Integrity and Professionalism Are Paramount

“It takes many good deeds to build a good reputation, and only one bad one to lose it.”
– Benjamin Franklin

Practicing law is an  honorable calling. Never ever forget that. We are professionals duty bound to zealously represent our clients to the utmost of our ability. Sometimes non-lawyers view lawyers as shifty characters who will go to any lengths to win a case. I think this is because they don’t really understand how we work. We make arguments that clients might not always understand. We present the facts in a light most reasonable to the position that is favorable to our clients. We posture. We cajole.  We threaten. We tear into people in search of the truth. We often deal in unpleasantries. 

It is true - not many people are fond of lawyers as a group, until they need one. We sometimes then get the wink and knowing nod from the client, to demonstrate that they “understand” how we operate, they’ll play along and assume that we will take care of the dirty stuff outside of their presence.

Many clients do not understand that it is our sworn ethical obligation to represent them zealously, honestly and ethically. When I passed the Bar Exam, someone sent me an article likening a new lawyer’s integrity to a brand spanking new shiny suit of armor. The suit protects the lawyer’s untarnished reputation. Each time the lawyer compromises his or her integrity, the armor is nicked, rust appears corrupting the protective coating worn by the lawyer and eventually lays bare the vulnerable flesh beneath it. This is an apt analogy don’t you think?

How many times have you encountered a lawyer that rarely does what he says he will do, cuts corners on advice, pads the bill a tad or fudges “just a little” on document production? How do you view that lawyer when you next cross paths? On the other hand, how many times have you encountered an adversary who behaves as the ultimate professional, who can be trusted not to take pot shots at you or use underhanded tactics to gain an edge? At the end of the day, in which case does the client fare better?

Our jobs and our lives are complicated enough without having to negotiate the day (or the deal) worrying about whether or not the people with whom we are dealing can be trusted. Whether with our adversaries or with our own clients, we have a responsibility to ourselves, to our clients and to our profession to be honest, to say what we mean, to do what we say, honor the profession, respect the law, do what is right and win. How pleasant our professional lives are when we practice these principles and have them practiced on us.

So, polish up your suit of armor, strap it on for battle. Shine for your clients and your profession. Do the right thing. Most of all protect your integrity, for at the end what does any one of us have left but our good name?

Corporate Social Responsibility and Human Trafficking (Denial and Benign Neglect)

“It ought to concern every person, because it’s a debasement of our common humanity.  It ought to concern every community, because it tears at the social fabric.  It ought to concern every business, because it distorts markets.  It ought to concern every nation, because it endangers public health and fuels violence and organized crime.  I’m talking about the injustice, the outrage, of human trafficking, which must be called by its true name—modern slavery.” 

Barack Obama

I had the good fortune to attend the Society of Corporate Compliance and Ethics Regional Compliance and Ethics conference in Chicago. The day’s events were moderated by Ted Banks, one of the leading legal and compliance professionals in the country and there were many excellent speakers. To report that I was enlightened by the presentation on Human Trafficking given by Matt Friedman of The Mekong Club would be a gross understatement. I never could have imagined the depths to which human beings will stoop to prey upon their fellow human beings in exchange for money.

Matt told stories of child “Camel Jockeys”, where Pakistani children are sold into Gulf State countries to toil and moil on the backs of camels, their screams and yelling spurring the camels to run faster, until the age when they are too heavy for the camel to bear. He told of 14-year-old girls from rural villages, believing they were marrying into a better life, being sold for cash to a brothel in a faraway city by their new “husband” and systematically raped into submission, forced to service ten men per day and having their families threatened with death if the young girl tried to escape. He told of naïve villagers, being lured by the promise of triple the typical daily wage, moving to the city, living under lock and key in company “housing” for which they were charged a fee that exceeded their wages. Finally, he told of legitimate factories in Asia which, by day, employed local people for fair wages. But under cover of darkness, the child slaves were brought in to finish the work the day shift started - this being the only way the factory could compete in a highly competitive marketplace.

Why does any of this matter to you as an in-house lawyer or compliance professional? Approximately 20% of global human enslavement involves labor exploitation. Matt’s presentation underscored that otherwise legitimate, well-intentioned businesses, play an important role in enabling the use of slaves – simply by ignoring the issue. Many of the goods and services that we rely on in our day to day lives may have been produced by the use of forced labor somewhere in the supply chain.

