Changing job titlesLeaders of in-house legal teams are increasingly known under a range of different job titles, from the more traditional Head of Legal to the now common General Counsel, together with Legal Director and Chief Legal Officer where this blends in better with other C-suite job titles.
In organisations with larger legal teams there may be an overall Group General Counsel with a reporting group of General Counsel or Assistant General Counsel denoted by region of specialism (or both) – e.g., General Counsel, EMEA region or General Counsel, M&A.
Another factor has been the widening of the scope of some GC roles – for example, General Counsel and Company Secretary or Director of Corporate Affairs and General Counsel.
Does the job title matter?Whilst there may be an obvious pull to ensure that similar level jobs in organisation have similar titles or prefixes (e.g., Senior Vice President General Counsel), what really matters is the purpose and scope of the role, which should naturally be reflected in the job title. Also important is where the role sits in the management decision-making process, working through the legal team and the GC’s relationship with the board. In this article we consider each of these in turn.
The purpose and scope of the General Counsel roleWhether a GC is the organisation’s first GC or is taking over in an existing role, it’s important to quickly establish the purpose and scope of the role. Whilst, it may appear obvious – to give legal advice, manage the legal function and cut legal spend, for example, in reality there may be less clarity and consensus than at first appears.
This is because, particularly for first GCs, the reasons for hiring them may be linked entirely to a particular commercial need, such as cutting legal spend by drafting and dealing with contracts in-house rather than outsourcing that work.
There’s nothing wrong with this, of course, but the consequence may be that the GC is pigeon-holed and struggles to gain a foothold in other areas of the organisation’s business which would benefit from their expertise – say in relation to compliance, governance or other commercial areas.
And even in established legal teams, the GC can find that there are different expectations amongst senior management and the board about where they should focus their attention and resources.
The point, however, is that it is very much part of the GC’s role to quickly establish and articulate the key objectives and priorities of the legal team and to set out a strategy for meeting these.
This inevitably includes understanding the objectives and priorities of the board and senior management with a view to determining how the GC can best support these. It also requires the GC to set out what the legal team should be focused on and the resources needed given that the GC is also concerned with matters extending to risk and governance.
Strategic planning and influencing
Any new GC will need to engage with some important tasks. Here are some examples: -
- Mapping the key areas of legal risk in the organisation’s business
- Comparing the legal team’s activity and the focus of its advice with the key risks and priorities of the organisation and key clients to establish where there is alignment and, particularly, gaps
- Assessing resources and skills to identify gaps and shortages
- Articulating what the legal team should be doing to best support the organisation’s objectives, protect its interests and deliver an effective service and setting out a strategy and business plan explaining how it will do this, including how resources will be deployed and developed.
This can be a challenge for the GC on at least two fronts. First, time and focus. The GC will have a full in-tray of business as usual, including requests for urgent advice and dealing with issues relating to management and delivery. The challenge is in making the space in their busy schedule to focus on strategic thinking and planning.
Second, particularly for newer GCs or those without previous experience in these areas, it’s all very well realising that you need to plan but where do you start? A good place to start is by talking to, and observing, other senior managers in the organisation so as to learn from them. If there’s an established budget and planning cycle and process, you’ll be able to plug into this, which will help the GC to focus on organisational priorities. There’s also the legal team itself, which will be a source of useful information on where changes could be made. Finally, there’s external input and guidance from peer groups and experts, much of which may be freely available. And don’t forget about mentors – inside and outside the organisation.
There’s also the situation where a new GC may find that they are not responsible for all legal advice given to the organisation – for example, where a business area outsources legal work without involving the GC at all. Indeed, there may be a reluctance to allow the GC to ‘interfere’ in long-standing local arrangements. In a sense, this goes to the heart of the GC’s role and purpose as the organisation’s chief lawyer. For them to carry out this role effectively, they do need to be accountable for the legal advice given to the organisation and not only where advice is asked for. To tackle a reluctance to involve the GC and the legal team, the GC will therefore need to be active in strategic influencing as well as strategic planning.
Working through the legal team
Most GCs will have a team of lawyers (and perhaps others). It’s true for any leadership role, but the GC needs to work with and through their team as that is how they will be most effective. This makes the GC responsible for the building and development of the team and for the quality of its output. This is a topic in itself, but the GC will want to ensure that the recruitment procedures support the recruitment of the best people possible and that they have a system to support the learning and development of people and the overall team.
