As the perception of the General Counsel role shifts increasingly towards that of a strategic advisor, in-house lawyers are playing an ever more significant role in the C-Suite. Twenty years ago GCs had minimal power or influence within a business, however as companies come to realise the value of the GC’s insight and guidance, they are taking on more and more roles within the C-Suite. However, that being said, relatively few ever make it to becoming CEO.
A study from KMPG and Reed Smith, ‘Leadership beyond the law’, found that in the ten years from 2002 to 2012 the number of FTSE 100 CEOs with a legal background, that is either studying or practicing law, rose from three to seven. This increase is illustrative of the growing strategic importance of GCs, however that figure is still dwarfed by the number of CEOs who have a background in accountancy and engineering.
Not every legal professional wants to be a business leader outside of the legal discipline, however with the trend of ‘lawyers as leaders’ on the rise, why aren’t there more CEO’s who have climbed to the top through the legal department? Many of the qualities often associated with leadership roles are also qualities possessed by General Counsels; strategic thinking, focus and vision all contribute to the making of a successful CEO. However, a common concern for many is the ability of lawyers to transition from being ‘risk averse’, a view widely taken of legal professionals, to ‘risk informed’ – a vital factor in leadership.
A number of private practice firms including Simmons & Simmons and Eversheds have incorporated aspects of MBA-style training into their junior lawyers training programs. There are a number of factors, however, that GCs should consider if they are aspiring towards reaching CEO. It’s vital that leaders have a broad perspective on important issues; lawyers are trained to focus on the details, so they need to ensure they adopt a wider business perspective. Knowing the business is also key, many GCs are ingrained within a company, but they need to make sure that they understand everything from business models to company culture. Perhaps most importantly they need to fine tune their numerical skills as they don’t have as integral an understanding of finance as Chief Financial Offers who might also be vying for the top role, and therefore it’s vital that they are able to grasp and apply mathematical skills in business.
The number of FTSE 100 CEOs who are also lawyers will no doubt continue to rise as their skills diversify and more businesses come to value their strategic insight. Aspiring in-house professionals must continue to work to develop their wider business skills if they want to make it to the top.