Editor: Describe your background and role in FDCC.
Pratt: For nearly 30 years, I practiced law with Shook, Hardy & Bacon in Kansas City, MO. Six years ago, I became General Counsel and Corporate Secretary for Boston Scientific, a multinational medical device company. Over time, I picked up additional responsibilities, and I am now the Chief Administrative Officer overseeing Corporate Strategy and Marketing, Government Affairs, Global Regulatory, Corporate Communications, Health Economics and Reimbursement, and Aviation. I am also serving as the President of the Federation of Defense & Corporate Counsel (FDCC), a preeminent invitation-only, limited membership organization of accomplished defense and corporate counsel around the world. I am the first in-house counsel to serve as FDCC president; however, I will be succeeded as president by Vicki Roberts, an in-house counsel for Meadowbrook Insurance Company.
Editor: What initiatives are you driving for the FDCC?
Pratt: We are striving to make a difference. One of my initiatives is the 21st Century Practice of Law Project, which will look at the challenges facing law firms and corporate law departments in these rapidly evolving times. That project will not just discuss the challenges, but will offer practical solutions. A blue ribbon task force consisting of outside and in-house counsel will tackle these issues. This task force will publish its findings in the FDCC Quarterly and be part of the plenary programming at the FDCC Annual Meeting at The Greenbrier, scheduled for July 27 through August 2, in White Sulphur Springs, West Virginia.
Editor: What is the FDCC doing with respect to in-house corporate counsel?
Pratt: We are dramatically increasing our Corporate Member membership ranks. The FDCC has a lot to offer general counsel and in-house chief litigation officers, and my priority is to bring the FDCC, and what it can do, to the attention of these individuals. That strategy has worked when you look at our growing corporate counsel membership and their attendance at our meetings. However, as I well know, we need to provide them with a value proposition for membership. The FDCC does that. Our programming targets in-house counsel, and our successful webinar series regularly chooses topics that have as much interest to in-house counsel as they do to outside counsel. Our Winter and Annual Meetings incorporate programming for in-house counsel, such as a morning session where in-house attendees get together to network and share what’s on their minds. Finally, the FDCC Corporate Counsel Symposium focuses exclusively on the interests and needs of in-house counsel. This year, our CCS will be held on September 17 through 19, 2014, at the Arizona Biltmore in Phoenix. The CCS is open to all in-house counsel, whether FDCC members or not, and we control the proportion of attendees by requiring outside counsel to bring a client as a “ticket” to admission.
Editor: What expectations do you have for law firms your company retains?
Pratt: Despite all of the talk about cost control, the reality is that quality and outcomes still trump everything else. Winning counts, and make no mistake about that. Other things count as well. We want to build a collaborative partnership with outside counsel. Yes, every corporate client says that, but what does it mean? To me, it means that outside counsel understand my business and the pressures I deal with every day. Outside counsel then become logical extensions of my in-house team. The connection is seamless. And, integral to all of that is a relationship built on trust, open communication, and shared efficiency. If you have all of those components, the costs take care of themselves.
Editor: What are the most pressing concerns of those leading law firms in 2014?
Pratt: I’m not involved with running a law firm, but I suspect that the single most overarching concern of law firms is getting business and making an appropriate profit margin from that business. That concern, however, has been the leading worry of law firms since I began to practice law. What is more challenging today is figuring out how to crack the code of getting that business. Most corporate law departments have decreased the number of law firms doing their work. Fewer still are giving new law firms a chance. Cost constraints, though loosened a bit since the nadir of the recession, still exist. If I ran a law firm, that would keep me up at night. But I would also worry about retaining my talent, deciding whether to grow or expand my geographic reach, and distinguishing my firm from all of my competitors.
Editor: So, what’s the answer? What advice would you give those law firm leaders?