It is very popular today for business folks to talk about Corporate Social Responsibility.  The topic occupies significant real estate on most company websites these days. There is no shortage of consultants willing to help your business create a nice looking CSR program (for a price).  But CSR has to be more than a marketing program! It must, according to Karen Quintos at Dell Computers, be more than a feel-good campaign or series of projects; CSR must be "a mindset that's part of [the company] culture." Why wouldn’t a scrupulous company include supply chain slavery as an integral part of its compliance regime?

Mandating responsible supply chain management is good business from both a risk management perspective and a corporate social responsibility standpoint. Not only are consumers demanding transparency in their producers’ supply chains as they become more aware of the issue, but lawmakers are also getting more involved. The National Conference of Commissioners on Uniform State Laws has approved and recommended for enactment in all states, The Uniform Act on Prevention of and Remedies for Human Trafficking.  Without getting into the weeds about what may constitute knowledge, the Act allows prosecution of a business when an employee or nonemployee agent of the entity engages in conduct that constitutes human trafficking and the commission of the offense was part of a pattern of illegal activity which the entity knew was occurring and failed to take effective action to stop.

The United Kingdom’s Modern Slavery Act requires every company doing business in the UK with global revenue in excess of roughly 54 million in US dollars, to publish a slavery and human trafficking statement on its website. Failing to have a policy is a shameful position to be in as a modern day conscionable business concern. Having a statement in turn requires compliance auditing to ensure employees and vendors abide by the policy. The mandatory reporting[1] encourages companies to detail steps taken to ensure there is no slavery or human trafficking in any aspect of its supply chain.

The California Transparency in Supply Chains Act focuses solely on human trafficking and slavery. The Act requires large retailers and manufacturers doing business in California to disclose on their websites the efforts the company is making to eradicate slavery and human trafficking from the company’s direct supply chain for tangible goods. The law applies to any company doing business in California that has global revenue of at least $100 million and that identifies itself as a retail seller or manufacturer on its California tax return.

In 2012, President Obama issued an Executive Order outlining prohibitions on trafficking-related activities that applies to all federal contractors and subcontractors, requires compliance measures for large overseas contracts and subcontracts, and provides federal agencies with additional tools to foster compliance.

While not positioned as a change in law, the objective of the United Nations Guiding Principles on Business and Human Rights, issued in 2011, is to enhance business and human rights standards and practices in a tangible way, which in turn contributes to a socially sustainable globalization. The Principles cast a wide net so that a business’ activities include both actions and omissions and business relationships include those with supply chain vendors. In other words, ignorance and intentional disregard for the facts is not permissible – there is an affirmative obligation to assess all business relationships to mitigate against the use of forced labor.  

Demonstrating a commitment to human rights means companies must have policies and procedures in place that include communicating a “tone from the top”, verification, audits, certification, internal accountability, and training. Thus bringing slavery/human trafficking into the same compliance regimes as environmental issues, social and employee-related matters (eg. diversity), and anti-corruption efforts. The difference between conventional compliance assessments and those conducted to assess human trafficking is that in the context of human rights, risk management goes beyond identifying and managing risks to the company itself, to include risks to rights-holders.

Matt Friedman is currently touring the United States in an effort to bring his message to companies, religious organizations, law firms and assorted compliance and legal professionals. If you are interested in hearing what he has to say, you can reach Matt via The Mekong Club website, or feel free to reach out to me via LinkedIn and I will be happy to put you in touch with him. In addition to the resources already mentioned, I recommend that you explore the issue further by visiting one of the following additional resources: Verite.org, the ACC website, Kelley Drye.

Finally – we must take what we have learned and act upon it. Lawyers and compliance professionals are uniquely situated to influence our clients to forward thinking action, in ways that will make our work places better, our companies socially responsible and in ways that enhance the value of our products by making them sustainable and more attractive to consumers.

“An organization's ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.”

Jack Welch

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[1] A company must report – even if the report says “we don’t have a human trafficking policy”.

Big Law Implicit Bias – How Can it be Fixed?

“Never judge someone

By the way he looks

Or a book by the way it's covered;

For inside those tattered pages,

There's a lot to be discovered.”

Steven Cosgrove

As a member of the board of directors of the Association of Corporate Counsel, I am privileged to have the opportunity to participate in a fair share of ACC sponsored events. I recently attended the ACC Foundation GC Dinner in Chicago where twenty-four in-house counsel and law firm lawyers, gathered together in an intimate and “safe” environment to discuss how to improve the relationship between in-house lawyers and their law firm counter-parts. Assembled in the room were some of the best and brightest private practitioners in the country and their in-house counterparts.

