BarkerGilmore LLC - June 2, 2020
A new report by Chief Executive Group and BarkerGilmore found that the majority of CEOs (84%) have their General Counsel on the executive management team while data shows that private companies lag behind at only 57%.This is not the only difference in how CEOs use their GCs at private versus public companies. For instance, outside of legal oversight, CEOs at public and private companies have their General Counsel manage differing capabilities at varying rates. Private company GCs are more likely to oversee risk management (81%), compliance & ethics (50%), human resources (42%), and government relations (35%); compared to public company GCs overseeing compliance & ethics (84%), government relations (49%), risk management (44%), and privacy (31%).
CEOs shared that their General Counsel add the most value by offering risk analysis expertise and acting as their adviser. At both public and private companies, CEOs believe the top three ways General Counsel make the greatest impact to their teams are litigation/investigation management, risk management, and crisis management. However, not all GCs rise to their CEO’s expectations. Seventy percent of CEOs say their ideal General Counsel acts as a strategic business partner and as a valued member of the leadership team, but only fifty-five percent say their sitting GC currently does. CEOs want their General Counsel to be more strategically involved, with only 8% indicating that their ideal GC would act solely as a legal counselor and manager of legal risk, but 25% assessing their current GC this way.
In addition, as CEOs look to the future, many are not prepared for their current General Counsel’s departure. Overall, more than half (58%) of CEOs have not identified a potential successor to their current GC — a finding which seems to be correlated to the company’s revenue size. As company revenue decreases, so does the CEOs belief that a successor exists. Forty-five percent of CEOs at $1 billion + companies cite no successor compared to 95% at $100-$249.9 million. Private companies are less likely (75%) to have a potential successor in place.
Download and read more insights from The Role and Value of Today’s Modern General Counsel from the CEO Perspective, a report by Chief Executive Group and BarkerGilmore.