What is general counsel?

Why Does a Company Need a General Counsel?

While companies frequently hire outside law firms, a company’s in house general counsel play are the go-to advisors for the board of directors, CEO on laws and regulations as well as public policy, ethics, and risk. A general counsel may assist a company in the following areas:

• Intellectual property protection
• Finance and banking details
• Employment law information and training
• Due diligence assistance
• Compliance assessments
• Business maintenance plans
• Contract drafting, negotiation, and review

General counsels are vital to most companies because they prevent employees from seeking legal counsel for specific issues or CEOs from consulting with numerous attorneys. A qualified general counsel can handle a vast range of issues and proactively develop protections for the business that contribute to the company’s success and security.

For example, in a single day, a competent general counsel might help with a human resource issue concerning employee termination, deal with an impending lawsuit, field questions about new federal laws and how they might impact the company, and provide counsel to owners during a board meeting.

Excellent general counsels create original, detailed legal plans for their companies, which are vital to every successful business.

What Makes an Effective General Counsel?

An effective general counsel is creative in identifying proactive solutions to eliminate or mitigate risks and advance the business. To be effective, general counsel participate in leadership discussions of complex problems and creative solutions.

General counsels must exercise sound judgment and deal effectively with various legal questions and responsibilities. General counsel must also be a sound cultural fit for the company and possess an excellent sense of integrity.

Additionally, a company’s GC should have a clear sense of the company’s priorities and values and be able to incorporate constant input from shareholders, CEOs, and other key company officers. Another skill a GC should possess is listening to diverse perspectives and incorporating them into their legal plans.

More and more frequently, general counsels are the main advisors for company CEOs on a variety of issues, including:

• New laws and regulations
• Company ethics
• risk management
• public policy

All company CEOs need an attorney they can trust to manage difficult situations, such as employee misconduct, negligence, gross misconduct, or fraud. Business leaders rely on sound legal advice and clear communication, especially regarding future risks. They need an attorney who can deal with the consequences of the company’s decisions in a controlled, organized, and productive manner.

General counsels can also save companies money. Since law firms often charge an hourly rate, seeking constant legal counsel for company issues can become costly. Paying a general counsel a competitive salary eliminates the need for constant hourly payments to various attorneys.

What Attributes Should a General Counsel Have?

Both experience and attitude are important when selecting the correct general counsel for a business. The key attributes and skills a general have are:

• Hard working
• Ability to inspire others
• Visionary
• Anticipate legal issues and risks
• Use of legal strategically
• Leadership
• Strong analytical skills
• Impartial judgment

The more the GC is interested in the company and knowledgeable of the business’ values and goals, the better counsel, the general counsel can provide.

Therefore, a general counsel should not only possess legal expertise but should also be able to weigh in on important business decisions. GCs should understand public policy, industry trends, and finances. They should also be specifically equipped to advise the business in their affairs. For example, the GC of a technology company need not be an expert in programming and coding. Still, they should understand the company’s goals and the current developments in the field.

General counsels should understand how to calmly present the company with the facts of the case and weigh in on the decision they deem the most risk-averse. The general counsel should have a duty toward the company and view every decision through the lens of what is best for the business.

Many CEOs take risks to help the business progress, and the general counsel should be able to evaluate the upsides and downsides of those risks and decide what decisions make the most sense.

Therefore, experience, attitude, and decision-making are all areas in which a GC should excel.

Excellent general counsels help companies make difficult business decisions in an informed, confident manner. When a CEO, for example, understands the risks and possible advantages of an upcoming decision, they will usually make the right choice. General counsel must be decisive and informed and always place the company first.

Contact Nakase Wade

At Nakase Wade, we understand that running a business successfully involves making difficult decisions. We provide legal counsel to businesses, from sole proprietorships to large corporations. Our California business lawyers and corporate attorneys understand what it takes to succeed in the corporate world, and we are available as your company’s general counsel.