The dinner was extraordinarily successful on many fronts. Everyone in attendance appreciated the need for outside counsel to develop close relationships with their in-house counterparts in order to build trust. Another hot topic was the need for in-house lawyers to bring “value” to their companies through the relationship with outside counsel. I’ll discuss these topics in future posts.

What really struck me as something that requires immediate comment was the experience of a young African American lawyer regarding a situation he faced while attempting to broker a deal between a client and the management team of his law firm. At the time, the young African American lawyer was pursuing a large client with potential for significant future billings. In order to help bring the client into the firm, he offered an attractive alternative fee arrangement to the client – subject to approval of firm management. As related by the young lawyer, he pitched the alternative fee arrangement to firm management and the idea was immediately dismissed out of hand. However, several months later, a lawyer who was not African American pitched a very similar proposal on behalf of the same client and the deal was accepted. The implication was very clear – the business deal was rejected in the first instance because the lawyer pitching it was African American.

I was flabbergasted. I found it very difficult to fathom that, in the enlightened world in which we live today (especially in the legal profession), a good business deal would be quashed simply because the pitch was made by a black lawyer. Of course, I have no idea what went through the mind of firm management as they made their decision. If, in fact, the conscious decision was made not to accept the proposal based on the race of the person making it then this would be a case of outright racism. However, I posit that this was not the case[1].

I cannot speak from a first person perspective when it comes to this lawyer’s experience as I am not a “big law” African American mid-level associate trying to build a book of business. However, as circumstances allow, I make it a point to seek to understand the perspectives of those who do not share my background. After the dinner ended, I reached out to another in-house lawyer who was African American. He confirmed that the experience related by the firm lawyer was not uncommon. While we did not have time to delve into the topic on a deeper level (nor do I have the space to do so here), I hope to continue the conversation soon and to follow up in an additional post on the subject. The question thus remained – “Why did this happen?”

In trying to answer the question, I circled back to some reading I had done on the topic of “Implicit Bias”. Implicit Bias (also known as “Unconscious Bias” or “Hidden Bias”) has been described as negative associations that ordinary people are found to harbor in relation to various social groups – even while honestly reporting that they regard themselves as lacking these biases. Stated another way – it is believing that one is impartial, but behaving as if one is not[2]. Experience shows that one is most likely to be implicitly biased in favor of those with whom one identifies and biased against those who are “different”. I suppose this makes sense, after all, if someone is “like me”, I can trust them – right?[3]

It is particularly important for lawyers to understand implicit bias because, once understood, it becomes an important tool for the manner in which we approach our day-to-day jobs. A study by Harvard researchers shows that implicit biases vary from person to person and that implicit attitudes are modified by experience.  And the good news is that implicit bias can be overcome through awareness, acknowledgement and conscious effort. The Harvard researchers tell us that one who wishes to rid oneself of an implicit bias can seek experiences that might reverse or undo the patterns that created the unwanted preference. A great example of a step that lawyers can take to help rid themselves of implicit bias is to interact with people or learn about people who counter the implicit stereotypes.

Once we understand that we may have a bias for a particular group or groups over others, we can attempt to manage our bias, check it at the door when making decisions or giving advice that pertains to or affects that group or a person within that group. For example, a lawyer or compliance professional must consciously discard implicit biases when assessing the credibility of a manager during an investigation or, when making decisions about accepting another lawyer’s proposal to offer a deal to a new client to bring in new business.

How do you know if you harbor implicit biases? I invite you to test your self-awareness of bias against the actual bias shown by your behavior by taking the brief Harvard Implicit Bias Test. While not perfect or absolute, the test results should move one to serious self-reflection and openness to the possibility that one’s thinking is not as objective as one might hope or believe – you will likely be very surprised by the delta between what you believe about yourself and the objective results of the test. I also urge you to recommend the test to your colleagues and friends. Implicit biases can be weakened, but only through awareness and open-mindedness to the possibility.

“Strength lies in differences, not in similarities”

Stephen R. Covey

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[1] “Social psychologists use the word prejudice to describe people who report and approve negative attitudes toward outgroups. Most people who show an implicit preference for one group (e.g., White people) over another (e.g., Black people) are not prejudiced by this definition. The IAT shows biases that are not endorsed and that may even be contradictory to what one consciously believes. So, no, we would not say that such people are prejudiced. It is important to know, however, that implicit biases can predict behavior. When we relax our active efforts to be egalitarian, our implicit biases can lead to discriminatory behavior, so it is critical to be mindful of this possibility if we want to avoid prejudice and discrimination.” Harvard Study, visited 5/30/16.

