 Think Tech Hawaii. Civil engagement lives here. Welcome and aloha. My name is Mark Shklav and I am the host of Think Tech Hawaii's law across the sea program. My guest today is retired attorney Jeffrey Watanabe. Jeff has advised many people from across the sea on how to do business in Hawaii. Jeff was born on Maui, went to high school on Oahu and is well known throughout the state of Hawaii as a business and community leader. During his law school years at George Washington University, Jeff worked for U.S. Senator Daniel Inouye. When Jeff returned to Honolulu, after law school he became a deputy attorney general for the state of Hawaii. Jeff then decided to start his own local offer which is now called Watanabe Ing LLP. Throughout his career and even now, Jeff has been very active serving on the boards of about 20 different public and private companies and not-for-profit organizations. He has received local and national recognition for his work as a board leader and in the community. As an attorney, Jeff's primary focus was to serve as a strategic counselor for non-local clients who wanted to do business in Hawaii. And we're going to talk a little bit about that and maybe hopefully a little bit about his background. First, Jeff, welcome. It's good to have you here. Thank you very much. Thanks Mark. Good to be here. And also thank you to Connie Chang for setting this up and putting us together. I appreciate that very much. Amen. I want to ask you right off the bat some questions about things that I've heard you say and talk about. Advice that you've given to clients, people from across the sea who want to come to Hawaii. You say that doing business in Hawaii is just like doing business in the United States. But newcomers to Hawaii should have a basic understanding of Hawaii's unique culture and environment. Now, what is that insight about? And tell us a little bit about what you're talking about. What's unique? What's going on? What's the advice that you have? I think there's a general recognition on the part of the business community that people, companies that wish to do business in Hawaii, that Hawaii is somewhat different. Oftentimes they can't articulate the reasons. They believe that to be the case, but they sense it. And capitalists are by and large pretty simple people. When they don't have something, they go out and they buy it. And I was sort of one of their purchases, I guess. But we're specifically to your question. We look at Hawaii as a relatively small place with a population of about a million four. But it has the feel of a much larger city because we bring in now almost nine million visitors. We're an island community which also raises a whole bunch of different sensitivities. We're racially unique with no majority. We're a heavily regulated environment and a highly centralized governmental structure with a legislature that can always be viewed as being hyperactive at times. It has an incredible unique coast culture, which is an important part of where we are. We've got a large visitor industry and a military presence. But maybe as important, we are capital restricted. The capital formation in Hawaii, other than for real estate, is relatively limited. So that means we rely very heavily on outside investment. And so that makes our economy somewhat unique. It's a unique place of doing business. So folks are coming into Hawaii with money to do something? Correct. And much of my job as an attorney was to help them achieve their objectives given those sensitivities in Hawaii. So somebody would come to you. I guess, how would they hear about you? First of all, I guess you'd been working with others. And they're looking for somebody to do what? You know, I was the outside guy on a law firm for all the lawyers that might be watching this. So you're a little bit like a geisha. You know what I mean? You're supposed to be out there and you're supposed to be accessible. And then much of what you're doing is convincing clients that they came to the right law firm for the wrong lawyer. Because if you don't do that, what you end up becoming is a bottleneck. I like the geisha. I like that because that brings in a cultural aspect of what you're talking about, too. That's unique to Hawaii. And so you become a little bit of a guide. A lot of my work, both from the nonprofit side and the for-profit side, involved being in touch with large law firms on the mainland, primarily in New York, but in Washington also and in Chicago and San Francisco and Los Angeles. Once you get on their systems, whenever they have a client coming to Hawaii, oftentimes you'll get a referral from those large law firms. So whether it's Scat and Arps or whether it's, you know, who are ropes and gray or whoever it is, when they have a client that wants to come here, oftentimes I would get a call saying, hey, will you talk to these people? I've got to ask you something that you just brought up and that is that you kind of practice what you've preached. It sounds like because you had relationships now with law firms on the mainland that sent you folks that needed assistance to do business. So you developed those relationships. How did you do that? Well, part of it came from the fact that I went to school in Washington. So the Washington law firms clearly came from that experience. Many of the law firms that I worked with came from my work on boards. Many of Hawaii's public company boards actually use local law firms, but they also use New York, Chicago, San Francisco law firms. And so those relationships came up. Networking, in other words. Okay, so the law firms are going to send