Unlike other executive positions, head of corporate law department plays the key role to the managerial hierarchy, which would be the most powerful person below CEO in some organizations.
It is commonplace that head of corporate legal department has different names, which is interchangeable, General Counsel, Legal Director, Chief Legal Officer. The general counsel in a corporate law department is the bridge between top management and the department. The higher he or she is placed in the organization, the greater the prestige, authority and effectiveness of the department. The general counsel should be involved in key decisions and fully engaged with the company’s activities.
The general counsel may be either more lawyer or more manager, depending on the size of the company and its law department. In smaller companies and departments, the general counsel remains primarily a legal practitioner. Depending on available resources, he or she typically handles general legal matters and supervises outside counsel on matters requiring extensive legal activity or those requiring particular expertise that is not available in-house.
Scope of Duties
- Generally, the duties consist of managing the department and controlling costs, supervising or directing all of the company’s legal affairs and activities, implementing departmental procedures and policies, and developing and monitoring a cadre of trained lawyers and support personnel.
- The general counsel should reserve the right to report directly to the company’s board of directors and CEO on significant legal issues and the operation of the law department (assuming there is no direct reporting relationship to the CEO). He or she cannot function effectively without a sound rapport with the board.
- The general counsel may spend a great deal of time on non-legal functions. For instance, the general counsel may be called upon to supervise corporate secretarial functions, governmental and public affairs, human resources, real estate or insurance, or other staff departments. At the request of the CEO, the general counsel may serve on numerous committees and assist with ad hoc task forces.
How to establish the relationship with the board or the senior executives
When working with the board or the senior executives, the general counsel frequently wears two hats, the legal advisor and the business advisor. These roles may overlap, serious issues of inapplicability of attorney-client privilege can arise. Thus, the general counsel must be sensitive to the delicate balance of serving as a legal and business advisor to the senior executives and members of the board.
- While a board needs to be treated as one unit, the general counsel should pay close attention to the personalities and business perspectives of the various members;
- Learning what, when and how an executive wants information and advice is the key to developing a meaningful relationship;
- As there is a potential conflict between senior management and the board members, general counsel must be guided by the understanding that the corporation, not individual executives, is the client.
Maintaining a relationship of trust with the board results from hard work and professionalism. The essential ingredients for maintaining strong relationships with sophisticated board members are well-prepared board packets, crisp presentation materials, and participation at appropriate spots with concise and insightful advice.
How to thrive on future challenges
To tackle future challenges of in-house legal departments, the General Counsel look at the following strategies to prepare for the future and cope with more or less challenge (as described in Tomorrow’s Lawyers, Richard Susskind):
- The first one is to focus mainly on outside lawyer to reduce legal costs;
- Reshape in-house department instead of running large in-house department;
- Review internal and external capabilities and try to streamline both;
- Undertake a comprehensive legal need analysis for the business between traditional lawyers and new legal service providers; and
- Building competent in-house functions by tentatively appoint a new position chief operating officer and improving performance of coordinating lawyers.