Ashwath Rau on being one of ET’s Hottest Business Leaders under 40

ashwath rau

Ashwath Rau has made it to the Economic Times Hottest Business Leaders Under 40 list. He is pleased to receive the award and says, “It feels good to be recognized.”

A law graduate from the National Law School of India University, Bangalore, Ashwath Rau started his career at Amarchand Mangaldas in 1999. In 2006, he was made a partner at the firm. For Ashwath Rau, who has been involved in some of the biggest transactions in the country, making partner was simply a matter of time.

Recently, he left Cyril Amarchand Mangaldas to join AZB & Partners. It was a decision he made after 17 years at Amarchand; he joined the firm right out of campus in 1999, a decision he describes as a “turning point” in his life.

Yet, it was time to move on.

“It had gotten to a point where I felt that I wanted to try something else in my career.”

So what does it take to become a successful corporate lawyer?

Three things. One, hard work: there is absolutely no substitute for it. Some of the best corporate lawyers I’ve seen are basically very, very hard working. The second is diligence. Managing your time well translates into managing deliverables for your client. If you are not organised, you are less effective and less efficient. The third part is clarity of thought, which translates into clarity of communication, both written and spoken. It is a big tool while drafting documents or doing a good job for your client during negotiations.

And any specific skills that you require in order to become a better negotiator?

The most important thing is listening and understanding what the counter party is looking for, and ultimately not taking the negotiation as an adversarial process. The collaborative approach is a critical element for a transactional lawyer, as opposed to a litigating lawyer.

Mentor/Role Model

Julius Caesar. I guess the reason why I am inspired by him is the sheer versatility of the man; he was Rome’s greatest General, to some extent Rome’s greatest administrator and a great orator, an incredibly gifted person. By his own admission he was a very lucky man but he also said that he had to work very, very hard to get to the point where luck could come by and help. Hard work counts for 95% and luck will carry you for 5% of the way.

Advice to young lawyers entering law firms

The most important thing is keeping the faith, in terms of where they want to ultimately get to. Every lawyer who comes out of law school assumes law firms work like Boston Legal or Suits and do not realise the sheer hard work and long hours that are spent working.

I assume that people think through what kind of a firm they want to work with and it is a thought-through decision with which you must stay the course. It is important for a young lawyer to have this perspective.

You should know what you are looking to achieve as a lawyer, both in terms of content of what you do, and the value that you earn, that is the monetary benefits. Most people get very confused along the way about what they should be contributing to society at large. The assumption is that if you are not working for an NGO, you are not contributing to society, and I disagree with that.

For example, without infrastructure, how is this country going to progress? A lot of what we do is to bring billions of dollars into the infrastructure sector.

Law firms and retaining talent

I think it is ultimately about investing in people. If you treat those with you as expendable commodities who can be replaced in a marketplace, it is the wrong approach.

If I had to put down two reasons as to why I have managed to do well in my career, one part would be my family, particularly my wife and my daughters. They have been the emotional bedrock on which I have built my career.

The other part of it is my team. Those who have followed me to AZB, I cannot begin to describe the level of trust they had to repose in me. Moving to another firm was unknown territory for them. The people who have worked with me have been a big part of me getting to where I am.

The other part of it is how you share everything that comes out of the mutual association, whether it is monetary value, or value from a market reputation perspective. You also have to feel part of the organization that you are in. Today, for example, I would not be able to work as hard unless I felt AZB was my firm, as much as it is Zia’s firm. It is really up to the seniors to create that sense of shared ownership. If that is not there, you are not going to be able to retain or attract talent.

The churn in the law firm market post Amarchand Mangaldas split

The cost of lawyers is going up, and people are fighting for market share, not uniformly, but there are instances of irrationality. Basically, a high cost base, but undercutting vis-à-vis clients. But I still think that it is possibly a temporary phase and things will settle down. I don’t think we have seen the last of people switching from one law firm to another, particularly if the foreign law firms do come in.

As a legal industry, we will mature as the market matures. My sense is there is room for foreign firms to come in, and for several of the existing firms to continue to thrive and grow.

Thoughts on the entry of foreign firms

The quality of service that they will bring to this market is something that will be good for the market. SILF has been asking for a long time for the creation of a level-playing field. If you are going to be allowing liberalisation to happen, you cannot ignore the fact that Indian firms have been asking for a level playing field. Today, we can’t even have an LLP structure. For those of us who have our houses on the line, I can assure you it is important. There are restrictions to advertising and hindrances to fundraising. There are clear prohibitions on adopting alternative billing models.

At the end of the day, reform should necessarily have two parts to it. First, while making the market more competitive, it is incumbent on the regulator and the government to make sure there is a level playing field. Before they allow the foreign firms to start practicing Indian law, “directly” or “indirectly”, they should bring the reform in to make a level playing field. It is not my argument that you cannot allow them to come if there is no reform, but I also say that there is need for reform.