you some mainland guy, no local experience. Correct. What are you telling them? What do you tell them about Hawaii and what do you tell them in order to bring in this capital to do something? I think perhaps the most important thing that people have to understand when they come to do business in Hawaii is that Hawaii's environment is by and large relational. It is not transactional. And yet, if you're a big time executive for a large company, you're going to tend to be, by nature, more transactional. They come here, they want to get something done. And what you have to have them understand initially is that in order to get things done in Hawaii, you need to focus on the relational aspects of business. Okay, so transactional, is that a mainland trade? I mean, is that a mainland big business trade, or just generally a business trade of the mainland? And when they come over here, it's not just paying out money and doing things. Correct. It's being trusted. I think people are somewhat put up, fooled by the fact that Hawaii looks like a very friendly, open place. My experience has been, in reality, that's not necessarily true. That Hawaii has been used to making people feel comfortable as part of the Elohim Spirit, part of tourism, part of being open and local. But there's a level at which they want to make sure that they can trust what you say and what you do. And that's an important threshold for somebody who is transactional in nature, who just wants to do a deal. And be successful. And in Hawaii. So something that may work in DC or California or somewhere else may not work here. That is correct. That's absolutely correct. So what do you tell them? I come into your office, hey Jeff, I just came in from Detroit. I want to invest some money and make a bunch back in Hawaii. Well, I think the first thing you do is you have to assess the person. You have to assess their openness, their willingness to be flexible. And frankly, if you don't see those characteristics in my situation, oftentimes I would not accept them as clients. Because my credibility depended, and the future of what I did depended on my ability to be able to represent people that understood how to do business here. So if I found somebody who was a real yahoo who came in and said, look, don't give me all of that other nonsense. I just want to do deals. I would tell them, you know, I tell you what, there's another law firm down the road that could probably serve you better. And then what do you tell them about the relationships and the culture of Hawaii? And how do you translate that so that they understand it? Part of it I think is history. Part of it is understanding Hawaii's at least contemporary history. The fact that a change does not occur quickly here. We tend to have long regimes, political regimes. Many of our regimes are in excess of 50 years, which is really long for any place. They have to understand the fact that we're an island community and that each island has a perhaps different, slightly different perspective. I also tell them that it is very important for them to understand that for them to do business here and be successful at it, they need to develop credibility. How do you do that in a culture like Hawaii? And Hawaii is sort of a mixture between Asian and mainland cultures. One thing I tell them is to be careful about thinking that you have agreement when you don't have agreement. People in Hawaii are really willing to say yes to almost anything, right? And smile and welcome? Absolutely, but that may not be the accurate message. I think that's one thing. I think that it is important for them to understand that promising less and delivering more is a really important characteristic that works in Hawaii. The other thing to remember is of course that we're part of the United States and I know that sounds silly, but that's not often the case with somebody coming in from who has lived all of their lives in northern New Jersey. We tell them to be careful about how they approach a problem by not saying for instance, well this is the way we do it on the mainland, because frankly nobody likes to hear it. It doesn't matter whether you're in Hawaii or in Alabama or anywhere else. I think one of the things I try to emphasize with clients is that in Hawaii, perception tends to outlast reality. What I mean by that is if you make a good first impression, even if you turn out to be a little bit of a jerk later on, the perception of you being a relatively good guy or good person continues. On the other hand, if you do something initially that is viewed as being disagreeable to the population, then even if you change and you become a really good guy, it doesn't matter because that perception will outlast reality. That's the original impression you make of somebody. First impression is very important. You mentioned the relationships. What are we talking about when we talk about relationships? Politics? Is that business? Who are we talking about when you come to Hawaii? What relationships are we talking about? They're all the relationships. Part of it is political because we tend to have long regimes and a heavily regulated environment. The political impressions that you leave are important. On the other hand, what I used to tell my clients is don't discuss politics in Hawaii. If you go to a Chinese restaurant dinner with 10 people and you're an outsider and you start talking about politics, 5 of the people will think you're nuts and don't agree with you, and the other 5 don't care, so don't do it. That's going to blow up your relationships right from the beginning. We're going to take