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A recent survey of directors, board chairs and CEOs sheds new light on the role of general counsel in large corporations. The survey, conducted by the legal recruiting company Barker Gilmore and NYSE Governance Services, reached over 5,000 corporate leaders, though the response rate was not given.
It's filled with valuable insights into the minds of executive teams, who are increasingly looking at general counsel as a valuable part of corporate leadership. Here's some of the lessons in-house counsel can take away:
1. The GC Is Becoming Increasingly Important
GCs are now more likely than they were a decade ago to be viewed as key members of the executive team. According to the study, executives and board members expect general counsel to become leaders in the C-Suite. They look to GCs to add value through their unique legal perspectives and ability to manage expanding regulatory environments in the face of increased market competition. Directors turned to GCs most often for advice on compliance, risk analysis, document management and shareholder engagement.
2. Strategic Thinking Is Becoming More Significant
According to the survey, directors were most likely to look to GCs for pragmatic advice, but more than half also sought out GCs for a strategic perspective. The old view of the legal department as the in-house nay-sayer seems to be dying away, as well. Less than a third of directors viewed GCs as overly risk-averse "roadblocks to new ideas."
3. Most Companies Aren't Prepared for Succession
As the GC's importance increases, however, so does turnover -- something most companies aren't prepared for. Despite the fact that 86 percent of directors surveyed said it was somewhat important (56 percent) or very important (32 percent) to have a regularly reviewed GC succession plan in place, only 38 percent actually had one.
4. Internal Candidates Don't Have an Advantage
When the current GC moves on, internal candidates may not have a leg up on the competition. Only two percent of directors would only consider internal candidates, while eight percent would only look elsewhere. The remaining 90 percent of directors think internal GC candidates should be benchmarked against outside talent.
5. Take a CLE Course on Cybersecurity, Please!
Interestingly, the top brass was least likely to consult their legal department on cybersecurity or social media risks, despite the legal issues those areas implicate. They might have a reason to look elsewhere, though -- cybersecurity and social media were two of the top three areas in which directors wanted their GCs to gain more education and experience.