When it comes to business development, there may be no bigger “whale” for an attorney to land than the Chief Legal Officer (CLO) at a thriving company.
Yet, many lawyers still don’t completely understand what a CLO is, what they do, and — perhaps most importantly — what they’re looking for when choosing outside counsel.
This article aims to answer those questions for you.
In a nutshell, CLOs operate beyond the traditional confines of legal advice and litigation. Within their respective companies, these legal experts are pivotal in shaping business strategies, ensuring compliance, and steering businesses through the maze of global regulations.
And, if you’re lucky enough to attract one to your law firm, they can become valuable client liaisons for years on end.
So, let’s explore the ins and outs of the CLO position.
The role of a Chief Legal Officer
A Chief Legal Officer serves as the pinnacle of legal authority within a corporation, generally overseeing all legal aspects of the business.
The CLO is tasked with safeguarding the company’s legal health and avoiding legal pitfalls while simultaneously ensuring that the company remains on the right side of law and ethics.
This role, often seen as a step beyond the traditional General Counsel, includes a broad swath of responsibilities – from legal compliance and risk management to strategic planning and corporate governance — all of which we’ll cover below.
Private lawyers need to understand that the CLO’s job is unique. Unlike other legal positions within a business that might focus solely on litigation, compliance, or contracts, the CLO’s role is inherently strategic.
They are integral members of the executive team, bringing a legal perspective to business decisions, and ensuring that legal strategies align with corporate goals. In that capacity, they’re also key decision makers when it comes to hiring outside counsel.
Key responsibilities of a CLO
The duties of a Chief Legal Officer are diverse and encompass various facets in the operations of both legal and business domains. Here’s a closer look at the key responsibilities that define the role:
Corporate strategy and governance
CLOs play a crucial role in shaping and guiding the corporate strategy. One of their key duties is to ensure that legal considerations are woven into the fabric of business planning and execution.
As such, they work closely with the board of directors and executive team to develop governance practices that not only comply with the law but also promote ethical business practices and (hopefully) increase shareholder value.
Legal risk management
Another primary duty of a CLO is to identify, assess, and manage the legal risks associated with the company’s business activities.
In this role, they continuously and meticulously analyze potential threats that could arise from contractual disputes, litigation, intellectual property issues, and regulatory non-compliance, among other areas.
They also develop and implement risk mitigation strategies that might include revising contractual agreements, enhancing corporate policies, conducting legal audits, obtaining appropriate insurance lines, and facilitating employee training on compliance matters.
Compliance
Ensuring compliance with local, national, and international laws and regulations is a cornerstone of the CLO’s responsibilities. This is no small undertaking.
Companies with CLOs often find themselves in complex regulatory landscapes.
These can include financial regulations, such as the Sarbanes-Oxley Act for corporate governance and financial practices, or data protection laws like the General Data Protection Regulation (GDPR) in Europe or the California Consumer Privacy Act (CCPA).
They’re also charged with knowing industry-specific mandates such as the Health Insurance Portability and Accountability Act (HIPAA) for healthcare privacy and security.
It’s the CLO’s job to see that the company not only meets current legal requirements but is also prepared for changes in the regulatory environment.
In this way, it’s their job to safeguard the company against legal and reputational risks associated with non-compliance.
Contract negotiation and management
CLOs oversee the negotiation, drafting, and management of contracts, ensuring that they protect the company’s interests while maintaining fairness and compliance; including everything from employment contracts to complex merger and acquisition agreements.
Intellectual Property and patent strategy
In companies where intellectual property (IP) is a critical asset, CLOs are responsible for developing and implementing strategies to protect and exploit these assets.
This includes managing patent portfolios, overseeing IP litigation, protecting trade secrets, and advising on the legal aspects of innovation and product development.
Crisis management
CLOs are often at the helm during corporate crises, providing leadership and legal advice to manage situations that could potentially harm the company’s reputation, financial health, or legal standing.
Their expertise is crucial in navigating the intricacies of legal and reputational risks in times of crisis.
