FTI senior managing director, Wendy King, describes the evolution of the role of general counsel, especially in regards to the challenges met in 2020. In order to help their organizations navigate 2021, there are tasks to consider.
In corporate legal departments, recent years have seen a steady rise in planning and establishing programs to mitigate anticipated risks. Alongside this focus on proactive risk management, the role of the general counsel evolved from the office of “no,” to one of significant strategic influence. Once largely viewed as a cost center, or barrier to corporate progress, the general counsel of today are business drivers in their own right.
This evolution for the general counsel came in the nick of time for the turmoil of 2020. In the 2007 best-seller, The Black Swan: The Impact of the Highly Improbable, by Nassim Nicholas Taleb, the author discussed the discovery of the first black swan in Australia – when the people of the “Old World” assumed with certainty that all swans were white – as a metaphor for the impact of rare and unpredictable events. Although Taleb has questioned whether the Black Swan is a metaphor for the COVID-19 pandemic alone, the idea of Black Swan incidents serves as an excellent guide for analyzing the sequence of unpredictable events that have shaped 2020, and changed the world of chief legal officers for 2021 and beyond. The pandemic, changing technology, increased risk, economic uncertainty, a social justice awakening and political unrest have combined to challenge beliefs on the Old World of the general counsel as these leaders build resilience for the future.
To better understand the current in-house environment, FTI Technology and Relativity engaged Ari Kaplan Advisors to interview general counsel from a range of industries in a conversation about their role today. The study examined how corporate legal departments are responding to the pandemic, a shifting digital landscape, diversity, equity and inclusion, the technological competency of lawyers and the road ahead. In addition to providing new perspectives on current trends and future directions, this report also offers year-over-year comparisons to the findings of the previous study, The General Counsel Report: Corporate Legal Departments in 2020.
As much as the world is hoping for a quick recovery from the fallout of 2020, many of today’s challenges will persist into 2021 and very likely beyond. The burden of maintaining business resiliency and stability in this environment will continue to fall on the GC’s shoulders. To continue to rise to today’s challenges, corporate legal departments must embrace the lessons learned from Black Swan events, expand their existing responsibilities and take ownership of their newly assigned roles. To help their organizations successfully navigate 2021, GCs are tasked with elevating their role in the following capacities:
Guardian Over Emerging Risk
Counsel are navigating a minefield of both anticipated and unforeseen risks. Data protection, security and privacy, emerging data types and intellectual property loss were identified as top concerns that have intensified due to the events of 2020.
Chief Health Officer and Custodian of Employee Safety
More than 80 percent of GCs surveyed said they are responsible for or primary decision makers in determining company policies for bringing employees back to in-person work and ensuring workplace health and safety.
Mitigator of Skills Gaps and Outsourcing
Many GCs recognize skills gaps and bandwidth limitations among their in-house teams, which is driving specific needs for outsourcing to external experts, service providers and law firms.
Advocate of Technology Proficiency
Corporate legal departments are adapting to remote workplace productivity tools and increasing overall technology proficiency. Confidence in technological capabilities increased by more than 15 percent since 2019.
Champion of Technology Adoption
One third of in-house legal teams are now using artificial intelligence (AI) as part of their technology stack (a slight increase from 2019) and 70 percent use cloud or SaaS systems. Some survey participants noted that their plans to modernize their legal departments were hampered when COVID-19 lockdowns went into effect.
Steward of Inclusion and Diversity
With equity issues having reached the forefront of societal attention and debate, GCs today are likewise at the forefront of tackling diversity, equity and inclusion programs within their organizations.
Mentor for the Legal Field
Survey respondents had a wide range of advice for their peers and their outside legal partners. Top takeaways included remembering to exercise empathy, remaining flexible and listening intently to colleagues and clients.
Published February 2, 2021.