KPMG report reveals an urgent demand from C-suite for General Counsel to advise on business strategy
C-suite and senior management are demanding that General Counsel have a greater influence on strategic decision making and facilitating growth, according to a new in-depth report.
The new research, entitled ‘Through the Looking Glass’, involved 34 interviews with business leaders from around the world, from Board members to Chief Executive Officers, about their perspectives on the role of the General Counsel and in-house legal teams.
The findings show this has broadened significantly with General Counsel increasingly expected to influence business strategy rather than strictly dealing with legal matters. This shift is being driven by a growing number of technology risks with potentially business-wide threats, such as cyber security, together with a desire to create competitive advantage through regulatory change.
Kathryn Britten, the KPMG partner who has led KPMG’s General Counsel Programme and this research commented: “General Counsel have a holistic view over a business that is often unique. Supplemented with their legal expertise, they are ideally placed to take a proactive role in advising the company on risks and opportunities. It’s therefore not surprising to see an increased urgency from senior management for the role to take a more central seat, with General Counsel’s advice becoming integral to business strategy.
“The new opportunities and risks provided by technology are a key driver behind the trend, with the C-suite demanding greater strategic input on topics such as cyber security and social media which are now business-wide issues. Together with providing insights on technological change and compliance, General Counsel are also uniquely placed to advise how and where regulation will change in the future, and thereby can help their businesses to gain a competitive advantage.”
KPMG has been conducting research into the developing role of General Counsel for many years, however the new report represents the first time the firm has canvassed views outside the legal profession.
The research found mixed opinions among interviewees on the relationship between General Counsel and the Board. Most argued that General Counsel would lose their independence if they were members of the Board, but almost every interviewee felt it was necessary for the General Counsel to attend Board meetings.
Annabel Reoch, UK Head of Anti-bribery and Corruption at KPMG, commented: “Our research shows there’s an increased demand for General Counsel to translate strategy into a workable framework within regulatory environments and deliver business insights based on what is permitted by law. The findings of the research provide an opportunity for General Counsel to gain a greater insight into expected changing demands of the role and several takeaways to help them to focus the activities of the in-house legal team to address the Board’s expectations.”
Based on the research, KPMG has developed a roadmap for the shift in the General Counsel’s responsibilities, detailing the five new areas which form the new norm:
- Business leader: providing insightful commercial advice to the other senior executives and the Board, based on sound legal principles.
- Risk manager: Being constantly alert and vigilant to an increasingly broad array of global threats to the company, and handling them accordingly.
- Technology champion: Leading the change in mindset, from technology as a standalone,isolated specialism; to the all-pervasive reality of doing business in the digital age.
- Key communicator: Adeptly dealing with key stakeholders such as the Board and investors, as well as effectively communicating with regulators and internal teams.
- Building of corporate culture: Setting a tone of trust at the top and building a risk-aware culture in which compliance is not seen as a straitjacket, but as a source of competitive advantage.
Peter Lappin, Citypress (on behalf of KPMG)
T: 0161 235 0328
David Bertram, Citypress (on behalf of KPMG)
T: 0161 235 0316
KPMG press office: +44 (0)207 694 8773
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