[2] It should be stressed that the study of Implicit Bias is not limited to racial bias – there are many biases that exist, for example biases based on age, physical appearance, gender or occupation.

[3] African Americans are not immune to negative implicit biases – about one-half of African Americans prefer Whites, the other half prefers Blacks.  National Center for State Courts paper, visited 5/30/16.

Focus on Your Big Picture to Thrive, not Just Survive!

Focus:  a point upon which attention, activity, etc, is directed or concentrated;  to fix attention (on); concentrate. Dictionary.com

I often start a column with a definition because it helps me stay focused on the message I am trying to convey. I am reminded of the need to focus every time I walk into the office and see the pile of papers on my desk and the ever present reminders popping up on my calendar; when I experience the constant interruption of phone calls and walk-ins. What do I have to do today to stay focused on the tasks at hand? However, the concept of staying focused begs an even larger question – What is the goal upon which my efforts should be focused?

We can have no focus unless we have clearly defined goals. How can one define tasks upon which to focus when one does not have goals established that allow for a strategic setting of tasks to achieve those goals? In other words, how can we figure out how to get from Point A to Point B unless we understand the location of Point B. Once we know, we can map a route to get there.

I am sure that most of you have seen the SMART acronym.  Goals must be:

S = Specific

M = Measurable

A = Attainable

R = Realistic

T = Timely

While the SMART method is useful, I am "focused" on goal setting at an even more basic level. I was vividly reminded of the need to have goals when I was recently in a meeting with a group of volunteers who assist in the leadership of a charitable organization. Many ideas on programming and how to improve the group were bantered about, all ideas were good, some were excellent! However, the unfamiliar observer might have noticed that the ideas, bright as they were, were also disparate and  non-cohesive in the sense that they did not seem to point to a common interest. One of the participants finally took a step back and interjected: What is the goal of [our organization]? We were flummoxed. All the brainstorming was taking place in a vacuum!

How does this relate to in-house counsel?  Many of us plod through life, day by day, hoping for better, thankful for what we have (as we should be), working hard at our jobs. We consider it a good day when we give some good advice, help a client out of a pickle, solve a problem, proactively manage the company away from trouble, help a friend, whatever. The next day is the same thing. You might call this “surviving” as opposed to thriving. Many of us are fine with just getting by, others need to thrive.

What do you want out of your career? Do you want to be a specialist in a particular area of the law? Are you looking to be the next general counsel of General Electric? Do you want to strike out on your own and use your in-house experience in the private firm setting? Are you looking to back down on the hours and spend more time with the family? Each of these goals demand specialized, differentiated strategies. The tasks required of one goal do not fit within the scheme of tasks required to achieve the other goals.

When goals are clearly identified, we can develop task-oriented strategies to achieve them. By knowing the big picture and focusing on the tasks required to get us there, we have purpose. With each task completed comes a sense of accomplishment, a sense of having done something concrete and worthwhile – because we have inched closer to our goal.

So while the pile of paper may not seem to get any shorter, you can thrive in your career as you accomplish tasks and move forward to your end game. By focusing on the smaller tasks necessary to the achievement of your longer term goals, you make progress. Progress in turn brings a sense of well-being. A cycle is created whereby your goals are affirmed through progress and satisfaction which brings forth more effort to accomplish the next set of tasks and so on and on. Now – stop reading and get back to that stack of paper…..

“People with goals succeed because they know where they’re going.“ Earl Nightingale

Cheap is OUT; Value is IN: Communication and Trust Make it Happen

I have learned that trying to guess what the boss or the client wants is the most debilitating of all influences in the creation of good advertising.

Leo Burnett

I took a bit of liberty in using Mr. Burnett’s quote, applied to the advertising industry.  But the concept, if a word or two is changed out, applies just as well to the attorney/client relationship.  I have learned that trying to guess what the boss or the client wants can be a most debilitating influence in the creation of a healthy attorney/client relationship.

So what does the in-house lawyer client want from her outside counsel? In-house lawyers want VALUE for their money, not cheap fees.  But what does it take to deliver value to an in-house team of lawyers, especially a small law department with little in the way of benchmarking tools and fancy matter management systems?

