Global legal departments are challenged by diversity, not only of the individuals who make up the organization but also internal clients, external suppliers, customers, strategic partners, and stakeholders, as well as diversity in the various legal and regulatory regimes and business cultures within which they operate.
Legal departments that successfully manage these challenges can not only add significant value to their clients in terms of efficiency, practicality, and speed, they can also provide their organizations with a distinct competitive advantage over those that flounder in the face of sometimes monumental hurdles.
There is no simple “best practice” for any of these issues, but listed below are some of the strategies I have found effective in my own practice, and that have worked well to create a strong team dynamic and helped deliver high-quality and inspired legal support.
My sense is that it is best that regional lawyers report on a solid line to the general counsel. Dotted-line reporting to the GC and direct-line reporting to functional or business leaders threaten to weaken the fabric of the legal department.
From a corporate governance perspective, particularly regulatory compliance and risk mitigation, it is best that the GC be accountable for the entire gamut of responsibilities of the legal department to the CEO and, ultimately, on to the board. Local commercial or other regional concerns should not be allowed to override fundamental compliance requirements.
Internal pay equity needs to be balanced against local market realities. Equal compensation across the board may not be realistic in terms of securing appropriate legal talent as market conditions may vary from region to region. That is not to say that regional lawyers should be evaluated, promoted, rotated, or removed based on different standards. Pay equity should not dictate special treatment in other employment areas.
Service-level commitments should for the most part be the same across the board. Differing standards can be rationally justified based on the specific needs of the business group being supported or factors such as relative importance of the group as a revenue contributor to the overall business. Absent such considerations, from an organizational perspective, it is best to have a uniform set of commitments in terms of ensuring accountability, organizational simplicity, and setting of client expectations.
The legal department budget and cost controls should in my opinion be centralized and owned by the GC. Regardless as to whether legal spending is tied to group revenue generation or contribution to the bottom line or if some units charge back costs to clients, the budget and costs must be predictable and consistent from jurisdiction to jurisdiction.
No GC wants to explain why legal costs in one jurisdiction are five times higher than the costs of the same services in another jurisdiction unless there are demonstrative, uncontrollable reasons for that to be the case.
I have, in the past, asked that client groups complete surveys commenting on their level of satisfaction (or lack thereof) with legal support. A simple online survey requesting input on whether legal support is timely, practical, insightful, creative, etc. can yield very important feedback instead of relying on speculation and unsupported assumptions.
Surveys help to position the department as responsive, integrated, attuned to the business, and aligned with corporate objectives. A lack of feedback can have the opposite effect: It creates a sense of aloofness, disengagement, entitlement, conservatism, etc.
Legal teams, in general, need to cultivate an open-door policy and a sense of urgency and shared business and other corporate goals.
Examine benchmarks from other legal departments. Perhaps there are ideas or practices that have been optimized in another company that you can learn from without having to re-invent the wheel: a sample slate of metrics, a departmental communications strategy, a retention policy. Look around for concepts and practices that are tried and true, rather than assuming you have to invent them all yourself.
Allow your department’s lawyers and staff to help make the decisions. Give them the opportunity to weigh in on how they can be better connected, co-ordinated, and collaborating.
The GC should be the one to decide how best to drive such an effort, but regional lawyers need to buy in and be engaged. Substance should matter over form. Get to know your team, request input from them in terms of how best to learn the business, learn client’s requirements, keep on top of legislative, business, and other changes, and how best to support those needs both from a local as well as a centralized perspective.
Decisions such as how to share information, how best to communicate among the team and with clients, which client meetings to attend, and how best to have an effect on and influence client groups should provide insights in terms of the ideal infrastructure of the legal department.
The structure should fall out of these local and head office decisions.
Use centralized document databases for templates, legal opinions, policies, and procedures to ensure consistency.
During a one-year stint at Nortel Networks, I was part of a small legal team that (in addition to our day-to-day responsibilities for several client groups) centralized and promoted uniform licensing, contracting out, supply chain, sales and distribution, and non-disclosure agreements. We discovered there were more than a dozen different non-disclosure agreement templates being used by the company, and that the position we were taking on several clauses conflicted and were being used against us in negotiations.
Micromanagement often means disempowerment. Recruit carefully and then learn to trust (and verify). Focus on high-quality work completed on time as opposed to reporting in and “death by meeting.”
Visit occasionally. As GC, meet with your team members and, as importantly, with their clients. There is much to be learned by on-site visits. Understand what they do, what their needs are from head office, how they feel being in the hinterland, and how you can improve the quality of the department’s work and its usefulness to the organization.
Where possible, rotate legal coverage areas occasionally. Legal roles are typically aligned in a matrix depending on factors such as geography, sales channel, product group, technology area, and legal responsibilities (e.g. commercial, intellectual property, litigation, human resources, etc.).
Rotating these roles from time to time helps to provide consistency, a better understanding of the organization as a whole, helps to surface expertise in particular areas, and is helpful for backfilling a position should a member of the legal team leave the organization for whatever reason.
When there is no water cooler to gather around, intranet tools can bridge differences and create the proper level of formality and informality conducive to creating a sense of cohesion and a shared mission.
Instant messaging does not seem, however, to translate well. We all have a personality we bring to the table, and much of our finer communication tools might be lost or misinterpreted through tools with limited capabilities. Voice and video streaming can go a long way towards conveying personal characteristics such as judgment, reason, authority, etc.
I believe it is often true the most attentive person during group meetings is the presenter! There is a lot to be said with regard to rotating the hosting of legal department meetings. It helps ensure all members are included, no one region is more important than the other, and allows the host to perhaps focus on local concerns, giving the rest of the team members a different perspective on their own clients and challenges and ideally helping the host find a solution to the pressing concerns they have been grappling with.
Meetings that are consistently hosted by the department head sitting in the head office tend, in my experience, to overlook regional issues.