Pratt: The business of rainmaking has never been easy. Law firms still generally rely on a few partners to drive the work of the rest. Law firms need to train every lawyer on how to acquire business and insist that every lawyer prioritize rainmaking in his or her practice. Lawyers need to know that getting business requires a proven record of success, so they need to win big and build a reputation of sustained excellence. Lawyers need to understand that getting business flows from personal and professional relationships, so they should get out of their offices and build those relationships. Lawyers need to know that clients form judgments about lawyers from observing their level of engagement and performance outside the courtroom, so they should become active in legal organizations, like the FDCC, and become known to others. Lawyers need to know that corporate clients are looking for lawyers with demonstrable leadership skills, so they should participate in leadership courses to hone those skills. Lawyers need to know that the business of law requires an understanding of business and financial principles, so they should teach themselves those essentials and learn the lingo of the corporate world. Lawyers need to know that corporate clients want lawyers who know their industry, so they should read the same kinds of things that in-house counsel read – annual reports, SEC filings, press releases, proxy statements, and other things that describe what and how the corporation is doing.
Editor: How critical is it that law firms have enterprise risk management (ERM) processes and systems?
Pratt: ERM is an essential program for successful corporations and is one of the most important governance imperatives for corporate boards of directors. The reason is obvious. No matter where a corporation ranks on the success curve, it is well served to look ahead at the things that may go wrong and build contingency plans for them – identify, prioritize, plan, and execute. Most law firms spend little or no time on ERM. They may talk about their fears about the future, but they don’t create an ERM program that has ownership and accountability.
Here is one example. In the corporate world, talent evaluation and succession planning are in our DNA. We spend an enormous amount of time on that, and for good reason. We have to create a strong bench to anticipate planned and unplanned departures. It happens whether the leader is 40 or 60 years of age. Law firms, glorifying the traditional territorial “you eat what you kill” compensation system, have created a culture that disincentivizes a program of early and seamless client transfers. Relationship partners, fearful of losing control, hold onto clients in a death grip. That approach ill-serves the long-term interests of the law firm. The risk of something happening to the relationship partner exists, and the client should know and be comfortable with who could quickly move into the position of leadership should that eventuality occur. That, and so many other law firm risks – losing critical clients, managing an unexpected financial crisis in the law firm, finding the firm in a lawsuit or investigation, dealing with a security breach, and on and on – need to be anticipated and the risks mitigated. That’s what ERM is. Law firms should learn how to do that – and then do it.
Editor: Enough about law firms – what are the biggest challenges facing corporate law departments these days?
Pratt: Corporate law departments do a whole array of things. Not only do we manage litigation risks, we also manage our intellectual property, employment risks, governance issues, securities filings, business and international legal risks, government investigations, and on and on. So, all of those things keep me up at night. Our challenges are not dramatically dissimilar to those facing law firms. We must win legal disputes and mitigate risks. We must do so in a cost-effective way, both in terms of our internal spend and how much we pay for outside legal services. We must manage our talent and ensure a steady stream of high-potential successors for every key position. We must support the businesses and create a culture of compliance in all we do. We must display leadership, collaboration, communication, facilitation, and integrity. It is what we do. It should be who we are.
Editor: What responsibility do lawyers have to be a part of improving the practice of law and our profession?
Pratt: We should be proud to be members of this honored profession. We surely worked hard to get here. It can be stressful and frustrating at times, but what we do is important for our clients and all who avail themselves of the civil justice system. Simply put, that is leadership. Lawyers should lead change and not accept the status quo. The FDCC was involved recently with Lawyers for Civil Justice to support proposed changes to the Federal Rules of Civil Procedure. We get too few chances to participate in changing the rules that govern our federal civil justice system, and we should and did take advantage of that opportunity. We hope that these changes, which impose more reasonable limits on discovery and incorporate other needed improvements, are ultimately approved. These, and other opportunities, should be sought by lawyers because it’s better to be impactful than passive. It is important to always look for ways to improve the status quo.
Editor: Are you having fun?
Pratt: I love what I’m doing for Boston Scientific. We advance science for life and provide products that help patients around the world. It is empowering to be a part of that mission. I also enjoy being the president of the FDCC. The three pillars of our mission are knowledge, justice, and fellowship. I’m privileged to be a part of driving changes that help advance each of these pillars.