Importantly, Chief Legal Officers also play a key role in coordinating with external legal counsel, public relations teams, and regulatory bodies to ensure a unified and strategic response.
They manage the communication strategy to mitigate negative publicity and legal consequences while also working internally to address and rectify the root causes of the crisis.
This comprehensive approach ensures that the company not only navigates current challenges effectively but also emerges with its integrity and stakeholder trust intact.
How to attract CLOs as clients
Attracting CLOs (or, rather, their employers) as clients is a strategic endeavor that requires a thorough understanding of their needs, challenges, and the value they place on outside legal counsel.
For law firms and private lawyers aiming to serve at this level, positioning yourself as a trusted advisor rather than just a service provider is key.
Here are actionable strategies to attract CLOs as clients:
Demonstrate industry expertise
Let’s be honest: unless you’re at a giant firm with endless resources, it’s a fool’s errand to try to attract CLOs from a broad swath of industries. CLOs value legal partners who possess deep understanding of their industry’s unique challenges and opportunities.
Specializing in specific sectors and demonstrating thought leadership through articles, webinars, and speaking engagements can set you apart as an expert who can add real value to their business.
Offer customized strategic solutions
Just about any run-of-the-mill lawyer can offer legal advice. To differentiate yourself or your firm, try to go beyond traditional legal advice by offering strategic insights that align with the company’s business goals.
CLOs are looking for partners who understand their specific business and the context in which it operates. In short, they want someone who can contribute meaningfully to their unique and strategic decision-making.
Leverage personal networks
Building and nurturing personal relationships remains at the heart of attracting high-caliber client contacts like CLOs.
Attend industry events, participate in legal forums, and engage in platforms where CLOs are likely to spend their professional time. That said, personal referrals and word-of-mouth recommendations are often the most effective channels.
Showcase your success stories
Share case studies or success stories that highlight how you’ve helped companies in their industry (or similar industries) navigate complex legal challenges successfully.
Proof of your ability to deliver results resonates well with CLOs, who are results-oriented by nature given that they serve at the leisure of the Board of Directors.
Be tech-savvy
Show that you’re at the cutting edge of legal technology, whether through your use of case management tools, data analytics, or cybersecurity measures.
CLOs appreciate partners who can leverage technology to increase efficiency and reduce risks. Again, these are the folks sitting with the Board of Directors trying to justify your fees.
If you can show increased efficiencies through the use of technology, you’ll have a leg up over the Luddite firms that are also trying to win their business.
Working with a Chief Legal Officer
Now that you’ve convinced a CLO to work with your firm, understanding how to effectively maintain the relationship is paramount.
Building a productive relationship with a CLO requires an appreciation of their broad role and strategic priorities.
Here are some insights on how to collaborate effectively:
Understand the business context
To provide valuable legal advice, it’s crucial to get to know and understand the business’s strategic goals and the industry it operates in. This knowledge enables you to align your legal advice with the company’s objectives and the CLO’s strategic approach.
Communicate clearly and concisely
CLOs often juggle multiple responsibilities and decision-making processes. Clear, concise communication that gets straight to the point is highly valued. Provide actionable insights and recommendations that facilitate informed decision-making.
Be proactive about risk management
Anticipate potential legal issues and bring them to the CLO’s attention with proposed strategies for mitigation. Proactive risk management is a key area where private lawyers can add significant value.
Foster a collaborative approach
Collaborate closely with the CLO and their team, ensuring that your legal advice complements the internal legal strategy.
While it’s okay to bring differing legal opinions to the table when warranted, outside counsel’s actions must generally align with the internal team’s efforts.
Adapt to the company’s culture
Each company has its unique culture and way of doing things. Understanding and adapting to this culture can enhance your working relationship with the CLO and the broader executive team.
At the end of the day, understanding and engaging with a CLO goes beyond mere legal proficiency. It demands a strategic partnership where insight, innovation, and alignment with business objectives are more important than tee times and cocktail hours. By focusing on the unique role they play within businesses, attorneys can forge lasting relationships with CLOs — and greatly increase their firm’s bottom line.
