you become a loss-leader," he says.

Neither is he an advocate of the global general counsel who dictates which law firms his regional department heads go to for outside counsel.

"All of the 40 countries that have their own legal department are domestic entities," he says. "The senior lawyer reports to the senior business man and everyone has relative autonomy."

Although Bennett sees himself as the connection between all of HSBC's regional legal departments across the globe, he is sceptical about the need for carving out time for constant face-to-face meetings with his regional legal heads across the globe: the jet-set culture that sees many of his counterparts at other global businesses spend plenty of time on a plane is not the HSBC way of operating.

"I visit the main legal centres around the world about once a year – it is not in our culture to waste money," he says.

"Anyway," he adds, "my role as general counsel is different every day. An awful lot of what I do is done using my grey hair and experience."