Upon arrival at a new company, a good in-house lawyer takes some time to learn the business.  The newly retained outside lawyer should follow the in-house lawyer’s lead and do the same. The general counsel should expect the outside lawyer to research the company as much as possible using public sources, then spend some time with the general counsel to learn how she does business; gauge her interests, plans and strategic goals for the department; learn where she (and her department) fit into the business; learn how outside counsel has been used in the past; and find out where she sees the future of the inside/outside “partnership.”

Then it is time to learn how the actual business operates - what does it do, how does it do it?  What are the business weaknesses and where does potential legal exposure lurk? The general counsel should introduce the outside lawyers to the key players in the organization. By this I do not necessarily mean the C-Level folks or even vice presidents. Rather, the general counsel should introduce outside lawyers to the people with whom the outside lawyers will regularly work on matters. The small department lawyer must leverage the business resources to provide the needed information to the outside people so that her day is spent performing legal work, not gathering documents and performing administrative tasks to keep the outside lawyer busy. 

Integral to creating a relationship based on value is developing a protocol for communication between the outside and inside legal teams, one that may include the business people. Word of caution: do not open the floodgate by inviting the business client to call the outside lawyer “any time they have a question.” Your outside legal team will be on the phone constantly with your business people and they WILL bill this time.  So, the inside team should always serve as the conduit for contact with the external legal resources. Open communication will serve the general counsel well in several ways:  She will be personally (or through her team) aware of potential legal issues developing; she will have an opportunity to put an internal resource on the problem right away to try and resolve it before it requires expertise or time commitment beyond that available to her via in-house sources; she will be aware of the matters that her team is addressing; and, billings will be monitored, controlled and minimized. 

A very important element for a value based inside/outside relationship is the development of trust.  Trust is gained on both sides through positive day to day, or issue to issue, experiences. Each side of the relationship must be wholly open and communicative about their thoughts, concerns and expectations. There is a social element to building trust as well. There is nothing wrong with spending down time with your outside firms. However, it would be terribly foolish to compromise your decision making on behalf of your client due to the social interaction you have with your outside firms. Lawyers, though, are particularly adept at keeping business and pleasure separate to ensure such compromises do not take place.

  

As a legal matter develops, it can change, the expectations, goals and expected outcomes and means to the end may need to be adjusted as a result. Neither side should bury their respective heads in the sand and avoid uncomfortable conversations. For a healthy, long-term relationship, expectations and deliverables must regularly be updated to reflect changing circumstances.

 

In closing, let me reiterate the most important points mentioned above – communication with and education about the client, about how the client operates, about expectations and about changing game plans.  Following these elementary rules will go a long way in developing and nurturing a valuable, long term, trusting relationship.

Intellectually Honest Discourse

I love a good argument.  There is almost nothing better than stretching your mind while engaged in an open and honest discussion with someone who views things differently than you do.  It is most fun when engaged in the so-called taboo subjects that are important in a big picture sort of way, such as religion and politics.  These topics evoke deep emotion in people and make the challenge of intelligent and honest discourse all the more interesting.

I have a very good friend who does not share my religious beliefs or my political views.  One might describe the two of us as polar opposites – 180 degrees apart.  The interesting thing about our relationship is that, because of a lot of intellectually honest and intelligent discussion, we seem to have influenced each other on certain matters to within 45 degrees of the other.  In other words, because we are able to discuss very controversial and emotional issues that cut to the very core of our  belief systems in an honest, unemotional and respectful manner, we have brought each other around a little bit to the other’s way of thinking.

The two of us have compromised in the best sense of the word, not falsely by claiming to be in agreement for the sake of keeping peace, but having been truly moved to a new way of thinking about the issue.  This is a wonderful experience.  It is only possible if each of us open our minds to the possibility that we may not be absolutely right about everything all the time.

Having meaningful discussions requires openness, vulnerability, respect and a true and pure willingness to contemplate the argument presented by the “opposing party.”  There can be no sarcasm, no red herrings, no manipulation.  Raw honesty is required.   This is easy to do because there is no end game except enlightenment.  There is no case to win or lose, there is only the opportunity to become smarter – if not about the issue at hand, about how your “opponent” thinks.  Knowing how another who thinks differently than you approaches and analyzes issues will also make you smarter, as you experience a different way of thinking that will help you down the line in other circumstances where there is an end game.

