Randal Barker, head of legal for the iron ore business of BHP Billiton, talks to Adam Majeed about the legal and strategic challenges in his role, the shift to disputes work, and environmental vulnerabilities
Can you tell us me little bit about your company and its objectives?
BHP Billiton is one of the largest mining companies in the world. We aim to own and operate large, high-quality, low-cost, expandable, upstream assets diversified by commodity, geography and market. We look at tier one long-life assets and commodities such as iron ore, copper, petroleum and coal.
How big is your legal team in Australia?
There are approximately 30 lawyers in Australia. I’m the general counsel of our iron ore business and have a team of 10 lawyers. There are also teams in Brisbane (headquarters of our coal business) and in Melbourne (corporate office). The general counsels of each of the businesses (also including our Copper and Petroleum businesses based in Santiago and Houston respectively) as well as the general counsel of our corporate legal team, chief compliance officer and chief operating officer all report to our chief legal counsel based in Melbourne.
Can you describe your role at the company?
I’m the general counsel of our iron ore business based in Perth and a member of the executive committee chaired by the iron ore business president, which runs the iron ore business. I’m also a member of the legal executive committee chaired by the chief legal counsel, which runs the legal function for BHP Billiton. My role is to manage a team of lawyers who provide legal counsel and support to the Iron Ore business.
How long have you been working in the mining industry? Was it always in iron ore?
No. I’ve been in mining since 2008. Initially I was at ENRC [Eurasian Natural Resources Corporation] as general counsel and company secretary, based in London. I joined BHP Billiton in 2011. Prior to joining our iron ore business and moving to Perth in 2013, I was the company’s senior executive in Europe as head of the London office. I also had responsibility for the legal teams supporting the non-Australian mining businesses and for the specialist competition and anti-corruption lawyers.
Did you time in private practice before? If so, why did you move in-house?
Yes. I spent 10 years in private practice in Vancouver, Tokyo and London. I was at Lovells in London where I worked in cross-border M&A and international equity capital markets. I felt that my role was becoming more and more specialised in IPOs and I was curious about business strategy, so I moved in-house.
You were in London for quite some time before moving to Australia. How has your role evolved?
Before I had more of an oversight role in a corporate office; now I’m general counsel of the most significant division in this global mining company.
What motivated you to move to Australia?
The quality of the role as general counsel and the opportunity for my family and I to spend some time living in Australia.
How do you see your practice developing in the short to mid-term?
My own practice will be more focused on Australian law and regulatory developments, with an emphasis on dispute resolution and competition.
What projects are you working on at the moment?
A lot of my own work is strategic and not project-based. The business is multi-faceted and requires legal advice across a wide range of areas.
Last year the world's biggest miners showed resilience but there is speculation that big boys will begin to suffer this year. Do you agree?
I think it all depends on particular commodities and specific circumstances.
How has the downturn affected your role?
There’s a lot more focus on what value you add to the business, a focus on what we as lawyers are actually doing to help our internal clients be more productive. For example, the Legal function has focused on restructuring and simplifying its leadership and organisation to deliver better performance. And to this effect we’ve developed a protocol to ensure that core work is undertaken internally; we’ve developed a five year plan and a people plan; and we’ve embedded a team of non-lawyers within the legal function to facilitate continuous analysis and improvement. Essentially, there’s been a lot of focus on productivity improvement and simplifying business procedures. It’s not routine legal advice work, you have to add value more widely.
BHP Billiton Iron Ore says it is committed to working with its local communities to support sustainable development and look after their needs. How is the company going about this?
We have a significant community investment program. We source locally when it’s competitive to do so, and there’s an important focus on diversity, including with indigenous people.
What challenges do you face in your role?
You need to be prepared to deal with external events. For example, the collapse of a tailings dam in Brazil operated by Samarco [a joint venture company jointly owned by BHP Billiton and Vale] has raised environmental and other legal issues that we’re working through as a wider legal team.
What proportion of your work do you outsource?
It’s difficult to fix a percentage, but we do more insourcing than we used to in line with our protocol to ensure that core work is undertaken internally. We’d rather provide better support for our business and do the work ourselves.
When do you outsource work?
It depends on the nature of the work (core or not), how specialised it is and the amount of resources required. For example, we typically outsource the heavy-lifting for large litigations and focus on adding value internally by providing strategic direction.
Which law firms do you use?
From my business, we have established relationships with Ashurst, Herbert Smith Freehills, King & Wood Mallesons and Clifford Chance.
What qualities do you look for in external counsel?
Expertise, service orientation, competitive rates and local presence (in Perth).
Do you prefer fixed or hourly rates?
It depends on the matter. We try to fix fees to the extent that’s possible to provide certainty.
Finally, do you think 2016 is going to be a difficult year for iron ore?
Market commentators predict that it will be a challenging year ahead.
Vice president legal - iron ore
Randal Barker has been vice president of the legal team for the iron ore business of BHP Billiton since December 2013. He is a member of the legal executive committee and the iron ore executive committee of BHP.
Previously, Randal was BHP’s senior executive in Europe as head of the London office. He also had responsibility for the legal teams supporting the non-Australian mining businesses and for the specialist competition and anti-corruption lawyers.
Earlier in his career, Randal worked in law firms in Vancouver (Bull, Housser & Tupper), Tokyo (Anderson Mori) and London (Lovells) as an M&A and capital markets lawyer, and in-house as the general counsel of a GE Capital business in Europe and as the general counsel and company secretary of two FTSE100 companies headquartered in London (Resolution and ENRC). W
Randal is an alumnus of Harvard, and is admitted to practise law in Australia, the UK, Canada and the US.