What does it mean to be an in-house counsel these days? The profession is agreed that the job carries considerably better status and prospects and attracts a better calibre of lawyer than 10 years ago. There is, in addition, widespread consensus that general counsel now operate much more closely to the business, moving beyond their role as narrow managers of legal risk.
Understandably, this progress is celebrated but, as we address in our annual in-house lawyer survey, this sea-change has not been accompanied by much discussion of the implications for the ethical standards and potential conflicts inherent in a brief that now takes lawyers much closer to the sharp end.
After all, getting to the heart of the business is a difficult balancing act for lawyers with professional obligations separate to the profit-seeking motive of their employer. Yet it’s striking that there has been so little focus on how these expanding risks should be managed as in-house counsel are called on to carry out more duties that would have once gone to external advisers and now that the peer pressure to behave commercially risks divorcing lawyers from their professional grounding.
In many senses, however, the storm clouds are gathering. There have been a string of corporate scandals in recent years in which in-house counsel have been caught up unhappily while recently news emerged of two senior in-house counsel at a major bank being interviewed under caution by the Serious Fraud Office, including the former group GC.
Many of the senior GCs we interviewed for the survey concede their personal risks are rising along with their expanding briefs – some go further by admitting that there has been a complacency regarding this direction of travel as the resounding mantra to ‘be commercial’ drowns out other considerations. How often do we hear in-house counsel proudly talk of co-workers in the business forgetting that they are a lawyer? On one hand that is understandable pride in their wider contribution but on the other that is an ambiguous dynamic that obscures why lawyers are actually there.
As LBC Wise Counsel‘s Paul Gilbert points out, there is highly prescriptive regulation for alternative business structures, yet little in the way of vetting for companies to employ lawyers nor much development of in-house-specific guidance in recent years.
The boosterish view of the upwardly mobile modern in-house counsel is not – in itself – a satisfactory response to the changing responsibilities the job now entails. With little sign of such a serious examination, the chances are that the profession will be learning the hard way the full risks taken when people start going to jail.