What drew you to the derivatives industry?
Prior to the financial crisis, I was a legal counsel for Managed Funds Association. One of the association's most important initiatives was focused on OTC derivatives documentation. I had very little exposure to OTC derivatives, but worked with my outside counsel in advancing MFA members’ interests. Through my work, I developed a better understanding of the products and their benefits and uses. In the wake of the financial crisis, Congress began to consider various pieces of legislation for the regulation of OTC derivatives. On behalf of MFA’s members, I engaged in advocacy around what ultimately would become Title VII of the Dodd-Frank Act. This advocacy is what really sparked an interest in me to focus my practice on derivatives regulation. I left MFA around the time Congress passed the Dodd-Frank Act, and my first day of work at the Commodity Futures Trading Commission was the day President Obama signed the legislation into law.
Who have been your role models and the most influential people in your career?
Over the course of my legal career, I have had three. The first person is my uncle, who is a tax attorney. He first encouraged me to practice law and focus on issues related to business and financial markets.
The second is Lauren Teigland-Hunt, who was my outside derivatives counsel when I worked at MFA. I was inspired by her depth of knowledge and ability to persuasively negotiate on behalf of the hedge fund industry on documentation matters within ISDA working groups. She was also very kind and patient with me in explaining some of the complexities and concerns related to OTC derivatives trading.
The third influential person is one of my former bosses at the CFTC, then-Commissioner Scott O'Malia. He hired me to act as his counsel and policy advisor at a time when few African-Americans had opportunities to take on prominent positions within the agency. Before working for him, I was charged with writing a number of rulemakings for the Commission. After interacting with his office many times, he took a chance in hiring me to work for him. He had one of the most diverse Commissioners’ offices and championed racial and gender diversity by providing advancement opportunities.
How have things changed in terms of diversity and inclusion since you started working?
I cannot say that things have changed very much, unfortunately. Since I started working in the legal industry and then specifically in the derivatives industry, I have not seen much change. Aside from Commissioner O’Malia, former Commissioner Sharon Bowen and more recently Commissioner Rostin Behnam, to my knowledge, no other CFTC commissioners have hired persons of color, let alone Black people, to work in senior staff roles. This reality is also true outside of the CFTC, both in-house and at large law firms.
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What do you see as the biggest barriers to Black and ethnic minority professionals growing into leadership roles?
Like Mr. O’Malia, senior leaders who identify bright persons of color in the industry should be willing to give them an opportunity and mentor them. I think it is important for these leaders to actively provide these opportunities notwithstanding that these persons do not look like them and may not have the same cultural background. I feel fortunate for the opportunities that I was given at the Commission and since then.
Tell us one thing you hope for future generations.
I hope people within the majority at the CFTC and at large financial institutions become allies; that they take meaningful steps to help change this unfortunate dynamic. It is my hope that one day soon more Black and other persons of color are provided with opportunities to work in senior roles at the CFTC, in-house at derivatives firms and at large law firms.
Carl Kennedy is a Partner at Katten Muchin Rosenman. Prior to working at Katten, Kennedy was a senior in-house counsel at a large investment bank, where he offered support on legal and regulatory matters to the bank's macro markets and clearing businesses and advised on implementing global derivatives regulatory reforms, including regulations that were published under Title VII of Dodd-Frank. Kennedy also worked as counsel at the U.S. Commodities Futures Trading Commission in the Office of the General Counsel and then as special counsel and policy advisor to Commissioner Scott O’Malia. Before that, he worked as an attorney at Managed Funds Association.
