Corporate counsel are in an excellent position to focus the corporate client's attention on how its actions can affect public attitudes that can influence a corporation's success or failure, whether it be in the marketplace or in the courts or legislatures. They are frequently better able to understand the long-range effects of corporate actions, including how incurring present costs may confer even greater future benefits.
We see in this month's Special Report on Pro Bono solid evidence that corporations and law firms have come to recognize the long range benefits of pro bono and are willing to pay for those benefits. Corporate counsel herald their pro bono accomplishments and welcome the pro bono activities of their law firms. Management has bought into the argument that, if the justice system is available only to the few, this will over time undermine the rule of law on which the corporation's very existence depends. Management recognizes that the credibility of the corporation, and that of its counsel, is greatly enhanced in the eyes of judges, juries, regulators, legislators and the public if the corporation and its lawyers (whether inside or outside) are indeed good citizens.
Next month, in our Special Report on Project: Corporate Counsel, we will discuss another situation where there is a need to invest now to obtain future benefits; namely, making the investment required to avoid the kinds of risk that can expose the corporation to scandals and allegations of wrongdoing. Having the ability to understand the legal consequences of corporate actions, corporate counsel can help the corporation head off actions that might sully its reputation or even grow into scandals that could threaten its continued existence.
Corporate counsel play a uniquely important role in corporate governance because, unlike other professionals within the corporation, they have both an ethical and legal responsibility to the corporate entity which transcends their duty to management. Sarbanes-Oxley highlighted that role. Corporate counsel are now struggling to understand Sarbanes-Oxley's implications for them and how they should respond - for some corporations this may mean that the legal function must staff up and tool up and that the status of the general counsel may need to be enhanced.
September's Special Report will set the stage for a series of seminars that will, through discussion and benchmarking, attempt to provide corporate counsel with guidance on these critical issues. These seminars will be held throughout the country and sponsored by leading law firms, major corporations and corporate counsel organizations. The series will be kicked off by a seminar held in New York City on October 14. See page 12 for details.