During the International Bar Association’s recent annual conference in Seoul, the In-House Counsel Forum (IHCF) organized a lunch for its members, partners and the many in-house counsel from around the world who had attended. The keynote speaker was well known legal academic Professor Eunice Kim, who shared her past experiences during the ‘age of outside counsel’ to a new era, which she says is a complete transformation. We edited her speech for readers of Asia Business Law Journal
I have worked in different roles and capacities in the past 30-plus years, and even though I worked in-house for only 15 out of those 30-plus years, I still think of myself as an in-house counsel. I am in my 10th year of teaching at Ewha, but I still introduce myself as a professor with a past – that I worked in-house in my prior professional life.
So, I have to admit that it is hard for me to get the in-house identity out of me just yet. Maybe more decades need to pass before that happens. I still find that whenever I meet another in-house lawyer, I have an immediate affinity and connection, at least on my part.
As an aside, I was one of the founding members of IHCF – I always knew this group would grow in leaps and bounds, but what actually happened far surpassed my wildest imagination. IHCF today has become the go-to organization for all in-house lawyers in Korea that provides excellent training and networking opportunities, like this event today.
What I want to share with you today is something that all of you already know – that the age of the in-house counsel has finally arrived, and is here to stay. That is certainly my conjecture, and more importantly, the conjecture of many experts. What we are seeing is the rise of in-house legal departments in virtually all sectors and industries, and the transformation of the law firm practice (private practice) to accommodate the changing role and demands of in-house counsel.
Let’s quickly review how it used to be in the age of the outside counsel – I can tell you from my personal experience as this is an age that I lived through:
- Intermediary role: Little value-added. The common perception was that in-house counsel acted merely as intermediaries, who added little or no value. Many people also thought that real expertise resided with outside counsel.
- Does not understand business: Lonely in the legal silo. Another view was that in-house counsel did not understand business, remained lonely in the legal silo, were not integrated with their business, were uninvited to meetings, especially in the planning stage, and were unapproachable because they spoke “legalese”, and were possible deal preventers who said no.
- A walking cost centre: Keeping it small and cheap. With one-lawyer internal legal teams, there was a vicious cycle of dissatisfaction from business departments with inexperienced in-house counsel, and the same the other way around. There was no need for the company to pay good compensation salary, and so mediocre compensation applied for in-house counsel.
- Passive and less ambitious. In-house counsel were seen as passive and unambitious, and with uncertain long-term career prospects.
- Limited mobility options. This was often the case both inside and outside the company.
- Long-term job security? Any form of long-term security as an in-house counsel was either uncertain or unlikely.
- Cul de sac: Promotion unlikely. In-house counsel positions were deemed as the last job before retirement. If you moved from a law firm to an in-house position, then you were seen as someone on his/her way out of the legal profession.
- I can share a personal story with you. In the mid-1990s I worked for a joint venture asset management company that I helped set up. In-house lawyers were such a rarity at that time that people did not think it would be a viable career option.
My colleagues at that time were also worried that I would not last longer than six months at the firm, and that I would be asked to leave after the initial set-up phase since there would be no work for me to do.
They advised me to either join a law firm or return to Hong Kong or New York, where my New York bar membership would mean something. I was also a bit concerned since there were not many in-house counsel like me when I looked around. There was just a handful of us, who were getting together from time to time, and who eventually became the founders of the IHCF after a few years of informal gatherings. IHCF today is the go-to organization for in-house lawyers that provides training, networking and job opportunities.
My colleagues’ concerns turned out to be unfounded fears, as I not only had too much to do, but also was promoted every year, and eventually became the COO of the company, with all middle and back office functions reporting to me.
Now, enter the age of the in-house counsel, the legal profession’s biggest and fastest growing segment.
In-house counsel are valuable and strategic business partners. They are trusted and respected, and they live and breathe the business and understand its legal issues, sometimes even better than the front office. As a result, in-house counsel today give practical and relevant advice. They can also prioritize and juggle many issues efficiently because they understand the big picture and still can pay attention to details. They are also consulted much earlier on, rather than after problems have arisen, as was the case in the age of outside counsel. Accordingly, they are better legal risk managers because they understand the business and know when to be firm and when to be flexible.
There are also larger in-house legal departments. Many companies now have big legal departments comprised of both generalists and specialists. Many of these large teams are well-equipped to train junior lawyers, sometimes from scratch.
In-house counsel today have a revenue-focused frame of mind, and know how to mobilize and obtain the best value out of available legal resources, ranging from in-house lawyers and non-lawyers, outside counsel and non-legal expertise. In the age of outside counsel, a lion’s share of the legal budget was spent on insourcing, as opposed to outsourcing. General counsel now also know how to supervise outside experts to obtain the best value out of the legal budget.
In-house counsel are not only interdisciplinary problem solvers and responsible decision-makers. Unlike outside counsel, whose role is to give advice, in-house counsel often make decisions for which they can take credit, and are held responsible.
Versatility, flexibility and innovative multi-players and jugglers define the new roles. Some in-house lawyers also play non-legal roles such as negotiating, communicating and gatekeeping.
Being effective enablers, facilitators and managers of outside counsel, in-house lawyers now help outside counsel to provide relevant advice by getting them to focus on the right issues, and providing the context in which issues arise. They know the strengths and weaknesses of outside counsel.
They are also immensely adaptable, with unlimited professional mobility to other departments within the company, especially the front office. In-house lawyers interface with the front, middle and back office, and are often invited to join them as a member of the internal client unit.
In addition to the front office, they often make the jump to units such as compliance, internal audit, risk management, strategy, HR, corporate secretary, government relations, external communications, public relations, corporate social responsibility, disclosure, etc.
This mobility to companies in similar, related and unrelated industries, as a skill set of in-house counsel, is transferable and relevant to companies in other industries. Former in-house counsel make great outside counsel, since they understand the inner workings of client corporations, and the expectations of in-house counsel.
And their mobility applies to anywhere. Nothing is off limits. The licence to practise law should not be an opportunity-limiting factor. Since in-house counsel have a deep understanding of business, they can positively consider career moves outside the legal role when the right opportunities present themselves. The courage to look beyond the legal profession can lead to enriching and meaningful roles. Working in a non-legal role does not mean you failed as a lawyer – it means just the opposite.
The myriad of possibilities that lay beyond the legal profession are almost limitless. You can become a business leader, join regulatory and law enforcement authorities, conduct policy-making and legislative activities, involve yourself in academia and research thinktanks, serve on corporate boards, serve in public interest areas such as government committees, NGOs, NPOs, international organizations, civil society, etc., run your own law practice, start your own business. You can do anything.
There is a whole new world of options, opportunities and expanding horizons, all of which can be immensely rewarding and enriching experiences. There are key influencers, within and outside the company. You can be the company’s brain, heart and conscience, pondering issues beyond law and regulation.
But never lose sight of the public good – do the right thing, enjoy your work, and soar to new heights. You are in the best place in the legal profession – use it to make the world a better place.
Professor Eunice Kim is a Yale-educated lawyer who currently works at Seoul’s Ewha Women’s University as a professor of law. Prior to that she held positions including: Deputy CEO, chief compliance officer, chief legal officer at Hana Financial Holding; Managing director, chief compliance officer at Citibank Japan; Executive vice president, managing director, chief legal officer at Citibank Korea; COO, Franklin Templeton Investment Management; and associate attorney at Simpson Thacher & Bartlett. She was a founder of the In-House Counsel Forum.