By Lloyd M. Johnson Jr., Chief Legal Executive LLC

For many years, CEOs looking to hire general counsel have looked beyond legal skills to find good, solid, strategic business counsel. That’s no longer enough.

The ability of the chief legal officer to manage the legal department and to stay one step ahead of both the C-suite and the board are the baseline requirements. But there are new factors to be dealt with. Institutional investors are increasingly impatient. CEOs and board members have more sophisticated expectations of the general counsel. And many sitting CEOs and general counsel are on the verge of retirement.

As a result, while CEOs looking for new general counsel are looking for top attorneys whose skills have been forged in a solid, forward-looking understanding of business and industry, they no longer expect that attorney to simply help guide the company along the right road. That attorney, instead, is expected to be the company’s mapmaker.

Given this development, it occurred to me that it would be useful – for general counsel, future general counsel and the CEOs to whom they report – to see just how we got here and where we’re likely to go in the years to come.

For help with that, I touched base with four executive search professionals who specialize in placing top legal officers: Cynthia Dow at Russell Reynolds, Julie Preng at Korn Ferry, Victoria Reese at Heidrick & Struggles and Paul Williams at Major, Lindsey & Africa. Williams, who was general counsel at Cardinal Health, a Fortune 500 healthcare services company, from 1995 to 2005, offered a unique from-the-trenches perspective.

The Captive Law Firm

Back some 40 years ago, the legal department wasn’t usually the first choice for the most ambitious attorneys, for whom law firm partnership was the brass ring. Though it offered less stress and fewer hours, the legal department seemed short on challenges, glamour, glory and competitive compensation.

That started to change in the mid-1980s. “All of a sudden, I was getting calls to go in-house,” remembers Preng, who was then an associate at a New York–based law firm. “A friend got a call to be a corporate secretary. We didn’t even know what that meant.”

What happened, Preng says, is that people running legal departments “started hiring outstanding lawyers. They started to say, ‘We’re going to create a captive law firm and become better than outside counsel for less money. We’ll start thinking about the business, and people will want to come to us.’”

GC as Gatekeeper 

The late ’90s, says Williams, was “a heady period, an exhilarating time of tremendous growth, with lots of M&A activity going on and many companies really soaring.” And given the general counsel’s elevated prestige, it was also a heady time for the legal department. General counsel, Williams says, had “worked long and hard to be taken seriously as business people. They had moved out of the legal box, were invited to the table with the top executives and were seen as respected business advisors.”

But then came what Williams calls the “age of the scandals.” Tyco, HealthSouth and Enron were “all earthquakes for GCs.” Suddenly, he says, the general counsel’s naive presumption that “if you got to be a CEO or CFO, you were not a crook and would abide by the rules” was shaken to its core. In addition, adds Preng, there was a realization throughout the C-suite that “everything I’ve done is at risk, and I’m not going to hang myself out to dry.” And that, she says, “gave rise to the concept of someone who would be the holistic risk manager for the CEO and the board.”

That someone, of course, was the GC, and with the backdrop of Sarbanes-Oxley, general counsel found themselves pushed right back into the policing, gatekeeper role. “If you didn’t do that,” says Williams, who speaks eloquently about the “blood, sweat and tears of getting through that period,” then “things could blow up.”

GC as Business Partner

But by 2005, Preng notes, “the paradigm of the successful GC profile had started coming back – and this time a number of additional components were added to it, in particular risk management and leadership.” The difference was that risk management was so much more broadly defined, with the GC managing risk for the whole organization and enjoying a newfound credibility throughout the business. The top in-house counsel now “had to think holistically and broadly about what the regulatory and legal environments mandated, but he or she also needed to think about what the client was trying to achieve, the desired results – and the best solution.”

GC as Strategic Advisor

As the century progressed, the acceleration of business, the growth of technology, the spread of globalization and the increase in regulation made it imperative, says Dow, that general counsel had a well-developed business acumen, a curiosity about the business, an understanding of market dynamics and the ability to make quick, informed decisions. This required, Preng adds, the ability to “bend around corners to see what’s coming, to think ahead about managing risk, to understand what the tolerable risk level will be, to be comfortable making a decision and creating a solution, and to step out to be a leader, helping people through problem-solving.”

Summed up, Dow notes, this meant that the general counsel needed “to provide dynamic leadership, cut through bureaucracy, distill enormous amounts of information and communicate in a business-friendly manner.”

The general counsel, Reese points out, “needs a great backbone, a great moral compass and great influencing skills.” Moreover, adds Williams, the general counsel must have “phenomenal interpersonal skills,” since “in the course of the day, the GC will be playing countless different roles, from being deferential with the board to going toe to toe as a one-on-one counsel with the CEO to inspiring a large legal department.”

And then there’s chemistry. How well the CEO and the GC will get along will vary, and this, says Williams, “is such a critical element in the effectiveness of the general counsel.”

The Activist Investor

All of this has been intensified in the last two years as companies have found themselves the targets of impatient institutional investors, eager to show the CEO the door, with the general counsel following close behind. It’s now critical, says Preng, “that the general counsel be prepared to understand how to balance successfully what the investors are looking for and what the company wants to provide,” steering the ship along the route that the general counsel, as mapmaker, has devised.

Given all of the above, how important is it that someone looking for a GC position has previous GC experience? All of the recruiters I spoke with say the same thing: It depends. Many companies looking for general counsel tell their recruiters that they’re looking for what Dow calls “enterprise perspective and breath of experience,” which means, she says, that “they’re looking for the closest possible fit to the current role, essentially plug and play.”

But Williams and others say they prefer to present a combination of backgrounds, “someone with GC experience as well as some who have been poised below the GC level and need the opportunity to move up to the GC chair.” With a whole generation of GCs on the verge of retirement, he notes, “we have to replenish the pool.”

The Self-Awareness Test

Still, these recruiters caution, not everyone is ready to jump into that pool. For those not yet ready, Preng suggests finding ways to close the gap by getting exposure to a broader range of responsibilities. Even with that, Williams says, some people are just not meant to be general counsel, and he adds, “that’s not a bad thing.” What’s critical is self-awareness, an ability to look at oneself – and the GC role – dispassionately. “I often ask people who say they want to be a GC but haven’t yet been a GC why they want to take this position. About 30 percent of the time the person looks at me quizzically because it’s their assumption that everyone should want to be a GC. I’m often amazed at how often people haven’t thought it through and how often there is misalignment.”

And as we’ve seen, alignment – of skills, personality, work style and more – is critical to the success of any GC. There’s a reason, Williams notes, that the compensation has climbed the way it has. The job, as now defined, demands it.

Next month we’ll begin a three-month deep dive into the legal departments of three companies that have successfully transformed themselves to fit the new paradigm and the GCs who make a major difference, as mapmakers, throughout their corporations. And we’ll see the impact the changed role of the general counsel has had on that transformation.


Lloyd M. Johnson Jr. is chief executive of Chief Legal Executive LLC, a company that brings together thought leaders in the legal industry to discuss critical issues at conferences and events. He can be reached at