This article appeared previously Association of Corporate Counsel’s ACC Docket and is published here with permission from the journal.
I recently had separate conversations with two close friends (let’s call them Bill and Joe) that caused me to wonder whether corporate leaders and their counsel have lost their way. Bill was the general counsel and corporate secretary at a Fortune 500 company. Ascending to this post was the culmination of many years of hard work and the achievement of a career goal he set for himself 10 years earlier. However, Bill told me that he decided to abandon his dream job, in part, because he found himself facilitating activities that he found morally repugnant. One of the less savory duties he mentioned was drafting documents to affect board members’ compensation packages.
Bill explained his board comprised a group of puffed up, egotistical blowhards whose primary concern appeared to be their own interests. Bill told me that it was painfully clear to him that these board members cared far more about their options packages than they did about the employees, the company or the shareholders. Bill felt that by preparing the papers that affected the raw avarice of such loathsome people, he had become a part of a grotesquely perverted corporate governance system where fiduciary duty took a backseat to naked self-dealing.
The conversation I had with Joe was no less disturbing. Joe was a bankruptcy attorney for a local law firm. Given the significant ethical issues that arise when company’s become insolvent, I was curious about how Joe advised clients who seek advice in the early stages of a cash-flow crisis. Joe replied by explaining the various ways he seeks to understand the client’s particular needs and to serve their interests. I then asked Joe a simple question: “Do you ever advise clients to behave honorably?” Joe looked puzzled by the question. The idea of providing such advice had never occurred to him. He then chuckled a bit — amused by the apparent novelty of “honor” in the context of the work he did — and replied by saying: “Of course not. I couldn’t keep clients if I took that tack.”
As corporate counsel, we are more than zealous advocates for our clients — we are the keepers of the corporate conscience.
Bill’s service to egotistical, self-absorbed board members and Joe’s aversion to recommending that corporate clients behave honorably are not merely isolated incidents. Instead, they are examples of significant ethical challenges corporate counsel confront on a regular basis. As such, they should cause us to take a moment and examine carefully what we do for a living and how we do it. If we act as mere functionaries, robotically carrying out the will of others — regardless of the consequences — and we are not inclined to advise clients to behave honorably, I think we might ultimately find ourselves in a wilderness devoid of moral content. As corporate counsel, we are more than zealous advocates for our clients — we are the keepers of the corporate conscience. As often as not, our clients come to us with difficult problems, expecting more than a recitation of the law; they want to know the right (honorable) thing to do. This is both a great privilege and a great responsibility, and shame on us if we lack the courage of our convictions to steer our clients in the right direction. I’ve had colleagues in corporate law departments tell me: “I don’t think what they (i.e., our colleagues running the business) are doing is right, but unless it’s illegal, it’s not my place to express disagreement with their decision.” What utter nonsense! We are part of the business team. The decision-makers may ultimately disagree with our advice, but they are paying us for our best thinking — not to be a rubber stamp for stupid or immoral ideas. Running a business ethically is synonymous with running a business well. A key part of our role is (and should be) to help our colleagues navigate the ethical and legal mine fields they frequently confront.
Running a business ethically is synonymous with running a business well. A key part of our role is (and should be) to help our colleagues navigate the ethical and legal mine fields they frequently confront.
Having lived in the “belly of the beast” for nearly 20 years as in-house counsel and as an ethics officer, I know very well how difficult this task is. As Bill observed, we are often confronted with the outsized egos of very powerful people. And, most of us don’t have the means to simply walk away from jobs we find unsavory without putting ourselves in financial peril. But, this is no excuse for turning a blind eye to unethical conduct or, worse yet, facilitating it.
Taking on this work is not for the faint of heart. It requires both courage and cunning to develop and execute a plan that will steer the company and its leaders in the right direction. The frontal assault may be necessary on some occasions, but sneaking in the back door by quietly building key alliances is often the better approach. However, none of this can happen if we, ourselves, are not sure of the direction to take. Not only do we have to master our craft, we also need to consistently follow a moral compass that points toward a principled end achieved by ethical means.
And so, in the interest of helping our clients find their way, and of ensuring we don’t spend our careers engaged in facilitating behaviors we will later regret, let’s find the courage to unapologetically advise clients to pursue an honorable course. ACC