“You need to be more commercial.”
These are amongst the worst words that can be said to an in-house lawyer. The whole point of being an in-house lawyer is that you are part of the business and are supposed to know the business. If you can’t be commercial, then what is the point of even having you?
What on earth does “being commercial” mean, though? It is a hard concept to grasp because it can mean more than one thing.
For starters, “being commercial” does not mean cutting corners on the legal advice, caving at the first sign of pressure, becoming a “yes man” or otherwise turning a blind eye to legal risks.
It also does not mean taking on the role of the commercial lead in a transaction. There is a clear difference between the commercial lead and the legal lead.
I have also found that when someone in the business says that you are being un-commercial, they often really mean something else.
Most often, what someone is really saying when they say you are being un-commercial is that “you are not listening to me”.
As an in-house lawyer, you need to listen very carefully to understand what the business really wants to achieve. Don’t take it for granted that you know the answer to that question. Ask, and ask again if you are still not sure, and then frame your legal advice around the answer to that question. Say it out loud, so people know that you know.
Other times, the business might be saying that you are not offering ideas or options for it to consider, only lists of rules and a bunch of risk warnings. Ideally, commercial legal advice should be “legal by design” i.e., framed as a solution to a business problem that appropriately manages the legal risks involved. This doesn’t mean taking the ultimate business decision, but it should involve an element of thinking through how your advice will work on the ground, in your organisation.
Even if your ideas are not the best ones, or the ones finally taken up by the business, there is a benefit in showing you are willing to put your thinking cap on. It shows you are part of the team. Even an idea that isn’t taken up initially might help the business open the door to another option.
Other times, the business might be saying “we don’t really know you very well, and we don’t quite trust that you understand us yet”.
One of the best solutions for that is time spent with people. If you are in an open plan office, sit next to non-lawyers, show them you are a normal person not some alien from head office who swoops in at the last minute, drops a bag of problems on people, and then wings it away until the next time a “sign-off” or approval is needed from legal. Occasionally, make a joke (bad ones preferably). Go on that charity bike ride or walk with the business. Donate when colleagues raise money for good causes. Join a diversity network. Get out of your legal box.
Always, always, always show people you are trying. People have assumptions about lawyers that don’t help us, and we need to combat that. Once people understand you are trying to do your best for the organisation, your reputation for being “commercial” will grow.
Finally, that usually just means that people now think you “get it”, whatever the “it” might happen to be in your organisation.
There’s a bit of an implicit assumption in this question that there is a tension between these two. It doesn’t necessarily have to be that case. We recently asked candidates for an internal promotion what they would do if they were struggling to get a senior stakeholder to accept their advice and one reflection we received was that either they hadn’t properly explained their thinking or they had missed a key aspect of the matter that was important to the client and needed to be acknowledged and factored into the advice.
That’s quite a good way to look at it. Commercial advice is still legal advice. It’s just more fully faceted. The balance lies in being curious enough about what your client is trying to achieve to be able to feel confident that all legal options have been explored.
Sometimes there is an irreducible legal risk and then it’s a question of working through the consequences to ensure the decision represents an informed and conscious one. The hope is always that it will only be in exceptionally rare cases that a client is prepared to wholly ignore a risk of serious legal consequences. The more investment there has been in the relationship with the clients to build trust and understanding, the less likely this is to happen.
The aim is advice that is accurate and useful. It’s hard to achieve the latter without the lawyer doing as much as possible to ensure they understand the commercial realities.
Rebecca Staheli - Head of Competition and Regulatory Law, BBC
Very few things can be seen as legal advice in isolation, there might be specific points but more often than not the challenge for an in-house lawyer is to blend the two, making it meaningful and solution-orientated. There is no hard and fast rule about the barrier, but you should always remember that the client / recipient of any advice is always the "company" and thinking about this should help when considering how to balance the legal and the commercial perspectives.
5 golden rules:
1. In house is not about abstract ideas or textbook law. It is about providing sustainable, supportive and understandable legal and business advice that helps the business to succeed in its short and long term. As a result, make sure that you properly understand the business - its drivers, priorities and risk appetite before giving either form of advice because you won’t be trusted for long if you don’t, and there will be nothing to balance!
2. Use the right language, form (voice, teams message, email, advice note) and timing for your advice to make sure that it lands well, will be understood, accepted and actioned willingly. Otherwise your advice will be ignored, and there will be nothing to balance!
3. Once you have been trusted to understand the business and be a usable and value-added contributor (by following points 1 and 2), then start to think about how you can distinguish explicitly between legal comments and commercial ones. For example, “taking my legal hat off and thinking commercially as a senior leader in the business, perhaps…”, or “MuSCo” i.e. “you Must do the following” (legal – law compliance); “you Should do the following” (legal – commercial terms and policies); “you Could do the following” (commercial). These statements will help you and your audience to understand when they have to pay attention. However, if you are good, they will simply want to. Unless you and they are clear about the distinction between the two then, regardless of whether your comment is legal or commercial, your advice will only be perceived as legal and not commercial advice, and there will be nothing to balance!
