Inside Straight: Knowing That Law Wins

Someone in the company is going rogue: The person proposes to do something brazenly illegal, or slightly illegal, or perfectly legal but sufficiently immoral that the conduct would turn any reasonable person's stomach. The rogue is not listening to logic. The person is ignoring everything that your local in-house lawyer is saying. What's the appropriate response from the law department?

Someone in the company is going rogue: The person proposes to do something brazenly illegal, or slightly illegal, or perfectly legal but sufficiently immoral that the conduct would turn any reasonable person’s stomach. The rogue is not listening to logic. The person is ignoring everything that your local in-house lawyer is saying.

When the local lawyer calls the headquarters law department for help, these are the words that headquarters must be able to speak: “Local lawyer, you win. This is not a close call; we should not be doing this. In this situation, I guarantee you that you hold the trump card. Who do you need to make a call to solve your problem? The general counsel? The chief financial officer? The CEO? Someone else? We will cause that call to be made in a heartbeat. What do you need?”

Is that what people mean when they talk about “tone at the top”?

I suppose that’s one part of “tone at the top,” but, for lawyers, it’s the imperative piece.

If a local lawyer calls for help, or if you personally need help, from one of the folks who runs the joint, you must know — definitively know, without question, and without having to ask in advance — that law wins. Armed with that confidence, everyone can do their job: The local lawyer can speak with authority to the local business folks; the global lawyers can speak with authority to people in finance, human resources, IT, or a business unit; and the law department can maintain its appropriate independence.

If there’s even a whisper of doubt as to whether law wins, the game is over. The local lawyer may be reluctant to give strong legal advice (for fear that her job may be at risk); others may choose not to butt heads with senior people who are indifferent to the primacy of law.

Sponsored

There’s a flipside to this: The law department cannot abuse its authority. The law department cannot forbid things that are legal and appropriate. The law department cannot be formal and ritualistic when a problem demands a pragmatic business solution. The law department must work with business people to help them solve their legal problems. Law cannot be “the department that says ‘no.'”

I’m delighted to say (and perhaps public flattery will gain me something) that I live in an environment that’s right. We can, and do, regularly tell our lawyers: “You win. Who do you need to make a call?” Typically, after we fortify our local lawyers in that way, there’s no need for anyone to make a call. Armed with confidence, our local lawyers are able to resolve matters on their own.

I occasionally hear from in-house lawyers at other companies that those lawyers are not confident that law will always win. I’m delighted that I personally don’t have to confront that problem; it would be a bear. In fact, it could easily be a bear that would compel looking for a new job.

The law department must have absolute confidence that everyone in senior management is committed to acting ethically and lawfully. Armed with that knowledge, people in the law department can speak with authority: Everyone knows that, at the end of the day, law wins. Stripped of that knowledge, the resulting slippery slope may ultimately lead an entire organization into the abyss.

Earlier: Inside Straight: If Law Don’t Get No Respect

Sponsored


Mark Herrmann is the Vice President and Chief Counsel – Litigation at Aon, the world’s leading provider of risk management services, insurance and reinsurance brokerage, and human capital and management consulting. He is the author of The Curmudgeon’s Guide to Practicing Law (affiliate link). You can reach him by email at inhouse@abovethelaw.com.