It’s a new world out there, and if you’re a General Counsel, you’d better be brave.
More and more, the GC is becoming a key, proactive player not just in legal matters – ensuring that the company operates legally and dealing out legal advice (personally or through staff and outside counsel) – but also in strategic business decisions and issues involving risk management, finance, marketing, human resources, production, sales, and more.
The scope is broadening as a result of developments in three major arenas that have made multinational companies more complex: regulation, globalization, and technology. As if that weren’t enough, the responsibilities are expanding as budget tightening continues to put the squeeze on resources.
For many GCs, the heightened complexity and volume of regulatory changes stands as the most formidable of the evolving general counsel challenges. Especially since the financial crisis that began in 2007, regulatory risk and compliance has grown in importance – including in the eyes of business leaders and board members, who have become more likely to be held accountable for compliance offenses. Moreover, the GC must ensure that good governance is being practiced at all levels, including within the subsidiaries of a corporation and even third-party vendors.
Managing legal issues in an increasingly regulatory-impacted environment – which tends to raise the cost of doing business – becomes more difficult when those restrictions put cost pressures on the very legal department charged with making the business compliant, and do its best to anticipate what might be around the corner.
The types of regulations affecting companies are changing too, as well as the kinds of disputes. Cross-border, multijurisdictional legal matters are now as commonplace as they are complicated. Many GCs must understand the political and cultural environment within each country and jurisdiction wherein their companies operate – some of which can be alarmingly dynamic. Sophisticated systems and processes are being developed and adopted to cope with some of these risks. But much of the challenge is learning the different mentality, business practices, sensitivities and perceptions at play alongside stringent foreign rules that might not always be clearly defined or consistently enforced.
The speed at which business operates continues to accelerate. Online global transactions, social media, and technological advancements have transformed the game: GCs have to be ready to act and respond immediately, companies face more scrutiny than ever (24 hours a day), and competition can pop up overnight.
Then there is the matter of cyber security – it’s not just an IT issue. The GC should be part of the discussion about policies, education, vigilance, and how the company might deal with a cyber attack. Furthermore, the legal impact of an actual data breach can be deep and wide, a communication plan deserving of careful legal consideration, and the legal steps for investigation and potential prosecution demanding.
In this environment, today’s successful GC must understand the business ramifications of legal actions (or inaction); be a trusted commercial advisor as well as legal advisor; be a gatekeeper, but not a roadblock, who is pragmatic, adding value by preserving value; and help the company understand the value in mitigating and controlling risk – without being too risk averse. The GC must be adept at coming up with creative (yet legal) ways to achieve business goals, but also hold firm when there is no such thing.
Beyond that, what can be seen as the next round of general counsel challenges? Succession planning, mentoring, determining what resources are needed, and attracting talent – in other words, preparing for the future and whatever it may hold.
BusyLamp Legal Operations software can help a General Counsel manage these challenges more effectively. Get a demo today.