Elite in-house counsel once ruled the legal profession. A century ago, you wouldn’t have found the most powerful and prosperous lawyers in private practice. You’d have found them inside the banks, oil companies and railroad concerns that dominated the North American economy. In the 1940s, however, that hierarchy started to break down. Large companies had become complex bureaucracies with specialized divisions—finance, sales, operations—led by a new crop of business school-trained professionals. “The old model of the wise general counsel, steeped in practical wisdom but ignorant of new business-related bodies of knowledge, no longer fit the emerging management style,” according to a paper in the Fordham Law Review that recounts this period. Executives no longer trusted corporate counsel to handle anything but “narrow, routine legal questions.”
Instead, the corporate world sent the bulk of its legal work to private law firms, which had built up an army of skilled lawyers who understood modern business practices. The partners who ran those firms swiftly rose to the top of the legal pecking order. Not until the 1970s did the general-counsel position regain some of its bygone influence. Governments at all levels had passed a staggering number of regulations in dozens of industries. Big Law benefited enormously, racking up untold billable hours as it helped clients comply with the new regime. But companies soon balked at the skyrocketing cost of external legal advice. General counsel, long confined to the sidelines, now had an urgent task: get that spending under control.
So began an astonishing comeback. General counsel carefully monitored their legal budgets, supervised the work of outside law firms and reclaimed long-lost institutional authority. Fast-forward to today. In-house legal teams have ballooned in size—surpassing, in some cases, 1,000 lawyers at offices around the globe. Meanwhile, as the Fordham paper puts it, corporate counsel serve as trusted “advisors to senior management and, often, the board of directors.”
In other words, the demands on in-house lawyers have never been so high. Companies now depend on corporate legal departments to handle a broad range of matters: routine contract negotiations all the way up to advanced litigation strategy. It’s no small feat to thrive in such a high-stakes environment. But it’s achievable. What follows is a practical guide on how to succeed in the vast universe of corporate counsel.
A perfect starting point
For decades, the central path into the realm of corporate counsel has remained remarkably stable: launch your career in private practice, hone your skills as an associate and hit the job market with a track record of competent legal work. According to one industry report, companies rarely hire lawyers who’ve spent fewer than four years at a law firm. Recent calls simply need too much training and supervision. That’s the blunt truth.
You can seek out a junior in-house position in all the usual ways—by scanning a job board, contacting a legal recruiter or asking your network to tell you about hidden opportunities that will never appear in a public listing. Before you apply to a particular role, keep this principle in mind: in the kingdom of corporate counsel, the generalist outranks the specialist. In a single week, a top in-house lawyer’s workload might touch on contract review, corporate litigation and regulatory law. Companies tend to promote legal talent with a knack for that sort of professional range. It’s in your long-term interest, therefore, to begin your in-house career in a role that puts you in close contact with a variety of practice areas.
Your job title matters, too. When you join a legal department as counsel—the lowest rank in the chain of command—you’ll receive a decent amount of time to familiarize yourself with the work and enjoy a modest level of mentorship. Newly hired senior counsel, by contrast, have to contribute right away, with minimal direction. Simply put, don’t take on a title unless you can live up to it.
The risk factor
You’ve now landed an ideal entry-level position. In short order, the veteran lawyer you report to hands down a seemingly straightforward assignment: provide feedback on a contract. You may feel inclined to showcase your brilliance by identifying dozens of subtle legal issues. If you act on that impulse, though, here’s what your boss is likely to say: “Most of the revisions you’ve proposed pose such a remote threat that it’s not worth the effort to raise them with the business team or negotiate them with opposing counsel.” Then, perhaps after a brief pause: “To succeed in this environment, you’ll need to increase your tolerance for risk.”
That’s sound advice. The average business has little patience for in-house lawyers who place unnecessary legal obstacles in its path. But that fact sits uneasily with another aspect of the job. You still have to flag the threats that do represent a true danger. Left unchecked, risk tolerance can spiral into recklessness.
