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The new General Counsel: It’s legal but is it right?

Tracey Groves

"No two people have the same moral compass, and what the 'right thing' actually means is different for every company."

In the course of my work, I frequently speak with General Counsel - and during these conversations 
I find that two common challenges tend to crop up. While many of them initially think these two issues are separate, they are in fact integrally linked. By joining the dots between them, General Counsel can often address both at the same time.

Making a difference

The first issue is around the voice and influence of General Counsel at the topmost levels of the organisation. Their detailed knowledge, experience and day-to-day interactions across the business, together with their comprehensive view of its legal, commercial and operational risks, mean they’re ideally placed to help the Board and wider leadership make better-informed decisions. When they aren’t getting this opportunity, they quite rightly feel frustrated.

The second issue is around the day-to-day role of General Counsel in supporting the business' development and growth. As the head of the legal team, General Counsel are happy that people across their organisation look to them for robust, reliable advice on what’s lawful and what isn’t. But many General Counsel I meet aspire to do more. As well as providing guidance on how their business can comply with rules, they also want to help it do the right thing in an ethical sense - thus enabling it to generate a good reputation based on trust, strengthening all its stakeholder relationships and licence to operate.

Doing the right thing

Why are these two aspirations linked? Because, in today’s business world, it’s increasingly clear that just because something’s ‘legal’ this doesn’t necessarily mean it’s ‘right’. In fact, an action that complies with the letter of the law may be perceived as wrong or unethical by a significant proportion of wider society. Just think about the current reaction over multinationals’ corporation tax contributions, and how emotive the tax debate has become.

Conversely, companies that go beyond the legal requirements and exhibit values focused on ‘doing the right thing’ can benefit from building deeper trust with their stakeholders. For example, Puma’s creation of an environmental P&L; to reduce its trainers’ environmental footprint, and H&M;’s long-term commitment to paying a living wage in Bangladesh and Cambodia, over and above the minimum pay level set by those countries.

As these examples show, while laws tend to be local, values can be universal. Yet doing the right thing is neither easy nor straightforward: no two people have the same moral compass, and what the ‘right thing’ actually means is different for every company.

The bigger picture

This means that an ability to look beyond legal compliance and grasp the ethical and reputational implications of an action is an increasingly vital attribute for any business leader. And it’s key to setting the right ‘tone from the top.’ So, to fulfil both of their aspirations to be business leaders and the conscience of the organisation, General Counsel need to see further than the traditional ‘black and white’ of legal compliance, and learn to appreciate and articulate the greys and colours of ethical choices.

For many General Counsel, this expansion from rules to values is a major shift of mindset. But it’s the single biggest step they can take to truly elevate themselves to the leadership and gain a voice at Board level.

Read more in our series of articles focused on 'The new General Counsel':

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