In two of my past jobs as an in-house counsel, I was the first lawyer to ever be employed by the company.
In the first job, at a small digital-imaging provider, the executive ranks consisted of career sales representatives and software engineers. Sales reps and engineers are not the kind of people who appreciate lawyers. But my theory as to why the company decided to hire an in-house counsel is that the two partners who owned the company had each been through divorces and, through that experience, had learned the value of good legal representation. I sincerely mean that. Eventually, my role in the company became one of giving advice on all sorts of matters, and I oversaw the development of business proposals for winning the company’s largest contracts.
In the second job, I was hired by the CEO and sole owner of a fast-growing government contractor inside the Capital Beltway. During the company’s early years, other companies had walked over the CEO in the business sense (they had reneged on subcontracting out work and hired away employees). So it was with great pleasure that the CEO would call me into his office to fire off a demand letter against this company or file a bid protest against that company. The CEO’s wife was a lawyer, which I think helped drive his decision to hire me. The CEO was also very patriotic and wanted to deliver quality services to the U.S. government, making companywide compliance with regulations and government contract clauses a large part of my job.
Companies see a need for a general counsel for personal reasons as much as for business reasons. Many companies automatically create a general counsel position when they incorporate. Even in those companies, the general counsel’s role is ultimately shaped by how the CEO, CFO, VP’s of sales and HR, etc., personally relate to lawyers, and how they view the role of lawyers in business. It was once said that all politics are local. In the same way, all general counsel are personal.
Some businesspeople fear that introducing a lawyer into the company will do as much (or more) harm than good. The realities of today’s business and regulatory environment are forcing companies to look beyond those fears, however. Having a general counsel on the executive leadership team is becoming a necessity. Increasing government oversight is placing not just more legal responsibilities on companies, but quasi-legal ones as well. Issues far removed from traditional legal practice, such as data privacy and enterprise risk management, end up on the general counsel’s desk simply because there isn’t anyone else equipped to deal with them. In addition, general counsel are now being drawn deeper into the public policy realm; some even head up their company’s political action committees.
There is no textbook definition or instruction manual for what the job of a corporate general counsel should be. I don’t think there ever will be. Any given general counsel’s job is unique. It is a mosaic created by reconciling the development of effective working relationships with fellow executives with the duty to serve the corporate entity (including the board of directors), the duty to follow professional ethics rules, acceptance of responsibilities for new quasi-legal corporate functions, and the limits of what the general counsel sees as his expertise.
The following is a taxonomy of what I consider to be the seven basic types of corporate general counsel (the taxonomy applies equally to any level of in-house counsel). No one type is better than the other. More than one type may apply.
Which type describes you? If you don’t see your type listed, I invite you to post a comment to the column describing how you classify yourself.
1. Pinstripe: These types of GCs see their relationships to their companies more as attorney-client than as employer-employee. They draw a line between business and legal concerns and give purely legal advice. They deliver legal support reactively, in response to individual requests and as problems arise. Essentially, they are traditional lawyers placed within company settings, and they often come from law firms where they served clients as de facto in-house counsel. Pinstripes fit company cultures that do not want or value integration of the legal function into operations or business decision making.
2. Cop on the Beat: These types of GCs emphasize company compliance with laws, regulations and policies from the boardroom down to the operational level. They rely on documenting company policies and following policies to the letter in providing legal support. They maintain productive but authoritative relationships with other executives. They are willing to say no to business proposals regardless of the dollar value stakeholders, but they are not necessarily whistleblowers. Cops on the Beat fit company cultures with tight management controls.
3. Permissive Parent: These GCs routinely and vigorously inform management of legal and other associated risks in business proposals, but in the end they are wholly deferential to business decisions. They rely on identifying, analyzing and reporting risks, e.g., risk ratings for contracts. They never say no, and they generally do not play an active role in final decision making. Permissive Parents fit aggressive business cultures that acknowledge the need for legal review but have little tolerance for opposition to moving forward with business initiatives.
4. Consigliere: These GCs play key roles in all major company decisions, including highly sensitive areas such as executive compensation. They rely on business data such as industry benchmarking as much as on legal opinions in giving advice. They maintain close relationships with the CEO and other C-level executives, and they are perceived as part of their companies’ “inner circles.” They can be vulnerable to accusations of unethical or illegal behavior. Consiglieres transcend the lines between personal and professional relationships between a lawyer and the business.
5. Technocrat: These types of GCs focus mostly on corporate governance and the optimization of legal support through processes and automation, e.g., negotiation playbooks, self-help legal support intranet sites, mature reporting and compliance programs. They do not heavily rely on close relationships with other executives, and they are often active members of the Association of Corporate Counsel (ACC) and other legal industry groups. Technocrats fit company cultures that value operational efficiency, e.g., lean manufacturing.
6. Big Game Hunter: These GCs use legal expertise in specified practice areas (e.g., intellectual property, antitrust, tax) to add to the company bottom line or to enhance competitive positions. They view their jobs not so much as providing legal support as producing revenues through legal work, e.g., favorable court awards and agency rulings, mergers and acquisitions, large deals, tax savings, etc. Big Game Hunters fit opportunistic company cultures with flexible business models.
7. Fixer: These types of GCs utilize negotiation and mediation skills to facilitate agreement, both among stakeholders within their companies and with customers, suppliers and partners. They apply company policies in a manner that allows for compromise. They are open to taking on quasi-legal corporate responsibilities, and they often fix company organizational and operational problems on an informal, ad hoc basis. They rely on personal traits such as patience and common sense as much as on legal opinion in providing support. Fixers fit corporate cultures with loose management structures.
I have fit the description of each of these types of in-house counsel at different times over the course of my career, working for a number of companies of different sizes and with different ownership and management structures.
I have played the role of the Cop on the Beat when faced with rogue middle managers who ignored corporate policies. I have been a Pinstripe in dysfunctional circumstances when I believed it was necessary to draw a distinction between my job responsibilities and those of others. I have been a Permissive Parent when circumstances called for supporting momentum for a company initiative. I am not a Fixer by nature, yet I have found that a Fixer can be a very valuable role in a company. Never underestimate the value of being a Fixer, even if it isn’t what you went to law school for. I am, I have discovered over the years, an excellent Technocrat, and at times I have had to reign in my Technocrat-icity in companies that valued personal relationships more. Being a Consigliere has made me uncomfortable unless I genuinely liked and respected the CEO and the rest of the inner circle. Being a Big Game Hunter is fun, but it is hard work, and at times it has left me feeling like I was not being compensated enough.