A new study by Global Law firm Clyde & Co, in partnership with Winmark, has found that, in response to the increasingly complex and volatile risk matrix they face, nearly nine in ten General Counsel (GCs) (88%) see managing uncertainty as a key part of their role.
The Looking Glass 2017 which surveyed GCs and board directors, demonstrates how the perception of the status, role and effectiveness of the GC within organisations varies between GCs and their boards, and how the GC function is evolving.
While board directors and GCs have a similar view of the risk that affects their organisations, their perceptions diverge when it comes to the factors driving change in the GC role. The survey shows that board directors see less change and tend to define the GC role more narrowly, underestimating the share of time GCs spend on strategic projects.
While GCs and boards agree that economic, technological and political risks are the most high-impact risks facing their organisations, they are not aligned on how important managing uncertainty is to the role, or how effective they are at this task - 68% of GCs feel that they manage uncertainty well, while only 38% of board directors believe this to be the case.
Perhaps recognising the huge challenges facing them externally, boards and GCs are very closely aligned on the central importance of securing legal and regulatory compliance, with 94% of all respondents in both groups seeing it as an important feature of the GC role.
As John Jeffcock, Winmark's Chief Executive, observes: "Regulation has crept up to the top of the boardroom agenda and has become a major strategic influencer. This enables GCs for the first time to play the leading role in strategy. The report identifies the current differences between how the board perceives the GC role and its performance, and most importantly how to close the gap."
Simon Konsta, Senior Partner at Clyde & Co, says: "This report shows that at every level, the general counsel role is being reinterpreted and reaffirmed in light of the changing risk and regulatory landscape that businesses face. Because of these changes, the successful, modern, general counsel must deploy a blistering array of commercial, legal and wider business skills on a daily basis."
The report also finds that:
- Specific legal and regulatory developments are seen as the key factor driving change in the GC role by both the boards (56%) and GCs (72%).
- Boards think that the GC role is far more functional than GCs do, with board directors believing that 33% of a GC's time is spent responding to internal legal requirements, while GCs report that this is actually just 19% of their role.
- GCs and the board both agree that GCs need to improve on empowering the wider business through tools and training and leveraging technology to enhance the service on offer.
A full copy of the Looking Glass Survey 2017, which is based on interviews with 100 in-house legal leaders and 18 board directors, as well as desk research and in-depth consultations with 19 experts, is available here.
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