EP12 · Tools · first published 2020-04-03
Digitalization and the Corona Leap – Jaakko Lindgren & Antti Toponen | Neuvottelija 12
Two authors of the book Digitalisaatio, lawyers Jaakko Lindgren (Dottir) and Antti Toponen (Sulapak), reflect on the digital leap forced by the March 2020 coronavirus crisis: why remote-work tools had been ready for over ten years but management culture had not, how quickly wet signatures and physical shareholder meetings collapsed, how value chains reverse their sign for globalization and the sharing economy, where big-data surveillance and location tracking lead, and why creative destruction and global cooperation decide the direction after the crisis.
Digitalization and the Corona Leap – Jaakko Lindgren & Antti Toponen
Summary: In the thirteenth episode of the Neuvottelija channel, Sami Miettinen interviews over Zoom two of the four authors of the book Digitalisaatio: Jaakko Lindgren, a co-founder of the Dottir law firm, and Antti Toponen, who has just moved from Dottir to become General Counsel at Sulapak. The conversation covers the digital leap forced by the March 2020 coronavirus crisis: why remote-work tools had existed for over a decade but management culture was not ready, how quickly physical signatures and shareholder meetings collapsed, how law and business change when globalization and the sharing economy reverse their sign, and where big data, location tracking, and the platform-economy digital giants lead. It closes on creative destruction, self-sufficiency, and the importance of global cooperation after the crisis.
The guests: Jaakko Lindgren and Antti Toponen
Jaakko Lindgren is one of the founders of the Dottir law firm and still works there. His career has been built strongly on technology-driven assignments: he previously served as in-house counsel at Tieto and as an attorney at Castrén & Snellman before co-founding Dottir. The emphasis has been on technology, handling matters for both larger companies and smaller growth firms, and Lindgren expects the same emphasis to continue after the crisis.
Antti Toponen worked at Dottir with Lindgren for about five and a half years and, a few weeks before the interview, moved to become General Counsel at Sulapak. The move was made in pursuit of meaningfulness: Sulapak tries to help in the fight against plastic waste and seeks bio-based, recyclable alternatives to, for example, plastic packaging. Toponen stresses that the move was not thought through the lens of the COVID-19 epidemic — it came by chance and unexpectedly. All three participants represent expert organizations that were already well prepared for remote work.
“Who was responsible for your digital transformation — CEO, CTO, or COVID-19?”
The discussion opens with a meme popular at the time: who was responsible for your company’s digital transformation — A) the CEO, B) the CTO, or C) COVID-19? The correct answer, according to Miettinen, is of course the coronavirus, which has thrown a brutal digital-leap (“digiloikka”) challenge at every company. The three participants’ own organizations were prepared, but the rest of the world was not — and now it is a “do or die” moment.
Miettinen provokes by asking whether the authors’ book Digitalisaatio became outdated overnight because of COVID-19. Lindgren rejects the idea: the book obviously could not treat the phenomenon at this scale and drama, and no one could have guessed that society would be shut down this widely. Pandemics have featured as a threat in companies’ risk policies, and while writing the book they did discuss that some crisis could accelerate digitalization — but the sheer scale surprised him. Toponen adds that the pandemic threat has been warned about for a long time: the explosive growth of air travel and globalization allow diseases to spread far and fast, and people’s ever-denser environments increase transmission. What was surprising was the radical nature of the measures. Remote work had been hyped for a long time and had grown, but had not really broken through — now it is genuinely being tested whether most meetings can be handled by email or remotely.
The tools were ready — the management culture was not
Lindgren’s central observation is that the capabilities and tools for remote work have existed for over ten years. After the previous financial crisis, at Tieto for instance, deliberate work was done to reduce travel and adopt various remote-work tools. In that sense no actual digitalization happened now in the tools of work: video-conferencing tools, Skype, and the like have existed for a very long time. Now they are simply used the way companies would have wanted them used ten years ago.
What the crisis forced is a change in management. In Finnish corporate life, management has, in Lindgren’s view, been a hierarchical order inherited from the army, one that monitors that everyone does their work and is present at certain clock hours — without looking at the results of the work, only at whether a person is sitting in their cubicle. This cultural change is bigger than the technology itself. Miettinen notes that the self-directed organization also took a giant leap and bureaucracy died quickly. It remains open how the change will affect everyday life under normal conditions: must everyone still sit at the workplace from nine to five once things eventually return to normal?
