Alumni Q&A: Where Are They Now? Joseph Chan, Shanghai Alumnus

Joseph Chan is the Chief Legal Officer of Yum China Holdings, Inc., a Fortune 500 company listed on the New York Stock Exchange after its spinoff from Yum! Brands in November 2016. Yum China has exclusive rights in mainland China to KFC, Pizza Hut and Taco Bell, and owns the Little Sheep, East Dawning and COFFii & JOY concepts outright. With 9,200 restaurants in over 1,300 cities at the end of 2019, Yum China is China’s largest restaurant company. Joseph is also an alumnus of Sidley’s office in Shanghai. Lei Li of Sidley’s Shanghai and Beijing offices recently sat down with Joseph to catch up on his current role, how he remains connected to former Sidley colleagues, and China’s booming restaurant industry.

Can you describe your role at Yum China and what makes it compelling?

Joseph: “As chief legal officer, I oversee all the legal, regulatory and compliance functions and affairs at Yum China, which has become an independent company with its own shareholder base. From a legal standpoint, I was drawn to this challenging opportunity because of the specific skillset that was required, including solid knowledge of U.S. corporate securities laws and the regulatory landscape in China. Concurrently, I lead the growth aspect from the legal side while working with our corporate finance and strategy departments to execute growth initiatives. But it is actually surprising how little I directly handle legal matters. What makes my role so engaging is the fact that I deal with a lot of leadership, talent management, business operations and strategy. It almost feels like I’ve started a new career.”

The Chinese restaurant industry has experienced an explosion of innovation and technology – how has your business innovated to adapt with advanced technology?

Joseph: “Our mission is to become the most innovative restaurant pioneer in the world, so innovation and digitalization are front-and-center in all our discussions. Our menu is AI-enabled and we have online digital membership of over 240 million people. Our supply chain and restaurant management are also becoming fully digitalized in order to increase operating efficiency and maintain food safety. Big data is a very important resource and opportunity to us, and therefore so is Intellectual Property, which is a core function of our legal department. Given the heavy emphasis on innovation, we have a significant portion of our marketing, IT and new retail teams that are dedicated to digitalization and all things pertaining to e-commerce and the cyber space. In fact, I thought I had joined a tech company rather than a food and beverage business, since many of my colleagues on the senior management team come from IT and tech background.”

What types of working relationships do you maintain with international law firms, specifically Sidley?

Joseph: “Sidley is our go-to firm and adviser for public reporting, corporate securities and governance. We work very closely with the Chicago and Hong Kong offices, and I think there is opportunity for growth in our relationship as we continue to seek opportunities for expansion both within and outside China.”

What advice would you give to your Sidley friends who are looking for opportunities to represent companies like yours, both in and out of China?

Joseph: “We expect our outside counsel to be responsive, to really know our business, and to proactively anticipate issues and needs. Efficient delivery of legal services with high quality and accuracy is also crucial. I think it is very important to reiterate that all service providers should, to the maximum extent possible, spend time with us to learn about us and know us.”

Lastly, how have you been able to leverage your external counsel’s perspective and years of legal practice at a business like Yum China?

Joseph: “Business people want the bottom line – what is the practical implication if we adopt a position that was recommended from the legal side. So it really does force me to be more pragmatic and business-oriented while delivering legal services. Even more so than when I was in private practice. We must always appreciate where the business folks are coming from, and what their considerations are.”

Published March 2020

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