10 Things To Know About Capital Markets And Corporate Governance Practice

Welcome to Better Know A Practice Area, a new monthly series introducing readers to different practice areas.

meeting business meeting sign signing signature meet and conferEd. note: Welcome to the first installment of Better Know A Practice Area, a new monthly series introducing readers to different practice areas. Each post is written by an editor at Practical Law who previously practiced in that area and currently writes about it. We hope that this content will be interesting and useful to law students and young lawyers figuring out their career paths.

  1. What do you do in a typical day?

It’s hard to describe a typical day for a capital markets and corporate governance lawyer; even seemingly routine transactions always have unexpected problems to be solved. That can be stressful in the heat of the moment, but facing unique challenges regularly is what makes the job so interesting and, of course, makes for a better lawyer.

When in the middle of a transaction there will be a mix of organizing and guiding the client through the process. There will also be drafting, reviewing drafts from the other side, and a great deal of negotiating key contracts and disclosure documents among the client and the other side with their counsel. If the issuer is new, the lawyer will also want to spend time learning what they do and what their key metrics are, both from those at the issuer directly and from external sources.

Throughout the year lawyers in this practice area also help issuers draft their annual, quarterly, and periodic reports that are filed with the Securities and Exchange Commission. This requires staying current on SEC rules and understanding the issuer’s competitive marketplace and the evolving risks to its business. These reports are extremely important to all public companies and comprise the foundation of how they officially communicate with their shareholders and the capital markets.

  1. Who do you work with?

Lawyers in this practice area work with internal partners and the deal team particular to each transaction, which may include specialists in particular areas (for example, tax, intellectual property, environmental, and executive compensation experts). They will also work with a variety of people working internally for the clients, including the in-house legal team, executives, and boards of directors.

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These lawyers will work with the client’s auditors and regulators (including the SEC), securities exchanges, and various other financial regulators. There will be regular contact with counsel and business people on the other side. With these various groups, capital markets and corporate governance lawyers have the opportunity to see plenty of different perspectives and angles, so there is much to be learned and many personalities to navigate.

  1. What does a common career path look like?

It is common to gain experience in large law firms for several years, gradually taking on more responsibility and learning to manage transactions and become the point person for a client to come to. From there, a lawyer may move into the partnership track or stay with the firm in a non-track role. It is common to move on to practice at a smaller law firm and very common to take a position as in-house counsel.

  1. If variety is the spice of life, how spicy is this practice area?

Representing public companies affords the opportunity to see many types of issues, from complicated financings and related M&A transactions, to deciding how or whether to disclose sensitive issues, to helping structure a company’s corporate governance regime. It is a great practice area if the “never a dull moment” thing is appealing to you. This is especially true if the lawyer has the opportunity to work at a firm or company where he or she is trusted to work on cutting-edge issues.

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It’s very important for capital markets and corporate governance lawyers to do their best to manage their own career and work with different clients in different industries on a variety of issues. This certainly gets easier with seniority. It is also beneficial for lawyers to have a few regular clients that come to them for everything. It provides opportunities to encounter many different questions while gaining intimate knowledge of their business and culture. This is great experience for a future in-house counsel.

  1. How much wear and tear?

A capital markets and corporate governance lawyer may be working on a securities financing transaction, helping a company communicate appropriately with the market and its customers, or guiding corporate governance best practices. These are all very important issues to a company with high stakes and, accordingly, the pace of work will be fast and expectations and pressure high.

However, working on these vital topics is what makes the job exciting. Wear and tear also comes from an inherent lack of predictability when working on important issues with high expectations. Striking a balance is certainly something lawyers have to work at.

  1. Of the people in this practice group who hate it, what exactly do they hate about it?

Lawyers in this practice area have to really enjoy the work, or the “wear and tear” as you call it can catch up with them. That’s likely the biggest complaint. Lawyers have to feel that it is worth the sacrifices they make. It’s an intense job. Lawyers have to give a lot to it and they get a lot in return. Of course that is not for everyone.

  1. Of the people in this practice group who love it, what exactly do they love about it?

The variety is certainly part of it, always being intellectually stimulated. Working on transactions and matters that are of utmost importance to clients is also very fulfilling professionally. There are times when a lawyer will be working with a company and its future is literally on the line. The challenges can be exhilarating and there are always learning opportunities.

  1. Are there common avenues out of this practice area?

Working in this area positions lawyers very well to go in-house to public companies where they would continue to counsel on corporate transactions as well as corporate governance. Broad experience with different industries and business units can also position lawyers for various non-legal business roles within a company. It takes very good judgment to be a successful capital markets and corporate governance lawyer and that translates well into many areas of general business judgment.

  1. What are some market trends that impact this practice area?

Of course, the financial markets themselves are primarily impactful. Business cycles and credit markets create booms and droughts.

Periods of increased activity can give junior lawyers the opportunity to run their own deals earlier than normal as resources are spread thin. Alternatively, downturns afford the opportunity to work on novel transactions as market participants must get more creative.

Finally, the business cycles lead to alternating periods of deregulation and then increased regulation. Good examples are the Dodd-Frank Act and the JOBS Act; both have kept capital markets and corporate governance lawyers extremely busy for some time now.

  1. If you had to recommend one candidate from a room crowded with recent bar exam graduates, what specific qualities would he or she have that would ensure success in this practice area?

Both the ability and the desire to counsel clients with as much or even more focus on business judgment and their business advancement as any of the purely legal topics or skills they learned in law school.

Whether a lawyer is in-house or part of a firm, it is essential to consider himself or herself as part of the business team, but bringing a unique and essential skill set to the table. This perspective can help lawyers move from saying “that’s too risky, we can’t do that” to “here’s how we can best accomplish our goals while minimizing our risk.”


Jerry CarannanteJerry Carannante is a senior legal editor on Practical Law’s Capital Markets & Corporate Governance team. He joined Practical Law from Sullivan & Cromwell LLP where he specialized in a variety of complex corporate finance transactions and general corporate matters.