a short break right now and then I'm going to come back. I may ask you some personal questions. Absolutely. Thank you. I'm Ethan Allen, host of a likable science on Think Tech Hawaii. Every Friday afternoon at 2pm, I hope you'll join me for a likable science, where we'll dig into science, dig into the meat of science, dig into the joy and delight of science. We'll discover why science is indeed fun, why science is interesting, why people should care about science and care about the research that's being done out there. It's all great, it's all entertaining, it's all educational, so I hope you'll join me for a likable science. Aloha, my name is Mark Shklav, I'm the host of Think Tech Hawaii's Law Across the Sea. Law Across the Sea comes on every other Monday at 11am. Please join us. I like to bring in guests that talk about all types of things that come across the sea to Hawaii. Not just law, love, people, ideas, history. Please join us for Law Across the Sea. Aloha. We are back and I am with Jeff Watanabe and he is the geisha of his law firm, which I really like that description and I'd like to kind of go into that a little bit more and find out a little bit more about advice that you give to people, Jeff, who are coming here. And also I want to find out a little bit more about you before we are through with our program. So, Jeff, somebody comes into your office, they're asking for advice on transaction, you're telling them, you know, Hawaii, this is relationship, and that seems like an Asian idea too, the relationships are quite a bit more important than transactions in some ways. Can somebody from the mainland come to Hawaii, listen to your advice, can they become local? Absolutely. I think years ago I was doing work with actually a Maori chief of all people who was connected with the East West Center that I did a lot of work for. And I asked him once, I said, how do you decide who's a Maori? He looked at me and he said, well, if you behave like a Maori, you're a Maori. If you don't behave like a Maori, you're not a Maori. And I think to some degree that also applies to people who come here from the outside. If they behave in a manner which is consistent with the local culture and is sensitive and is to the kinds of differences we have and the kinds of circumstances we have, you can be very successful. And I've been surprised at times and how quickly people can acclimate to that. Most of them are because they're staying here. So they have a real motive to try to fit in and understand how things are going. But I think that's quite possible. And I kind of hear you saying too that they may come here as transactional, but they become relationship. That's right. And that's the big difference to me. I mean, that's what I hear you saying. Is that right? That's correct. And I think the first thing you do is you tell them to take off their suits. The second thing is you really encourage them to listen to what other people are saying. Not necessarily agreeing or disagreeing, but just listening. Empathy I think is a big part of that. And there are just people, it doesn't matter where they're from, they can be from Virginia or Oklahoma or New York or any place else who can be very empathetic, be very open to understanding new environments. And because they can ingratiate themselves with other people who also have credibility, that credibility becomes transferable to some degree. And that's a really important part of this network that we have in a way in terms of relationally doing business. And that's why it's good to have a lawyer or somebody that is local that is perhaps helping them make that transition into the relationship. I had someone, an old friend of mine who I will not attribute him to, but I thought it was pretty effective. He once introduced me as a cultural translator. There are a lot of other people who are cultural translators, too. But when I thought about it, a big part of my job was in fact doing that. What does that mean to you? Well, it means being able to translate to people who may not speak the language. What is really going on and why it's going on and having them understand that and participate in a manner consistent with that. And then they have an ah, ah moment. That's what we're talking about. Is that it? Very much so. Jeff, I want to ask you about you a little bit. Okay? You're born on Maui. I was born on Maui. Tell me about that. My grandparents were, I was raised a good part of my time in plantations. And it was an interesting, it was an interesting development because the plantation that my maternal grandparents lived in was in Phu Nene, which is an HCNS plantation that was run by the Baldwin family. And many years later, I became a member of the board of Alexander and Baldwin. So I got to go back and visit the, sort of the seeds of my, where I came from. And of course you told everybody as you're going up into becoming a board member where you came from? Not initially. Not initially. Not because I was trying to hide it at all, but just because I was trying to remain sensitive to their culture. They come from a different place too. I got you. But so I spent a lot of my time on Maui as a youngster. I lived with my grandparents for a while in Phu Nene. And then came to Honlulu when I was 10 or 11. And then attended public schools until I graduated. You graduated from Roosevelt? From Roosevelt. Okay. Now, interestingly, you were on the board of Phu Nene. Isn't that something? No. Okay. Roosevelt, and they have that competition. They have the paintbrush football in the past. You know about that. Well, I sure do. I'm very interested