Ensuring high quality legal advice and a high-quality service to the organisation is vital, of course, as it won’t work to provide an outstanding service in one area but fall short of needs and expectations in others. This also includes ensuring the quality of the service from external providers.
For those GCs who are sole lawyers in their organisations, they will want to focus on developing really strong relationships within their organisation together with the quality of the external advisers they use and in having a strong network of support where they can share ideas and learn from others ways that supports their own development and well-being.
What CEOs and Boards want from their General Counsel?
Today’s GC is expected to have well developed and broad business and people acumen and skills and be able to provide strategic advice that not only reacts to current challenges but is also able to look ahead and help the organisation plan its future development.
This enhanced role for the GC is only possible where the GC has demonstrated their competence in the ‘basics’ of the role and have earned the trust of CEOs, senior management colleagues and the board. Building on this trust, the GC then has an opportunity to demonstrate their value not just as a lawyer, but also as a business partner and strategic adviser.
Getting the basics right means giving legal advice that is accurate, timely and relevant (in the context of the organisation and its legal and regulatory framework, its ethical standards and tolerance for risk).
So, what do CEOs and Boards typically want from their GC? Here are some baseline requirements: -
- Relationships and collaboration. This means primarily with the CEO and the Board but also someone who has good working relationships across the organisation.
- Trust. This means, of course, honesty, reliability and discretion but also trust that the GC will speak out against popular ideas or group-think where they think an action or decision is legally and/or ethically wrong.
- Risk and compliance. The GC must be across the risk profile of the organisation and they are able to explain the key legal risks and work to manage them, including by helping colleagues in the organisation to set an appropriate tolerance to different risks.
- Governance and oversight. The GC needs to be influential in working for good governance in the organisation and in supporting good relationships with regulators and oversight bodies.
- Deep organisational and sectoral knowledge. A GC cannot be a business partner or strategic adviser without an excellent knowledge of the organisation and its sector.
- Broad business and personal skills. The GC is a legal expert but they also need good working knowledge of other business disciplines in the organisation. Other skills most prized will certainly include: -
- Service delivery
- Solutions-focused problem solving
- Resilience and calmness under pressure
- Organisational overview and forward-thinking. The GC can add great value from their perspective of seeing problems and issues arise across the organisation and flagging these early.
- Thinking ahead. The GC’s value is not just in dealing with issues in the here and now but in also horizon-scanning and future-proofing to look for potential risks and opportunities.
GCs on the Board?
As GCs have become more high profile in organisations, there is a debate about whether they should be a member of the board of their organisation.
What are the advantages of the GC being a member of the board? Clearly, membership means that the GC has a seat at the table and must be involved in all board decision making relevant to the organisation. Membership will help the GC build a relationship with the chair and non-executives perhaps in a way that may be more difficult otherwise. The proximity of the GC to the board will ensure that the board has ready access to legal advice and it gives the GC the opportunity to raise issues of concern easily and directly. Some might argue that this should provide for better governance and decision-making.
With these advantages, what then are the arguments against the GC being a member of the board? The principal one, is that this produces a conflict of professional interest. The board is the GCs ultimate client and, if the GC is a member of the board, they could be in the position of giving legal advice to themselves! This should result in the GC having to recuse themselves from board decisions where the GC has provided legal advice – which may well happen often. The GCs membership of the board essentially compromises their ability to act as an independent adviser to the board and results in a conflict of interests for the GC.
If the GC is not a member of the board, should they be engaged with the board? The answer to this is an unequivocal YES. Here are some practical ways in which this can happen: -
- The GC attends board meetings (as a non-voting attendee), or at least those meetings where legal advice or legal issues are under consideration. Often the board will not be concerned with deciding legal issues per se (they’ll often have been resolved earlier) but there may be specific issues of policy or strategy that the GC should be helping with by advising on legal risk and opportunities.
- The GC sees board papers.
- The GC provides a regular report(s) to the board. This could be on specific issues (say, as part of a corporate pack) to which the GC can speak, as required, at the meeting.
- The GC is part of the board culture of the organisation and is able to build relationships with the chair and non-executive members. This could include attending strategy, away-day, type events.
- The GC has a dotted line to a non-executive. This may be more controversial but is advocated as a way of ensuring that the GC can raise issues of concern in a recognised structure.
- The GC is actively involved in executive committees.