Legal Service Providers Can Help Your Company Create And Maintain A Compliance Culture Two Examples

Thursday, September 1, 2005 - 01:00

Al Driver

We have pointed out the contribution made by law firms with a partnering
attitude to the success of corporate counsel. Legal service providers can also
be significant allies. Tim Wahlberg of Thomson West in his interview on the
front cover of our Special Section on Technology mentions that corporate
counsels' "jobs are getting more complicated and the stakes are getting higher."
He mentions that the complexity is driven in large part "by compliance and other
pressures in the post-Sarbanes-Oxley legal environment" and that the stakes are
higher because corporate counsel can now "be held responsible if they are not
ahead of the curve, anticipating every issue and requiring the right policy and
standards." The interviews on the front covers of this issue and its Special
Section on Technology provide examples of the critical roles played by legal
service providers in assuring that corporate counsel stay ahead of the curve.

The recent Merck Vioxx case demonstrated that the defense of a product
liability case can be seriously undermined if plaintiff's counsel can exploit
just a few careless statements that can be used to portray a company as being
more interested in profits than in the safety of its products. One way to reduce
your company's vulnerability to the tactics used by plaintiff's counsel in any
future case is illustrated by MCI's efforts to create a pervasive compliance
culture, which is described in the interview on our front cover. That interview
emphasizes the important support role played by outside consultants: namely, Jim
Ewing and Jerry Kral of Standard & Poor's Corporate Value Consulting.

In the wake of the Merck case, plaintiff's counsel will redouble their
efforts to prejudice a jury by assembling as many careless statements by
employees as possible. The only effective way to cope with this is to create a
compliance culture throughout the organization that will not only convince a
jury of a company's sincerity but also cause employees to reflect that sincerity
in their statements. The interview portrays the efforts made by MCI to create
such a culture. It contains an important message for corporate counsel - namely
that the legal department cannot do the job alone; there must be an enthusiastic
buy-in throughout the corporation from the top down. The interview makes it
clear that the role of the general counsel requires her to act as the key
advisor to the CEO in accomplishing that mission. As Stasia Kelly points out, it
was helpful to her in playing that role to enlist the services of an experienced
legal management consulting organization skilled in the organizational dynamics
involved in embedding a company-wide compliance culture.

Similarly, Tim Wahlberg in his interview describes Thomson West's efforts to
learn about corporate counsel's needs so that it can better serve them. Tim
talks about Thomson West's dedication to helping corporate counsel stay ahead of
the curve, including with respect to their compliance obligations. He describes
how existing products are being improved and new products are being introduced
in response to those needs. He mentions West's objective of providing corporate
counsel with interpretative and other material that provides information about
best practices. West recognizes that staying ahead of the curve from a
compliance standpoint involves not only knowing about existing laws and
regulations, but also about pending legislation - and it has improved its
ability to provide such information. Getting out in front of events, involves
not only knowledge of existing case law, but also information about pending and
unreported cases - and West has enhanced access to such information. Because
disclosures in documents to be filed with the SEC must be correct, it is
necessary to know how other companies have handled similar disclosures - and
West has improved corporate counsels' access to documents and attachments filed
with the SEC.

These are but two examples of how legal service providers with a partnering
attitude can enhance corporate counsel's ability to cope with the complexities
and risks they now face. We hope in future issues to throw the spotlight on
others who are also dedicated to partnering with you in this new and most
challenging environment.