BarkerGilmore Senior Advisor Ann Harlan (Former Vice President, General Counsel and Corporate Secretary, The J.M. Smucker Company) talks with two former CEOs, Jenniffer Deckard and Kevin McMullen, to share insights on specific skills and traits that CEOs look for and value in a General Counsel as a trusted business partner.
Creating an effective and trusting business relationship with your CEO goes beyond the well-honed legal skills that you worked so hard to develop. In fact, what it takes is similar to how you build a meaningful relationship with anyone, whether a colleague, spouse, or a friend. To be successful, focus on enhancing your ability to:
Understanding expectations from the CEO’s vantage point, and how you as a new GC and member of the executive team can fulfill those expectations, is vital to creating a successful relationship.
Board members rely on trust in the GC as an individual as well as in the partnership between the GC and the CEO. This trust must extend not only to the GC’s character and expertise, but to how they manage processes and relationships within the organization. The GC must work to establish trust with the board, allowing them to concentrate on other matters, confident in the knowledge that the GC is working hard to protect the interests of the organization.
Acknowledging that we all have blind spots, there are some pitfalls that a GC might unintentionally fall into if not prepared. These may include:
Be a bold and no-nonsense general counsel who is willing to bring the tough topics to the CEO. Be willing to raise the flag on tough issues and challenge both the team and the CEO. Gaining credibility with the entire leadership team will also strengthen your position. Do your homework, gather input from across the organization, effectively evaluate the situation, and you will continue to build the CEO’s confidence in you over time.
Attendees submitted questions to our distinguished panel and their answers provide additional insights and a variety of useable and practical tips to help you develop a more effective working relationship with your CEO.
It is not unusual for members of an executive team to have different opinions about how best to address an issue or to execute on strategy. Those differences often lead to better outcomes and it is important to air those differences in the context of a management meeting. It is also important to present one unified vision to the board absent major issues. It is only those times when the GC believes that the course of action taken puts the company at risk of breaking a law or running afoul of a regulation or another obligation where the GC has a difficult decision to make. At the end of the day, the GC has a legal and ethical obligation to voice concerns, but, in reality, those situations are rare.
Our view is that it is possible, and important, to come across as both. To be viewed as a leader as part of an executive business team is critical, and to carve out a role as a trusted legal advisor is also critical. The two are not mutually exclusive. The best GCs do both naturally.
A successful GC will build trust on the front end so that when there is an issue, the HR team will naturally come to the appropriate legal professional as a resource to help resolve issues. HR matters should be a natural place for a GC to be viewed as a partner rather than an “after-the-fact report.” This doesn’t mean that HR has to consult someone in the legal department on every matter but rather that there is a trusting relationship.
The biggest areas of focus will depend on what type of business you are joining, the management style, etc. A manufacturing company with large long-term contracts will be very different than a software company with hundreds of licensing arrangements. A company that often resorts to litigation to resolve issues will require a very different focus than a business that is hesitant to engage in litigation. Areas of focus will be driven by additional factors of management style, regulatory pressures, and even the financial condition of the company. The best analysis of where to focus energy will come both from the senior leadership team, a review of past legal activities, and general information gleaned from “managing by walking around.”
Maintaining the privilege can be tricky for General Counsel. This is an area where outside counsel may be helpful depending on the circumstances.
No more so than any other issue. It will depend on the situation, the facts as they emerge, and the skills and expertise of inside counsel.
A new CEO will be evaluating their team as well as learning the business, company culture, and identifying priorities for the near term. All these activities are in addition to evaluating how the senior team works together. A seasoned GC will ask the CEO how best to be of help, how best to communicate, how often to communicate, and will very clearly express the desire to be part of a team that supports the business in all areas. Being a clear collaborator will be even more important as the new CEO gets to know the strengths of each member of the leadership team.
The most important place to start is to understand the business and what will make the company successful. The legal/business distinction is often a blurry line and it takes experience to understand where to draw the line.
One of the most important first steps is to determine why the CEO has no interest in a relationship. Generally, those difficult issues are rooted in a number of misunderstandings on both ends. Consider a candid conversation regarding what the CEO expects from a General Counsel and then let the conversation flow from there. For example, if the CEO believes the GC is just there to react when requested, you can engage in a conversation around what more a GC can do and how being proactive is much more beneficial to the business. It is a journey to be sure, but it starts with clear and open conversations.
