Why General Counsels make excellent choices for corporate Boards?
Let’s think what general counsels and corporate lawyers do in a company. General Counsels very often act as secretaries in the Board and its committees. In this role they read all the material sent to Board members and make sure that the proposal which is to be presented to the Board for approval is written in a clear way and contains all the relevant information. The agenda is prepared by the secretary in cooperation with the CEO and Chairman. Finally, the secretary sends or arranges the material to be sent to the Board and its committees. General Counsels are also at present in the meetings of the Board and its committees and advices in legal matters as well as prepares the minutes of the meetings. It is safe to say that the secretary is at the very center of the Board and its committee work.
If the company is publicly listed, the General Counsel needs to ensure that the Board takes into consideration the legislation concerning insider information and manages such cases and thereto related information. In addition to that she/he needs to be aware of the stock exchange regulation and corporate governance codes.
General Counsels are at the heart of Board work
One may say that all the above is not enough for Board Membership, and it is not, of course. How about business awareness? Are Corporate Counsels business minded or are they able to take part in strategy discussions?
The same General Counsels have drafted, commented and negotiated several business agreements; purchasing, sale, distribution, licensing, co-operation, etc.. They have been or still are heavily involved in business negotiations and are participating hands on in planning projects.
To all corporate lawyers M&A is familiar territory, some are hands on in drafting the documentation and involved in negotiations. Even if outside counsels are drafting the documentation, the in-house counsels coordinate the project and the negotiations. Finally they prepare the proposals to the Board with the management.
The list of tasks and experiences can be much longer; IPRs, employment matters, incentive programs etc. It is difficult to come up with a role whereby a person would be more involved in so many aspects of a company’s operations.
Last but not the least, General Counsels are very often members in the management team and take part in business discussions and decisions. Often they also take part in planning the corporate strategy. Having spent several years in certain business in management team and as Board secretary the numbers and the cost structure in in the back bone.
According to my view and the general opinion during the discussions at our latest Fondia General Counsel Round Table event, it is easy to say that General Counsels are excellent candidates for Corporate Boards.