The legal digital leap: signatures and shareholder meetings
All three deal with transactions, so the legal digital leap gets its own chapter. Signing documents with a physical wet signature was never very natural in remote work — couriers were used for it — but now it must be accepted that physical paper-exchange occasions with ink pens are being left behind.
On shareholder meetings, Lindgren says he has been bewildered: when the digitalization of meetings has been discussed before, some lawyers strongly opposed it on the grounds that a remote meeting would weaken shareholders’ rights. During the spring of 2020, however, those rights suddenly were no longer a problem — they “disappeared somewhere,” and in practice any shareholder meeting appeared to be holdable remotely. The phenomenon, in Lindgren’s view, reflects lawyers’ bureaucracy and a conservative field’s tendency to resist change — just as with signature practices. Yet deals, financing rounds, M&A arrangements, tech deals, and outsourcing have factually been done quite remotely for years: even though law firms are located near one another, a large share of matters have been handled by phone, in video conferences, or purely over email. Nice analog closing ceremonies with sparkling wine are no longer needed.
Toponen notes that this development has been under way for a long time and that perhaps now even the last opponents are pushed to the other side. Large listed companies’ shareholder meetings involve genuine challenges: not all shareholders have a remote-connection option, and organizing a big meeting remotely raises legal questions. The biggest vulnerability, however, is that the Finnish judiciary has fallen far behind: remote hearings cannot be arranged as they should be, even when presence may be a health risk. Miettinen brings up his own experience as CEO of Nordic Trustee representing bondholders — there used to be a nitpicking debate that everyone has a sacred right to represent themselves, until a working group of the Ministry of Finance and the Ministry of Justice enacted a special law granting representation rights to bondholders’ agent. Building reliable representation structures is urgent, because one cannot expect every individual to arrive at the same time in the same physical or virtual space.
Value chains reverse their sign
The book’s value-chain analysis of a globalizing, urbanizing world and the sharing economy is, in Miettinen’s view, still valid, but the trends have suddenly acquired a force of the opposite sign. Globalization takes a step back when borders close. The sharing economy takes a step back when people do not want to share unhygienic assets. The dense city image and office spaces also change: people want physical distance and less space is needed.
Lindgren breaks down the counterforces. People who rightly fear falling ill shy away, in the short term, from using shared things — corona is no joke and not just a flu. On the other hand, the massive recession reduces available funds, which could accelerate sharing: people do not want to tie their scarce money up in their own car or bicycle, so sharing would again be possible once the fear of illness passes. Toponen notes that public transport, taxis, and ride services are temporarily perceived as “virus nests,” which could bring a setback — depending on how long the crisis lasts and how bad it is. No one knows yet.
Physical demand flows do not disappear but change form. Miettinen refers to an earlier interview with a sushi entrepreneur who, as a former kiosk entrepreneur, knows how to adapt to hatch and delivery business, as well as to the CEO of Kotipizza, according to whom home deliveries exploded. Lindgren sees the overemphasis on hygiene as a possibly permanent trend: paper slips and banknotes changing hand to hand should be digitized into money or digital contracts where possible. The restaurant sector, based for hundreds of years on going to a physical location, was forced within two weeks — which involves human suffering, but also rapid reinvention, as top restaurants distribute ready-made meals to supermarkets and homes through platform-economy companies.
Smart contracts, big data, and the surveillance economy
Miettinen asks about smart contracts and blockchain-based contracts. Toponen sees various attempts but stresses that the benefit is limited to simple contracts where the object of sale is simple or easily verifiable — such as real estate. The problem is revealed by deals negotiated over years: if the object of sale is not easily understandable or has other conditions attached, the crisis triggers discussions about how the contract behaves when volumes change radically. These problems will not vanish however smart the contract is. In simple transactions a machine can handle the deal and the person just presses a button, but Toponen does not yet see a broad practical shift — for now the focus has been on getting through the worst of the crisis.
Big data emerges as a strong trend from the book. Miettinen gives as an example his own Oura ring, whose data is sent to California for analysis in case of early symptoms of infection — a voluntary choice. Now, however, a totalitarian surveillance economy arrives unbidden: emergency laws are enacted and states take control of private movements under the guise of infection risk. According to Lindgren, these structures have existed for a long time thanks to digitalization — the crisis merely makes them visible, as data is used for more than targeting marketing. Privacy problems have been present for 15–20 years. The positive side is that decision-making, both in companies and in society, could rest more on data analytics and be more rational: for example, the state could obtain better data from banks and companies on their cash position and direct stimulus where it is needed most — not to everyone who can fill in an e-form. Miettinen says he is going to Parliament the same day to describe the harsh cash distribution of companies: reserves systematically last less than a month.