Consider what took place inside General Motors in the 2000s. During that period, the legal department settled a battery of lawsuits that centred on a similar complaint: the airbag in certain vehicles sometimes failed to deploy during a collision. According to a Harvard-led case study, “most claims were less than $100,000” and “did not require the notification or involvement” of those in leadership. The legal team “seemed content to refer the problem to engineering and wash its hands of the issue once settlements were made.” Had management known about the lawsuits, it might have launched a rigorous investigation into the defect. Instead, it took GM more than a decade to discover that millions of its cars relied on an ignition switch that randomly shut down the engine and cut the power to various safety systems—including the airbags. That led to a massive recall and a criminal inquiry into the company.
It’s possible that, until the ignition-switch revelation, GM’s legal department never doubted the wisdom of its conduct. After all, a risk-tolerant lawyer is supposed to handle relatively inexpensive matters without disturbing the top brass. Even the Harvard case study interprets the fiasco not as “a black-and-white morality tale” but as an illustration of how tricky it is for corporate counsel to balance “business with the law.” All of which raises a delicate question: what sort of in-house legal issues demand attention?
For a partial answer, let’s return to the task of contract review. Perhaps your boss has asked you, a humble counsel, to look over a raft of edits that a customer has inserted into a purchase agreement. You promptly notice a new clause that would compel the company to respond to technical-support inquiries within 24 hours. That language gives you pause: the technical team is too short-staffed to reply at such speed. Should you insist on a longer maximum response time, knowing that you’ll slow down the deal? Absolutely. When a company makes a promise it can’t keep—no matter how trivial the promise might seem—it opens itself up to disputes and irritated customers. Your boss will be happy to sidestep those outcomes.
It’s also useful to stay plugged into the rhythms of your industry. If you work at an investment fund, study the news coverage of the financial sector. By reading about the legal troubles of your competitors, you can help your employer avoid the same pitfalls. If you work at a publicly traded corporation—such as a bank or insurance company—pay attention to the robust disclosures that it issues to shareholders. Those documents will outline potential threats to the business, which you can stay alert to in your daily work.
Perhaps you’ll one day spot a major problem, like the alarming string of lawsuits that GM’s legal team neglected to take to management. It might be tempting, especially if you work in an environment that prizes risk tolerance, to sugarcoat the truth or pretend that the matter isn’t serious. But you must find the courage to share your concern with someone who has the power to take action. Even if that means bursting into the office of the CEO.
How to scale the hierarchy
At a large company, the first in-house title jump typically occurs after a few years at the counsel level. Having proven yourself as a capable team member, you’ll move up to senior counsel. In one sense, your job will remain the same. You’ll continue to serve as a kind of legal technician, counted on for important tasks but deprived of the authority to supervise other people. What’s likely to change, however, is the role you play in certain meetings. Senior counsel often advise executives and members of the board. Before such an audience, it’s crucial to speak in a way that’s pithy, clear and bereft of obtuse legal vernacular. That’s what top businesspeople have come to expect.
Ideally, your next career transition will turn you into a managing counsel or vice-president with institutional clout and a team to manage. But it’s tricky to reach that rung of the in-house ladder: many companies impose a strict cap on the number of lawyers who can hold such high-ranking roles. The only route to that upper band is to replace someone who has quit, retired or moved up to an even loftier position. If you find yourself stuck as a senior counsel, with no promotion in sight, you might have to hit the job market and decamp to an organization that does have a VP-level opening. You don’t want to wait patiently for an opportunity that never arrives.
That leaves one final role to discuss. Traditionally, companies have referred to the top lawyer on staff as the general counsel. And they still do, quite a lot, today. But an alternative honorific has risen in popularity: chief legal officer. “Indeed, many top in-house lawyers have traded in the legal-sounding title of general counsel for the more corporate sobriquet of CLO,” reports the Fordham Law Review paper on the history of corporate counsel. The idea is “to signal that they are part of the company’s C-suite.” That trend offers a powerful lesson. Those who have scaled the in-house hierarchy, all the way to its peak, see themselves not as detached advisors, working on convoluted issues that no one else can understand, but as true partners in the business, as vital to its success as any other executive.
Daniel Fish is the editor of Precedent. Since joining the magazine more than a decade ago, he’s reported on dozens of topics, including the legal economy, mental health and partner compensation. In that time, he’s received several leading journalism awards for his long-form feature writing.
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Illustration by Pete Ryan.