In the “real” world, it is not always easy to be so open and honest about the way one thinks.  As lawyers, we negotiate to get our way.  We start way over here, hoping to end up over there.  We've all played the game, each side makes outrageous demands expecting the other side to do the same.  So we adjust our demands based on the expectations we have of where the other side wants to end up until eventually, after the expenditure of many resources, we end up close to where each side thinks they should be.  Each side walks away believing they got the short end of the deal, grumbling that the other side acted unfairly, complaining about the cost and waste of time, but happy to be done with the emotionally taxing process.  This scenario is played out every day across the world among lawyers, car salesman, commodity vendors, politicians, parents and children, and so on.  This is not the intellectually honest and intelligent discourse of which I speak at the beginning of this column.

Acknowledging the difficulty of acting open minded in an adversarial situation, I invite you as in-house counsel, to try a more open approach with your clients.  Say what you are really thinking, be open to viewing the matter from the perspective of the business person.  Allow yourself to be thoughtfully persuaded by the business to a different way of thinking.  It might not change your legal advice, but it will make you a better lawyer

In Defense of the Older Worker

“How to Bullet Proof Your Career in Your 40s and 50s.” This is the title of an ACC Chicago Chapter Program attended by well over 90 in-house attorneys at the East Bank Club in Chicago. When I heard the title I questioned why, in a lawyer’s prime years, must she think about bullet proofing her career just because she turns 40?

I have always believed, and I am confident that I am absolutely correct, that we become better lawyers with age. Of course this is not simply due to age. Age is a measure of time, not ability. However, as we move through time, we continue to add to our experiences, legal and otherwise. This naturally leads to more personal observations, broader perspectives, situational experiences with outcomes good and bad, substantive and practical knowledge or what I dare to sum up in one word – wisdom.

What is wisdom? The ability to discern or judge what is true, right or lasting, insight, common sense, good judgment, the sum of learning through the ages (Dictionary.com). Over the course of a career, a lawyer is involved in hundreds of situations in which people at various levels within an organization rely upon her to exercise good judgment, avoid pitfalls, maximize profit, provide insight, reduce risk, counsel, guide, sometimes cajole and always protect them from harm. There is no substitute for these experiences in terms of gaining wisdom. No book learning can take the place of actual hands on experience. So then, wisdom is an extremely valuable asset for an in-house attorney to offer her client.

The following words capture the essence of this value:

And if riches be a desirable possession in life, what is more rich than Wisdom, who produces all things? And if prudence renders service, who in the world is a better craftsman than she? … Again, if one yearns for copious learning, she knows the things of old, and infers those yet to come. She understands the turns of phrases and the solutions of riddles; signs and wonders she knows in advance and the outcome of times and ages. Wisdom 8:5-8

Generally, I would guess that practitioners of most occupations benefit from years and years of experience. Who doesn't feel better as they get on the plane when the pilot has a bit of silver in her hair, or when wheeled into the operating room, the surgeon has a slight grandfatherly appearance? But at the risk of offending fellow professionals, lawyers seem particularly well suited to becoming better with age. Of course, age does not equal wisdom, but it suggests it. One can rarely achieve the same level of wisdom without the passing of time as with it, the more the better.

So, I am truly perplexed why any potential employer would look at a seasoned lawyer and believe for a even a moment that she is “too old.” Rather, I would expect that the hiring committee would welcome a bit of silver in the hair, a few wrinkles, an age spot or two. I cannot help but to cite from the Bible once again to make the point:

A great number of wise men (seasoned in-house counsel) is the safety of the world (corporate client), and a prudent king (CEO), the stability of his people (shareholders); so take instruction from my (GC) words, to your profit. Wisdom 6:24-25

Now those are wise words!

Humility

Humility - the quality or condition of being humble; modest opinion or estimate of one's own importance, rank, etc.  Dictionary.com

How can an in-house counsel balance this most important of virtues with her efforts to build confidence in her client that she is trustworthy, her advice competent and her leadership and guidance effective?   Doesn't an effective lawyer have to demonstrate assertiveness (even aggressiveness), boldness, strength and confidence to meet the expectations of her client?

The answer is yes – she must exhibit these traits, but I suggest it must be done from a perspective of humility.  A true humble nature residing in the heart of the lawyer will do much more to build a strong relationship with her clients and help her serve the business more effectively.  To be clear, I do not mean to confuse being humble with being hesitant, reluctant or afraid or in any way lacking in confidence.

