Legal

General Counsel / Chief Legal Officer

The role of the general counsel

The general counsel or chief legal officer is responsible for overseeing all legal aspects of the business, from compliance issues to managing litigation risk. They ensure the company adheres to local, national and international laws.

With some businesses, a GC becomes a must-have – for example if you are preparing regulatory filings –  while other times it becomes a beneficial nine-to-have, more of a consigliere role to help the CEO and the board discuss the long-term vision of the company and how to consider contingencies from a legal perspective and to ensure the business stays out of trouble.

It is important to note the nuances between a GC, a chief legal officer and a chief compliance officer.

Typically, a chief legal officer is the head lawyer of the company’s legal department as well as an advisor to the senior management. While there may be some overlap in the naming or job function, a chief legal officer usually has more of a hand in business strategy or in a supervisory role over compliance or risk management. Finally, a chief compliance officer may focus more on internal policies, ethical standards of practice, regulatory audits or specific compliance with laws in more heavily regulated industries, such as banking.

When to hire a general counsel

From our experience, you need a general counsel likely around the Series C stage, depending on your business. Highly regulated, compliance-heavy businesses might need to hire someone earlier, of course, but we see the most common need for a GC when a company is either considering expansion, product diversification, rapid scaling or an exit.

You would hire for this position when you need someone that's more strategic than in-house counsel and when you need to start thinking more broadly about what your business is doing. If often coincides with when you're starting to spend more money on external counsel and it makes sense to bring the role in-house.

What makes a world-class general counsel?

Anecdotally, we have seen that it’s easy for GCs and lawyers to say no to initiatives that involve risk. The exceptional GCs, however, think more like a business person, more like a line-of-business owner, and their mindset takes the approach of, “if I were running the sales team, what am I trying to achieve and why? How do we reduce the chance for something to go wrong? I recognize there is inherent risk, how can I proactively mitigate it?”

Those exceptional GMs are incredibly strategic and highlighting where the long-term value actually lies.

One of the variables that differentiates world-class GCs from those that are simply good is being more proactive and a bit more engaged on the strategic direction of the company.

As an example, a good GC might be able to take an existing script from a chief sales officer and work to retrospectively make it better, an exceptional GC would identify the goals earlier and work in parallel proactively to produce a compliant, legally-sound script first.

Positions LF Partners has placed

• General Counsel, EasyKnock

Deputy GC

The role of the deputy general counsel‍

The deputy GC supports the general counsel by handling day-to-day legal operations, supervising junior legal staff and managing specific legal cases or issues.

When to hire a deputy general counsel

This position is essential in larger legal departments where the volume and complexity of work require delegation of responsibilities to ensure efficient management and focus on high-priority legal matters.

What makes a world-class deputy general counsel?

A world-class deputy general counsel has a solid legal background, leadership capabilities and the ability to handle complex legal issues with discretion and meticulous attention to detail.
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Chief Compliance Officer

The role of the chief compliance officer‍

This role involves ensuring that the company complies with external regulatory requirements and internal policies. The CCO also advises the company on possible risks in business strategies and human resources.

The chief compliance officer typically reports into a chief risk officer. Sometimes compliance roles will report to the general counsel, but in these instances they probably don't have a chief compliance officer title. Instead, they might be a VP of compliance.

The chief compliance officer role is critical role for lending businesses to ensure compliance with federal and state regulations.

It's the second line of defense for managing fraud that would be detrimental to the company and to their customers. There's a development of policies and procedures to ensure compliance with federal and state laws and more senior strategic roles. It is a role that requires collaboration across the C-suite to know the business and partnering with external government relations and legal.

Unlike a general counsel position that is filled by an attorney, the chief compliance officer role is a mixture of attorneys and non-attorneys.

When to hire a chief compliance officer

A chief compliance officer is vital for heavily regulated industries or when a company is expanding into new markets with unfamiliar regulatory environments.

What makes a world-class chief compliance officer?

A top-tier chief compliance officer is highly knowledgeable about the regulatory landscape, possesses outstanding organizational skills and has the foresight to anticipate and mitigate compliance risks.