Sea Change in Chief Legal Role Requires Wave of New Competencies
The following was published on July 21 in ALM’s Corporate Counsel magazine. The demands on general counsels from their boards of directors and other stakeholders have grown in countless ways. While general counsel appreciate the rewards of their raised profile in the company, they also recognize the potential landmines. Corporate governance demands translate to more work, higher stakes and far greater finesse on the part of the general counsel.
Some general counsels are admirably meeting the new challenges, presented in a new study I compiled for the Global Counsel Leaders Circle: Sea Change: How New Corporate Governance Demand sare Elevating the General Counsel’s Job. One executive interviewed said, “General Counsels are expected to have a better understanding of the working of the Board, and play the role of both “man of affairs” and keeper of corporate conscience, not just technical lawyer.”
Unfortunately, many legal chiefs lack important skills needed for their evolving roles. Though many new competencies were not in their job descriptions before, general counsel must now gain abilities to keep up with new expectations.
John Stout, Chair of the ABA Committee on Corporate Governance and partner with Fredrikson & Byron in Minneapolis, said, “We should expect that boards of directors will be increasingly involved in selecting the company’s legal chief. Boards are increasingly aware of the need to have confidence in the legal chief’s judgment and skills, as well as his/her ability to effectively assist the Board in the discharge of its duties and responsibilities.”
Competencies for the General Counsel
In preparing the report, we asked legal chiefs and top executives they work with to name the key competencies for today’s general counsel role. We came up with this list:
Advocacy aptitude and experience
Business acumen
Calm temperament
Communications skills
Crisis management ability
Foresight and ability to identify trends
Independence
Integrity and good ethics
Judgment
Leadership competency
Legal knowhow
Management skills (including ability to involve and coordinate internal and external resources, as well as delegate)
Media awareness
Negotiation skills
Problem-solving ability
Some of these competencies are so-called “soft skills” that aren’t always learned with experience alone, and certainly aren’t taught academically. Nonetheless, they can be crucial to satisfactory performance. Many senior in-house counsel today will want to allocate time to round-out their skill set while on the job.
Many general counsel and their direct reports keep a close network of peers with whom they can discuss their challenges, approaches and seek advice or a fresh perspective. They may join roundtable groups such as the Global Counsel Leaders Circle. This can be a valuable aid, says one general counsel who explains, “Sometimes you don’t even know what you need to know. In talking with trusted peers, you learn about new issues to watch and prepare for.”
Communication skills, for example, are increasingly critical for the legal chief. Bill Mordan, General Counsel of Reckitt Benckiser, said,“General counsel must continue to distill complex risk and legal matters in concrete, cogent and concise language that directors can appreciate. This is more important than ever, because business, regulation and legal risk are more complex than ever, and directors cannot appreciate the connections and the challenges without clear explanations.”
Tom Sabatino, General Counsel of Walgreen, has held the chief legal role in a few industries ( including with Schering Plough and United Airline) and agrees with Mordan. Sabatino says, “Few board members are lawyers so you have to be careful not to use too much legal jargon. They want to understand the real world issues and get practical advice. If you try to impress them with your brilliant legal mind, they will feel either that you are trying to talk down to them or are hiding something behind the legal ‘mumbo jumbo.”
Sabatino believes that a primary skill for general counsels today is to act as a true business partner. “First and foremost, you need a strong sense of integrity and a good ethical compass to navigate what are often unchartered territories. The board recognizes pretty quickly whether the general counsel (or any senior manager) is being straight about issues or is trying to please directors,” he says.
The changing competencies required of corporate legal chiefs today cascade to all members of the legal and compliance department. Marco Reggiani, General Counsel of Snam, says, “Our entire legal function, including the compliance and corporate governance team, plays a major supporting role in my interactions with the board and other stakeholders. Every in-house lawyer today must reach far beyond strictly legal issues to understand, interpret and articulate the primary risks to the business, and help to reduce those risks.”
Each professional must therefore consider which skills need improvement and what competencies will be necessary in the future, and work with their managers to decide how to develop those abilities. Methods may include formal and informal training, on-the job learning opportunities and mentoring. In-house legal staff evaluations and feedback should address these competencies as well.
Given the sea change, the new wave of demand for super-competent general counsel will expect candidates to demonstrate their ability to weather storms skillfully, for the benefit of their employer. Prepare yourself now to catch that wave-- ahead of the storm.
This article, 2nd in a series, is drawn from the Global Counsel Leaders Circle Target Topic report provided at the link above.