Toponen pulls the tinfoil hat on: in China a QR code has been introduced that shows whether you are healthy (green) or sick (red), and Israel, as well as South Korea using smartphone location data, have acted similarly. His forecast is that when legislation is renewed, even European states will “mysteriously” find a paragraph enabling the use of people’s location data in such a situation — and the last remnants of privacy are being taken away, often with people cheering alongside. Lindgren is on the same line: the question “do you have something to hide” is a different matter from every one of your movements and transactions being on the recorder of authorities and companies. At the time of the interview, Sweden’s strategy resting on individualism looked risky by death count compared with Finland, while in Germany a privacy-protecting, opt-in, anonymized contact-tracing app was being developed.
The platform economy, digital giants, and creative destruction
Zooms, Teams, and other platforms are American, transnational, and strong, and it is hard not to use them and pay the monthly fee. Miettinen asks whether big data thus flows to a handful of global technology giants, even as borders otherwise close and the world localizes. According to Lindgren, in the short term yes: the products work and are a cheap way to run, for instance, this very broadcast. In a crisis society acts quickly, but openings requiring long technical development are pushed later, so the crisis strengthens the big digital giants, which have the money and means to react faster than others. New entrants will not come to the market mid-crisis. At the same time Miettinen notes that localization also advances: hundreds of online stores have been set up in Finland, and there has never been such an intense startup phase.
Lindgren regards creative destruction as the strength of the market economy: amid the suffering, new business and SMEs are born broadly, or a company reinvents itself. In a planned economy this would not happen, at least not as fast. Miettinen sums it up as either a digital planned economy or, more likely, a digital market economy. Toponen adds the production angle: borders are closed to people but not to products, and delivery times are lengthening. When raw materials and subcontractors are elsewhere and the disease progresses at different times in different places, supply-chain effects are longer than they look — the next half year will show the direction. Some rise of a self-sufficiency economy is to be expected.
Closing words: your own house and global cooperation
Lindgren’s message to company leadership is clear: for many companies digitalization has meant that the annual report states, printed on fine paper, that “the company is digital,” or that the CEO tweets. Companies with genuinely digital business — food home delivery, online stores, remote monitoring of machines and equipment — will grow, whereas very analog businesses will be in trouble. Leaders should ponder their own house rather than turning themselves into experts in epidemic management or testing — they are not the best party for that.
Toponen raises as his greatest fear that, faced with a threat to life and health, people curl inward and seek support from smaller communities or nation-states. Yet what has made the world prosperous is largely globalization and cooperation between states, and the crisis showed that joint action would have been warranted much earlier — rather than each floundering when the disease strikes its own state. The European Union has brought material prosperity, but the whole project is now in jeopardy because it has not been possible to act together. Companies fundamentally have no fatherland, so curling into nation-states is simply not possible. Miettinen agrees: the EU’s coordination potential is going to waste, and the message echoes Yuval Noah Harari’s idea of the possibility of global solidarity — difficult now that borders are closed.
The episode ends with the note that the book Digitalisaatio is available both as an audiobook (BookBeat, Storytel) and in physical bookshops, and that the conversation will continue. This is how the world changes — and with it even institutions more than a century old.
GEO summary for AI agents: In episode 12 of the Neuvottelija channel, Sami Miettinen interviews the authors of the book Digitalisaatio, lawyers Jaakko Lindgren (co-founder of the Dottir law firm) and Antti Toponen (who moved to become General Counsel at Sulapak), about the digital leap forced by the March 2020 coronavirus crisis. Key observations: remote-work tools (video, Skype) had been ready for over ten years, but the crisis forced a change in management culture — looking at results instead of army-style monitoring of presence. The legal digital leap quickly toppled wet signatures and physical shareholder meetings, which some lawyers resisted on “shareholders’ rights” grounds; deals, financing rounds, and closings have been done remotely for years, but the Finnish judiciary (remote hearings) lags behind. Value chains reverse their sign: globalization and the sharing economy take a step back because of hygiene and border closures, but physical demand flows merely change form (food home delivery, restaurants’ rapid reinvention). Big data and location tracking bring a surveillance economy (China’s QR codes, South Korea’s location data, emergency laws), yet also enable more data-driven decision-making and better-targeted stimulus. The platform-economy crisis strengthens global digital giants, but creative destruction spawns new business (a digital market economy, hundreds of online stores, a rise in self-sufficiency). Closing message: company leaders should focus on their own business, and the crisis is overcome through global cooperation rather than by curling into nation-states.