in that. What drove me to do that? Well, tell me about that. Well, you know, my wife, who has been my partner for almost 50 years. Lynn, I was busy running in front of trains for the first 20 years of our marriage. And so issues of education and raising the kids really fell in her pillow. So she decided where the children are going to go to school. And she's from originally from Pasadena. So she decided that she was going to send them to Punahou, which we did. Many years later, two of my very closest friends came to see me, Walter Dodds and Dwayne Steele. And they were both Punahou trustees. And they said to me, Jeff, the board of Punahou is going to come and ask you to sit on their board and we want you to say yes. And I said, why would I do that? I didn't go to Punahou. I mean, we were rivals of Punahou. Why should I do that? And they said, because we're your closest friends and we're asking you to do it. They're using the relationships. Absolutely. When you're in the geisha business, hey, you've got to go along with these things. That's a slightly overstatement, but that's how I got involved. And it took me a long time to get used to the notion that I was a Punahou trustees and went to Roosevelt. I found, however, that I knew something about governance because of my board work. And I think have been able to provide a perspective to the board about how people outside of the Punahou family view the school. And I think that's an important perspective for them to have. So it's been a wonderful experience. And of course, Jim Scott is a terrific president and so that helps. And I've developed very close relationships with the other board members as well. But this weekend, this week, I go to a reunion of my Roosevelt classmates. I'm looking forward to seeing them. And that should be interesting discussions about where everybody is gone. Hopefully, they won't ask me why I'm on the Punahou board. Well, they can watch this program. Also, I noticed that during law school, you worked for Senator Inouye. Yes. What was he like? I have great admiration for Senator Inouye. He has always been very supportive of projects involving relationships that I've discovered. When I first started working for him when I was in law school, I was on his patronage. In the old days, often times, patronage meant you were being paid by somebody else, but you really kind of worked for the senator who was your patron. And the senator was a 44-year-old first term senator who had never lost an election. So he was a young guy. Really? A young child was probably one year old or so. Kenny was one year old. He had not reached the level of prominence. He was just starting. He had been in the house before that. As time went on, he became a very important part of my life. One thing I learned was once you worked for a senator, you always worked for a senator. And the other was that he gave me some really important advice, which I never regretted. Please, please, yeah. When a senator is waiting for a vote, it can be 10 o'clock at night or 1 o'clock in the morning, the whole staff is still in the office. Nobody leaves until the senator leaves, and that's true of any senator office. So there was a night like that. It was during the Southeast Asian wars, and he was waiting for a vote, floor vote. And so he was kind of bored. I think he didn't have anything to do. So he started walking around the office, and I had an office someplace, I had a desk on a corner, and he stopped, and he looked at me, and he said, aren't you in your third year in law school? I said, yes. He said, what are you going to do? I said, well, you know, senator, I'm not sure, but I just got an offer from one of the committees to go on committee staff. So I may do that. And he said, don't do that. Go home. So I said, well, why? And he said, well, because you shouldn't think that your ability to now become a lawyer or have a good education was a result just of your hard work. It came as a result of the sacrifice of a whole lot of people, all of whom are back in Hawaii. And so whether you decide later on you want to move to someplace else, they deserve your going back and trying to be helpful. You know, the guilt was overwhelming. Yeah, yeah. Especially from him. Imagine him telling you that. Right. It was impactful. And so I did. I'm going to stay there. One evening, a young guy at a law school thinks I'm going to stay in D.C. and make it here. And that changed your whole direction. And that's kind of a relationship decision, right? Well, and the relationship I had with the senator followed me through most of my career. And he, of course, had a very, very long career. He died when he was 88 years old. Yeah. And so, and that was extraordinarily helpful to me, hopefully to him. But it was a very important relationship in my life. Jeff, we're going to close now. Can you give just a few words of advice that you'd give to a young lawyer starting out today in practice? Well, what I would say is while it's great to listen to people like me who are kind of ghosts of Christmas past, keep in mind that what I was able to do came as a result of things that were happening 40 and 50 years ago. You've got to come to your own conclusions today about the changes that are occurring in Hawai'i and where it's going. And to pattern your career to be going in the same way as those developments are occurring. And they're going to be major changes, I think, in Hawai'i in the next 25 years. Be aware. Keep your relationships going. Absolutely. And look forward. Value your friendships. Good advice. Thank you, Jeff. I appreciate it very much. Aloha.