Members of the legal profession are not always the first to embrace or promote change. Change can sometimes be a struggle for lawyers.
Today, in-house counsel are confronting drastic changes that are not derived from evolving law or legal interpretation. Rather, they are the same changes that any corporate employee faces in this post-Great Recession era. Corporate America conducts its business in a significantly different manner than it did previously:
1. More is expected of employees. It follows then that lawyers, like everyone else in an organization, are being challenged to deliver more output with fewer resources. Management has become immune to the negative impact that this has on employee morale. Moreover, management is often faced with the same demands from those to whom they report.
2. The rewards are being reduced. Raises are not necessarily elevating the standard of living for many corporate employees. The percentage of average employee raises is often less than that of companies’ reported profits. A greater percentage of the rewards tends to flow toward those in the income-generating departments. Lawyers are generally not viewed as revenue-generating.
3. Success is measured by short-term results. For publicly traded companies, Wall Street either rewards or punishes a corporation on the basis of the profits or losses of its last quarter. A corporation is not necessarily evaluated on one of the most important elements of its continued success—its long-term strategy. In this type of setting, in-house counsel are focusing more on the day-to-day issues without any guidance from the business side as to the “big picture.”
4. Innovation is today’s mantra. Innovation does not necessarily capitalize on the skills that most lawyers bring to an organization. To be innovative, companies must take greater business risks, which bring with them increased legal risk. The risks grow when there is little or no precedent for the innovation. The legal parameters by which in-house counsel advise businesses are either nonexistent or vague. This creates an even greater tension between legal departments and the innovators within marketing.
To come to grips with these changes, in-house counsel must learn to embrace them. In-house counsel should encourage management to articulate the rationale for change and then make it transparent to all employees so it can bring a positive and fresh approach to business.
In-house counsel, in the face of so much internal change, must advise corporate clients in a manner that both demonstrates their embrace of change and provides clients with a legal road map that guides them through this time of transition. There may never be precedent directly on point; however, strong in-house counsel know how to extrapolate relevant advice from prior experiences and those bodies of law in their practice areas.
When you feel the changes have moved off-course, do not shy away from sharing your concerns with your direct superior. Emphasize your understanding of the positive value that the changes bring to the organization, but suggest how, with some modifications, the changes can return to their original purpose. Never should in-house counsel seek to extol the virtues of “the way we always used to do things.” Most of Corporate America has moved beyond being hamstrung by the past.
In-house lawyers who have embraced change can become change agents and active advocates for businesses in advancing the shifting agenda.
Thomas Lalla is SVP and GC of Pernod Ricard USA.