Letter From The President Of The New York County Lawyers' Association

2004-12-01 01:00

To The Readers Of The Metropolitan Corporate Counsel:

The New York County Lawyers' Association (NYCLA) stands ready to speak out whenever and wherever we believe reform is needed to foster ethical behavior and to preserve the integrity of the profession. NYCLA is just as ready, and proud, to practice the principles we preach, especially when it comes to accountability and transparency in corporate governance. NYCLA may well be the first local bar association to adopt a Code of Conduct as the culmination of a series of measures to establish the highest possible governance standards. We hope we are not the last. To that end, we urge all not-for-profit organizations, especially bar associations, to follow our example.

Americans are increasingly recognizing the importance of ethical behavior in the corporate world. Recent revelations of corporate malfeasance, and the legislative response to it, have fostered a new sensitivity to the need for prudent and responsible governance. Lamentably, this heightened sensitivity may in some instances be motivated by instincts of fear and self-preservation. But good governance and ethical behavior in business are important ends in themselves: they promote shareholder and consumer confidence that are essential to the health of our free market system. These same values are no less vital in the not-for-profit sphere. Voluntary civic organizations, entrusted with a wide range of charitable and socially beneficial missions, enjoy a special public trust. For these organizations, good governance practices are essential to the preservation of that trust.

Perhaps more so than any other voluntary, not-for-profit organization, a bar association must be especially vigilant in its adherence to good governance policies. It plays a unique role in fulfilling the duty of all lawyers to safeguard the integrity of the legal profession. Bar associations, however, as with all human institutions, are not necessarily immune from conflicts of interest or appearances of impropriety. The genius of a bar association and the reason it can stimulate creative reform are that they bring the bench and bar together in collaborative relationships. Its effectiveness depends upon leaders and directors who will subordinate their own interests to the mission of the Association and the public good.

The Code of Conduct, adopted by NYCLA's Board of Directors on November 8, 2004, establishes fundamental principles with which all directors, officers and employees must comply. It is designed to foster ethical conduct and to eliminate actual and perceived conflicts of interest. The Code defines a conflict as any personal, business, financial or client interest that may affect the objectivity of the individual's discharge of NYCLA responsibilities. Consistent with the notion that sunshine is the best disinfectant, the prevailing rubric is disclosure.This enables the entire Board to make an informed decision as to whether the conflict or apparent conflict requires disqualification. Whether it does or not, at a minimum, the interest is disclosed and its effect on the individual's judgment may be objectively assessed.

The Code also addresses a number of other issues, including the safeguarding of confidential information, the duty of care in the performance of the functions of an officer or director, and the duty of loyalty in the pursuit of the Association's interests. It clearly delineates the obligation to discharge fiduciary obligations to the organization in good faith, with a prudent level of diligence and care, and to do so in a manner that advances the organization's best interests. To insure awareness with the provisions of the Code, all covered individuals are required to sign it, acknowledging agreement to adhere to its terms.

NYCLA's adoption of this Code of Conduct represents the final piece in a panoply of internal controls and other protocols and policies, including an Audit Committee Charter, Investment Committee Protocols and other measures to ensure good governance and best practices. The existence of the Code and the provision for a signed acknowledgment represent effective means by which the Board exercises its oversight function and its responsibility of "setting the tone at the top." It is vital that NYCLA's members, as well as others throughout the legal profession and potential contributors, perceive that these measures are tangible indicia of our commitment to maintaining the highest standards of integrity and stewardship.

Sincerely,

Norman Reimer