  

There is a sure air of confidence and a certain je ne sais quoi surrounding people who are highly effective at what they do, yet are self-effacing.  Jim Collins, the author of “Good to Great”, a recent management book about eleven of the most successful companies in the United States, says, “There is a direct relationship between the absence of celebrity and the presence of good to great results.”  There are many reasons for this according to Collins, but I want to focus in this short space on why humility is a necessary element of success. 

As you contemplate the level of humility you reflect onto others, think about how you view this trait in your peers and colleagues.  Are you motivated by clients or company leaders who are inconsiderate, egotistical, bombastic, grandiose?  Do you champion their cause, give them the benefit of the doubt when challenged, support their initiatives wholeheartedly and honestly?  Or, do you find yourself aligning with people within your organization who are kind, gracious, self-effacing, understated, all the while being highly effective?  I believe the answer is obvious, at least for me.

 

The in-house lawyer has the challenge of performing under the client’s perception of what a lawyer should be (often not a flattering image of the lawyer) and maintaining her professionalism and integrity.   I believe that this can be done by maintaining a servant perspective, reflecting modesty and respect for others and their opinions, but standing strong (respectfully) on issues for which there is no compromise.  None of us have all the answers to every clients every question and we shouldn't act like we do. 

To be effective a good lawyer must be assertive, confident, bold, decisive, and at times strong-willed, aggressive, forceful and sometimes obtrusive.  In doing so she must not give up her kindness, modesty, politeness, professionalism, integrity, respect for others, acknowledgement of authority and understanding that she is not perfect, in a word – humility.  This is a tough balancing act for the in-house counsel.  I encourage you to think and reflect about why humility might be a good thing for you to consider as you approach your clients.    

It takes Great Courage to Do the Right Thing

“Courage is rightly esteemed the first of human qualities... because it is the quality which guarantees all others.”

Winston Churchill

I wrote a column a while back in which I discussed a difficult decision that might one day be faced by every general counsel – whether to “press the button” that could kill their career for the sake of doing what is right or to preserve their future by towing the company line (Courage, Influence and Civility).  Reflecting on this column triggered memories of a past experience at my former company.  In 2002, Spiegel, Inc. was experiencing a perfect storm – SEC compliance failures, alleged fraud on the part of the directors (who have denied any wrongdoing), problems with the company's credit issuing bank and the secured assets it leveraged to generate cash, issues with its lenders and breached loan covenants, a crashing retail environment and defaulting credit card holders. 

I had the privilege of working for a general counsel who walked the walk when faced with the “press the button” decision.  My personal commitment to ethical behavior was affirmed and strengthened through my mentor’s example. 

When Bob Sorensen came to Spiegel in June 2001, it was to be the capstone of a very successful legal career.  He would end on a high note as the GC of a Chicago institution, a grand catalog company with national retail operations (Eddie Bauer) and one of the most lauded internet sites of the time.  With revenues upwards of three billion dollars, Spiegel was one of the big retail players. Sales were strong, or so it appeared, and the company was doing reasonably well. 

However, under the surface, trouble was brewing and it was about to become public. The SEC was investigating Spiegel, the OCC was investigating the bank it owned, outside counsel was forced to “noisily” withdraw from representing the company and sales started to dive.  

So, not long after becoming the General Counsel of Spiegel Inc. in June 2001, Sorensen was put in the unenviable position of guiding a sinking ship through waters fraught with compliance issues.  Rather than set forth the sordid details in this brief column, I refer the reader to the SEC Independent Examiner’s Report (Crimmins Report) – an excellent read and a very good tool to help lawyers gain a real sense of what it means to be faced with a career ending ethical decision.  I strongly urge all in-house counsel to take the time to read the report. 

Sorensen had the good fortune to work side by side with Mike McKillip, Vice President of Audit, who reported directly to the parent’s audit committee in Germany.  Together, these men faced many ethical challenges, the seriousness of which are faced by few people in their careers.  They were subject to intense internal political fallout, peer criticism and potential civil and criminal exposure.  Notwithstanding these pressures, these men never once wavered from their commitment to do what is right. 

Not one year into his tenure, according to the report, German management referred to Sorensen, McKillip and others in U.S. management who repeatedly communicated the troubling situations with the SEC etc. to the board, as “black painters” – pessimists who were exaggerating the seriousness of the situation.  They dismissed their objections as flights of fancy.  It was  suggested that Sorensen be terminated. 

As set forth in the report, when faced with important decisions on corporate action, Sorensen repeatedly insisted on taking the high road at each and every ugly turn.  While this may seem an obvious choice, the report makes it very clear that Sorensen was the leader of a small and distinct minority of U.S. executives who advocated taking the right actions over the objection of senior German leadership.    

