Twelve months ago, when Legal Business’s inaugural GC Power List landed, the global economic outlook was still decidedly bleak. Talk of a double-dip recession had started to feel like blind optimism, with global manufacturing output at its lowest level since 2009, unemployment in the eurozone at epidemic proportions and signs that the Chinese economic engine was beginning to falter.
A year on and there’s cause for cautious optimism, in the UK at least, with joblessness falling and it seems more reason for economists to be bullish about the strength of the recovery than for half a decade.
I’m not so sure.
I see the dust still settling and, until it does, I don’t think anyone can accurately predict what the economic landscape is likely to resemble. I’m all for stepping onto the ice, but it’s as well for us all to tread carefully as it may well be thinner than we think.
What is certain, though, is that the prolonged period of economic turmoil and uncertainty caused by the financial crisis has already led to a fundamental shift in the way we in the legal profession do business.
As I wrote in last year’s Power List report, since 2008 in-house lawyers have been forced to adapt fast, learn new disciplines and take on additional responsibilities, or risk becoming at best an afterthought in the minds of the C-suite they report to. The smarter and more agile law firms have changed their operating models, too, emerging as leaner, more commercial and better evolved to support their clients’ changing needs.
And that’s as true now as it was 12 months ago – arguably even more so for the next generation looking to climb the rungs of the in-house ladder.
What I’ve learned from the time I’ve spent with clients is that, for many aspiring GCs, the goal is to carve out a role beyond being a one-dimensional legal expert to becoming a key strategic adviser to the board, positioning themselves as essential to the future success of the business.
So, with the benefit of looking from the outside in, how do the in-house leaders of the future gain this influence they crave?
For me, it all comes down to earning trust. And to earn that trust in-house lawyers need to be able to demonstrate value. Yes, you have to be a first class lawyer, but that’s no longer enough. Today, it’s more about how you can show the board that what you do makes a material difference to the commercial success of the business.
It’s now ever more important for external legal advisers to grasp the commercial drivers that impact on every area of their clients’ operations.
We, in private practice, have a role to play here. It’s now ever more important for external legal advisers to grasp the commercial drivers that impact on every area of their clients’ operations so that advice is delivered within a business context and communicated in a way that makes sense not just to in-house lawyers but to their colleagues and the board members they report to. Not only that, but it should also be part and parcel of the service we offer to share the commercial lessons we glean through the experience of working with clients in a range of different sectors.
Top class communication skills and the ability to build strong relationships are as important internally as externally, particularly for those with ambitions on advancement. But it’s not simply about building relationships – it’s about building the right relationships, over time. Those GCs who enjoy the greatest levels of influence in their organisations tend to be those who understand the complex dynamics at play between the senior people they work with.
If you can work these relationships, and ensure you’re in the right place at the right time when the key decisions are made, it won’t be long before you’re working in partnership with your board and part of that decision-making process at a strategic level.
But it doesn’t end there. As the legal function grows in importance and gains prominence, in some of the larger organisations the requirement for senior in-house lawyers to have a deep and broad management skillset to nurture and develop a wider pool of talent is ever increasing.
More often than not, though, the internal resources aren’t there, so it’s incumbent on external advisers to offer their clients that support. I know from talking to GCs week in, week out, that there’s a real appetite for this kind of learning – law firms need to make sure they have the people, systems and processes in place to meet that demand.
In the wake of the shakedown of the global economy comes a requirement for the in-house lawyers of today and tomorrow to be much more fully-rounded business people than was traditionally the case.
This impressive list of rising stars of the in-house world shows that this new breed is already emerging, and building the skills needed to take their place at the top table.
Jonathan Watmough
Managing Partner
RPC