Based on our experience, it is helpful to know where the grey areas may be but then (knowing there are no guarantees) provide a percentage chance of success and provide a recommended course of action. Again, this is also largely dependent on what suits the style of the CEO. Ask the CEO what their preference might be.
Unless there is a clear legal consequence that puts the company in jeopardy, agreeing to disagree is part of every management team. Successful GCs will learn to appreciate this, not take it personally, and continue to look for creative ways to protect the company while minimizing risks.
You will have the opportunity to have a once-in-a-lifetime onboarding experience. Although no doubt it will be difficult, there is a great opportunity to establish yourself as a team player and valuable partner from day one. Conference calls, Zoom meetings, and constantly reaching out to both introduce yourself and to learn from others will be critical. It is always helpful to be able to read the body language while “in the room” during the first 90 days, but you won’t have that chance. So double down on listening, asking questions, asking for advice, and checking in regularly. Not an easy situation but a great opportunity to really shine.
It totally depends on the issues to be discussed and the relationship between the GC and the board members as well as, indirectly, the relationship the GC has with other members of management and the relationship the board has with other members of management.
CEOs are smart people; they know who the GC represents even though there may be times that the GC feels that the CEO doesn’t actually know that. Unless there is a problem that needs to be specifically addressed, being “in your face” with the CEO may be perceived as pitting the GC against the CEO. This is never helpful and rarely necessary.
Assuming the GC is a “can do” thinker, it is always better to have the GC in the discussions up front.
Yes, without question. This is a great topic for an offline conversation as there are many factors that should be considered. This is an important area of the coaching work that the BarkerGilmore senior advisors provide to AGCs.
The cadence will largely be directed by the CEO but, whenever possible, it should be daily and even more frequent if the situation requires.
Certainly, issues of how best to care for the workforce while also addressing the needs of clients/customers. Liquidity preservation has also been an area of focus for many companies. Additionally, for public companies, there is a whole other layer of public disclosures to consider.
There is no one format that works for everyone, but an ERM (enterprise risk management) model that looks at strategy and then identifies risks and barriers to executing that strategy is often helpful. Again, when identifying barriers, it is important to also identify how to remove those barriers. Also, if the management team is familiar with the language/format used in the company’s ERM process, it will be easier to communicate and easier to understand.
Different boards absolutely interact with GCs differently. It is incumbent on the GC to establish a strong business relationship and trust between the GC and the board. This relationship will be based on clear and timely communication and a demonstrated understanding of the business and being solution driven. Very much the same qualities are relevant in developing a strong relationship with other members of the C-suite. It may also depend on the specific issues facing the company at any given time.
We really don’t differentiate the two.
The best outside counsel will be viewed as a business partner. The issues that require the use of outside counsel will also impact the view of outside counsel. There is no quicker “death” for outside counsel than being viewed as obstructionist, not timely in responses, and not understanding the business when addressing legal issues.
It does seem that GCs have greater exposure than in the past, but we have not done specific research in this area to have hard numbers.
As an advisor, the GC’s value will largely be qualitative rather than quantitative. It is measured in the way that all qualitative relationships are measured.
This is an age-old complaint about in-house legal departments. This perception can be changed over time by hard work of all members of the legal department getting out to meet those business partners, understanding their objectives and challenges, and developing trust that the lawyers are problem solvers. The other critical factor is being timely in getting work back to the business units. Being responsive is equally as important.
Accounting and finance to be sure. Operation process flow are skills a good GC should be able to acquire as they learn the business.
This depends on many factors such as the prior relationship the lawyer has with the company they are joining, the type of work the lawyer does, the needs of the company, the type of company (start up, established, large, small, public, private), and a number of additional factors such as personality of the lawyer, business focus of the lawyer, etc. There are significant differences for even the best law firm lawyers as they move in house. This is actually one area where a good and valued advisor is invaluable.
Difficult balance, but there is no reason a GC can’t serve both functions.
Yes, there’s no question outside counsel play a part if there is not internal expertise. And yet, it is the responsibility of the GC to manage that relationship and manage costs and frequency.
Yes, absent extraordinary circumstances.
This is a slippery slope and hopefully will not gain much traction.
Ann Harlan and our team of professionals are happy to help accelerate the initiatives that you're already pursuing, or to supplement your current strategic thinking to help you realize your vision. Please reach out if you or your organization may benefit from our recruiting, coaching, or advising services.