The Strategic GC

Ideally, the role of the General Counsel is seen as a key strategic advisor to business teams across the organization, one that can help make decisions to guide growth and profitability while reducing risk. In practice, however, GCs are often saddled with the exact opposite reputation, being viewed as a hurdle or cost center that creates friction, while other departments (Finance, HR, IT) that absorb just as many resources and executive bandwidth somehow get a free pass. It follows then that, in order to viewed as an integral part of the executive decision-making process, a GC should prioritize building her reputation as a key strategic asset whose perspective improves outcomes and reflects positively on the business team.

One way to ensure success as a business leader is for the GC to build a strategic “roadmap” for the legal department that highlights the value in-house lawyers bring to the table and fosters partnerships with business leaders. Below are several battle-tested strategies that a GC can follow to demonstrate why business teams need a trusted legal voice to help anticipate issues and craft positive solutions.

1. Take Pro-Active Steps to Define the GC Role as a Strategic Partner
GCs and their teams contribute to the strategic and operational goals of the organization in countless ways, including helping to anticipate and avoid risky decisions that could be costly down the road. In many cases, however, those efforts and the ensuing benefits are largely invisible to the organization. The key, therefore, is highlighting these contributions to the business team so that they proactively involve legal at an early stage. The following are examples of the types of benefits that GCs can develop and discuss with executives to showcase the value they bring:

• Navigate Legal and Regulatory Compliance   
  GCs have the resources and ability to become the resident “expert” in helping organizations navigate complex and ever-shifting legal frameworks to ensure compliance with new laws, technologies, and a host of changing business realities. GCs that take the initiative on anticipating how these new issues impact the business (e.g. AI, data privacy) and collaborate on these efforts with the applicable business leader can demonstrate how much value the legal team can add.
  
• Strategies to Reduce Business Risk
  GCs can identify and manage all types of business risks that may not be apparent to the executive in charge of day-to-day operations and prevent major headaches down the road. For example, a manager may not anticipate how a too-short notice provision in a termination clause of a critical services contract could lead to chaos if the vendor suddenly pulled out. An experienced attorney has likely seen similar scenarios play out before and, unlike other executives, can explain the legal implications of these and other complex business concepts such as limitations of liability, indemnifications, and warranties and draft language that insulates against bad outcomes.
  
• Offer Transparent Insight Into Operations
  GCs have their fingers on the pulse of the organization’s operations and culture but are not necessarily reportable into those departments. GCs also have a bird’s eye view across multiple functions and departments and, therefore, can offer candid insights into developing issues and suggest resolutions. When included in strategic discussions, the unique perspectives of GCs often lay the groundwork for the policies and procedures that protect the organization and its employees.
  
• Be the Moral and Ethical Compass
  Leveraging a knowledge of legal analysis and professional ethics, the GC can play a central role in promoting ethical practices and identifying adverse behaviors.
  
• Lead During Crisis  
  In times of crisis (legal disputes, regulatory investigations, negative PR), the GC can effectively manage outside consultants and provide timely practical advice to help craft communications and guide behavior to reduce risk. In this way, GCs play a crucial role from the outset of a crisis, helping to reduce fall-out and facilitate a swift resolution.

When the legal function is clearly defined, the leadership team is better able to contextualize the work of a GC as not purely reactive, increasing the likelihood of the GC being viewed as a key strategic asset.   

2.  Build Communications That Support the GC’s Role as a Leader
Although the legal department serves multiple functions and departments within an organization, it is not always clear to the managers what the legal team is doing specifically to support their function. Maintaining clear channels of communication around legal activity, whether through meetings, email updates, or status reports, will help to underscore the GC’s value as a business partner. Consider the following examples of communications that can be generated by the legal department for this purpose:

• Employee Training and Education Sessions    
  Empower business colleagues to partner with you by demystifying confusing legal concepts. If in-person, organize lunches around topics that may be interesting or feature specific groups and how they are addressing new challenges (eg., data privacy laws, AI, remote work). Invite a colleague or outside counsel to provide guidance on a relevant topic and offer Q & A. These activities support the GC’s reputation as an expert that can help navigate new business territories rather than as a roadblock to getting things done. 
  
• Board Education 
  The Board is a major influencer within any company. By proactively raising topics applicable to the Board or making a brief presentation, GCs can enhance their reputation as a strategic executive. Topics might include new regulations impacting operations, new technologies, current challenges and how they are being met, or milestone events and what they mean for the company. If a presentation is not in the cards, circulate a memo or develop a newsletter format to keep them informed of legal developments and showcase legal’s accomplishments.
  
• Customer Service
  The in-house legal department serves many internal clients, and the quality and tenor of your interactions with these colleagues is probably the single most important communication of all. By consistently providing thoughtful, practical advice and being a good listener, the legal team can demonstrate to clients at every level that they care deeply about protecting their business unit (and the company as a whole) and are an indispensable business partner.

3. Manage the Squeaky Wheel
Every organization has tedious processes to be managed; however, legal departments are often unfairly defined by those that get the most negative attention. For example, companies in highly regulated industries may grapple with burdensome compliance or or costly litigation and although these are predictable business interactions, they are often viewed as legal’s “problems” and detract from the GC’s role as a positive business advisor. In almost all organizations, the legal team is responsible for reviewing contracts, a process that often casts the lawyer as a necessary evil and friction-generator rather than as a shrewd negotiator who can help improve the deal on the table. The strategic GC must therefore identify what legal processes are being scrutinized in her organization and pro-actively deflect potentially negative attention. Below are a few examples of how to shift perspectives:

• Develop Contract Playbooks and Templates
  As mentioned, negotiating contracts is almost always associated with delay. The GC can proactively deflect this reputation by creating templates, contract playbooks, or guidelines that outline the key terms and fallback positions for different types of contracts. Likewise, by explaining to business leaders how much time will be saved if the company’s forms are used in the first instance, legal is likely less to take the heat when things go off the rails. Finally, a GC might research and develop a contract management system that empowers executives to track the progress of their matters.
• Manage Budget Strategically
  Too often, legal department budgets are presented in an overly simplified way: the salaries of the team plus projected outside legal fees. During the budgeting process, GCs can take the opportunity to research innovative ways to reduce costs and friction and improve legal function, such as by outsourcing or automating certain functions. Even if ideas are not accepted immediately, keep offering solutions that illustrate that legal can be a strategic and effective partner.  
• Develop Positive Reporting Systems
  As noted above, although most executives are evaluated on established KPIs, legal is often judged by only one metric– cost. To overcome this dynamic, the strategic GC can develop her own key metrics for the department and build reporting systems that provide measurable data on legal’s performance and value. There are a variety of formats that help showcase the legal department and even identify it as a cost saver; Part 2 of this article addresses this topic in greater detail.

GCs are businesspeople first, yet, because the legal function is client-oriented and often reactive, GCs often neglect the importance of strategically managing their executive role and reputation. To be most effective within an organization, the GC must ensure that she is viewed not as a roadblock or cost center, but as an ally and a key partner in enabling revenue and driving strategic initiatives for the company. If you would like to discuss these strategies in greater detail, please contact Deborah Stehr at [email protected].

Deborah Stehr is a Partner with OGC and brings over 25 years of transactional and technology experience with a particular focus on the consumer goods industry, including digital services and e-commerce. Deborah has considerable experience in structuring both domestic and international arrangements for the manufacture, supply, distribution and sale of goods, as well as in protecting and monetizing brands and intellectual property throughout the product life cycle.