Sorensen and McKillip would tell you today that the pressure they faced from the board of directors and the expatriate CEO was so intense that it took years off their lives.  Yet they stayed with the company and insisted on doing the right thing.  Sorensen and McKillip ended up staying with Spiegel to the bitter end, Chapter 11 and the ultimate sale of all assets. 

When their tenure at Spiegel ended, Sorensen retired and McKillip went to work as the Director of Internal Audit for the Evangelical Lutheran Church of America – he used to say that he went to work for God.  McKillip died last September at the age of 59, and I (along with several colleagues) truly believe that his days at Spiegel contributed to his death at a young age.  Both men have inspired many others by way of their honorable and ethical example. 

Mike McKillip was a very good friend of mine and I know that he would not have done anything differently if given another chance, even knowing how it would affect his health.  Among many honorable legacies left behind by Mike McKillip, his unwavering commitment to ethical corporate citizenship is among his greatest. 

What is the moral of the story?  Today’s general counsel often serves as more than just the top legal advisor in a company: trusted business advisor, financial analyst, compliance officer, ethics compass, counselor and advocate.  Because the GC has more than one role, she may face an increase in the number of circumstances that require her to provide ethical or moral analysis and not limit herself to just business or legal considerations. At the end of the day, each of us must be able to look at ourselves in the mirror and be content with who we see.  We, like Sorensen and McKillip, must know that we have done our best to represent our clients zealously, professionally, competently and ethically.  We must ALWAYS do the right thing.

Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, vision cleared, ambition inspired, and success achieved.

Helen Keller 

Intimacy?

“Intimate” might at first seem like a funny word to describe the in-house attorney’s relationship with his corporate client.  But what is intimacy in the context of in-house lawyering?  According to Dictionary.com: Intimacy is “a close association with or detailed knowledge or deep understanding of a place, subject, period of history, etc.”

So, intimacy is really quite an appropriate word to describe the important relationship an in-house lawyer has with his client.  Because of our professional obligations, we cannot help but have a “close association” with our clients. As in-house lawyers, we also strive for a detailed and deep knowledge and complete mastery of our businesses.  

When people ask me why I chose to work in-house, one of the reasons I offer is my desire for a higher level of intimacy with the client - a higher level than can be achieved as an outside lawyer.  As an “embedded” legal executive, I am with the business people on a day to day basis.  I sit with the top executives, participate in policy making meetings and on committees formed to address issues in various disciplines, attend marketing presentations and sales meetings and work closely with the purchasing, risk management, marketing, finance, audit, human resources, accounting departments and the board.  But even more importantly, I have the opportunity to see the warehouse, tour the plant, visit the loading dock and the quality control labs.  An in-house lawyer has a unique opportunity to learn the entire business from the bottom up.

Many companies today require executives to spend time in the manufacturing facility, at the retail store, on the production line, in the research lab, manning the grill or working some other front-line job to help them understand how the business operates.  If your company does not do this, then you should be proactive about doing it yourself.  Knowing the ins and outs of your business is essential in making you a better lawyer for the business.

When you know the business inside out, it is easier to: defend cases, draft contracts that better address the unique needs of your business, appreciate the human resource climate, understand the culture and know what is important to the business.  Most importantly, it becomes much easier to be proactive and provide value in ways the business might not expect from their lawyer.

For example, a lawyer friend of mine from another company was called by the president of one of the operating companies he supports when a customer approached the president about jointly creating a new product.  My lawyer friend's company is not an R&D company; it manufactures a low tech product sold on the commodity market.  Because my friend is embedded in the business, he knows it very well.  His clients, including the president, know how engaged he is and thus regularly consult him on a myriad of legal and non-legal matters.  The president called him as soon as she hung up the phone with the customer.  My friend sat in on the initial meeting with the business folks and the potential partner and was able to identify several very important potential pitfalls that were not even on the president’s radar screen.  My legal friend helped craft an agreement that protected his company from the pitfalls as well as ensure proper ownership in the potentially profitable jointly developed product.

In short, the lawyer who knows his business is a better team member and a much more valuable asset to the company than a lawyer who does not.  In order to be a good team member, the lawyer must be focused on cooperation and coordinate his effort with the group.  Of course, a successful team member must understand how the team works and, ultimately, the final goal of the team.  Becoming “intimately” involved with your business gets you and your team to the goal line and beyond.