4. The “Commercial Communication C's”. Your commercial advice must be:
Concise;
Catalysing - your advice should motivate others to solve business problems - ideally with acknowledgment to you for your support, and doesn't result in the creation of a lot of work for you;
Carefully Considered - for maximum relevance and impact consider what to say, when, how, and to whom;
Commercially Contextualised - speak to commercial people practically and in their language i.e. profit, bonus, cost reduction, risk appetite compliance, sales increase, targets etc. Discuss their issues and the answers that they need;
Complimentary - endorse others ideas and roles. But, importantly, not Crowding out, Conflicting, making others look bad, treading on toes or stealing the limelight;
Cherished (an unusual word but used to make you remember it!) – whether your idea is useful, usable or just interesting, it should always be something that the recipients engage with and, so, are grateful to receive. Unless you are sure that it will be – don’t say it. You will say a lot less as a result, but often less is more and the less is more likely to be … cherished.
5. Be proactive, thoughtful and patient and don’t panic!
It is worth remembering that, for most colleagues “be more commercial” only means points 1 and 2 above. Mainly sticking to “MuS” and not doing the “Co” in point 3. In short, they are saying “please understand what I need and help me to do it, or to get as close as I legally can, quickly, simply, easily and in my own language, without complicating things or adding stuff that I haven’t asked for. I am busy enough already.” Do that well and you will be a good “commercial in-house lawyer”.
Moving onto the “Co”, is key to becoming General Counsel(lor) to the business and a great "commercial in-house lawyer". There is no set formula to finding the right balance - and it will vary constantly depending on what the business is doing – however by consistently following the approach set out above, you will reach the right balance, and it can be very satisfying when you do!
Balancing legal advice and commercial advice is something that lawyers grapple with on a day-to-day basis. Many come to this late in the day after excelling in their careers as experts, by focusing on key legal risks, issues and opportunities. Lawyers are trained to do this.
Whilst it is true an in-house lawyer's role is to give legal advice, you will be limiting yourself if this is all you do. You will also have well-informed views on other matters, so why keep them to yourself?
Many lawyers come back to a human centred way of thinking as they progress in their careers. Indeed, this sort of development is expected from all senior people in the business. What has worked well in early stages of a career doesn’t always get lawyers to the next stage. Lawyers still need to attend to the detail of legal risks and issues, but to get to the next stage, they often need to wear many hats and to think about the 'bigger picture'.
The role of an in-house lawyer is increasingly about managing legal risk and advising how the law impacts the business, as well as the 'black letter' law. To give high impact legal advice in-house, you will need a high degree of understanding of how the business operates in practice and to match this with your legal expertise.
I find a rhetorical question of 'so why should I care?' or 'so what?' helps. This can help you to keep in proportion the legal risks that you are advising on. Whilst a legal risk may have a high impact if it occurs, how likely that risk will actually occur? If the risk is not likely to occur or certain things need to happen for that risk to occur which can be managed, this is a key part of the picture and needs to be included to ensure that your advice has the highest impact.
If you have had the benefit of attending board meetings, you are likely to see other attendees expressing views on matters outside of their department. In my experience, board members value and expect this from their legal counsel too. This can be a key way of ensuring that legal advice is listened to as its value is clearly understood in relation to the wider organisational picture.
Solicitors are professionally regulated and have a duty to the court as well as to their employer, so there are always going to be matters that you will need to handle differently to your colleagues in other areas. However, where matters outside of legal risks and issues arise, it can be helpful to think about how you can help to progress those discussions to give more rounded advice.
You’ll have developed numerous transferable skills as an in-house lawyer. You will be used to thinking about opposing sides of an argument and listening effectively to another person's point of view. Lawyers are trained to identify salient points, consider weaknesses in their position and how the other side may respond, to bring matters to a conclusion.
Commercial considerations will often affect the legal advice as explained above but even where it does not, one way that I have seen work well in the past is sign posting when you are giving legal advice and when you are not. If you do this, it can help you to draw on your valued judgment to give more rounded advice as a trusted advisor. In-house counsel are often well placed to give rounded advice that does not exclude commercial considerations for high impact.
While I think you should always look at being commercial (and not unduly legally pedantic), the important principle is to do the right thing. You have a duty to your regulator and there are likely to be some forthcoming issues in the legal profession where lawyers may not have always acted as they should. So be practical but principled.
Ian White and Simon McCall - In-house legal consultants