Building the GC Role - A Journey in Legal Leadership
Experienced legal professional shares insights from representing high-growth companies, transitioning to in-house counsel at Gilead Sciences, and current role as GC in residence providing guidance on legal, governance, and team development.
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BUILDING THE GC ROLE July 17, 2024 We represent what s next.
Clear Leader for the Innovation Economy Gunderson Dettmer has decades of experience representing high-growth companies in their financings, IPOs and M&A transactions, and throughout their lives as public companies. 400 lawyers globally in 11 offices worldwide 500+ venture capital and growth equity clients, and thousands of their underlying funds 4,500+ company clients in the innovation economy worldwide #1 GLOBALLY most active law firm for venture capital financings every year since 2014 (PitchBook) 1,800+ venture financings for companies closed since 2022 $29B+ 300+ raised in venture financings for companies since 2022 M&A transactions globally since 2022 2
Introduction Background Price Waterhouse consultant to law firms and law departments out of college Gunderson Dettmer Associate and Partner Represented venture capital firms investing in start ups Represented start ups from incorporation through venture capital financings to IPO or M&A Represented public companies on governance and disclosure issues Left for Gilead Sciences in 2005 where I was in house over 17 years Established the company s transactions practice Served as General Counsel from 2009 until 2022 Department grew from ~15 people to over 350 around the world during my 17 years Worked with three CEOs Managed through periods of massive financial and geographic growth and periods of stagnation Handled multiple bet-the-company litigation matters I did not report to the CEO when first appointed GC, I had to earn my way there 3
Gilead Practices Corporate and Securities Corporate transactions Governance Compliance General Litigation Commercial litigation Government and internal investigations E-Discovery Intellectual Property Prosecution Litigation International Europe, Middle East, Australia Asia Developing World Labor and Employment Privacy Competition law Legal Operations 4
Current Practice Background Re-joined Gunderson as Of Counsel in mid-2023 Current Practice Providing in-house perspective on approaching legal and governance challenges Advising life science and public companies on issues specific to them GC in residence Help GCs think through operational, legal and governance issues Mentor GCs on their development and the development of the legal team Help CEOs think about establishing a legal department and evaluate and shape existing legal teams Evaluate legal department structure and talent level, consult on resourcing and department structure Phone a friend something I constantly searched for in-house 5
Agenda PART 1 PART 1 1. Introduction 2. How do I build my GC role? 3. Why isn t the GC in the Room Where it Happens? 4. How Does the GC Change the Dynamic? 5. Elements of the CEO Relationship 6. Developing the CEO Relationship 6
Agenda PART 2 PART 2 1. From Back-Office Fixer to C-Suite Partner 2. What a Fully Formed GC Role Looks Like 3. Obstacles to Expanding the GC Role 7
Agenda PART 3 PART 3 1. What s the GC s Relationship with the Board? 2. Getting Exposure to the Board 3. Co-existing with Outside Counsel at the Board Level 4. Key Questions for Developing Your Strategy 5. What Conversations am I having with GCs? 6. What Conversations am I having with CEOs? 8
How do I build my GC role? By far, the most common conversations I have with GCs revolve around: Frustration at having a constrained role and not seeing a path to expand it Being head of legal, but not being given the title of General Counsel or having a clear path to getting there CEO not including GC in strategic conversations that would benefit from legal input In some cases, GCs report to the CFO, in many cases they do not CEO/management engaging in self help, or calling outside counsel, instead of engaging the GC Lack of CEO interest in the activities or development of the legal function 9
Why isnt the GC in the Room Where it Happens? Start-up CEO acted as the company s lawyer Many early-stage company CEOs have never worked with an attorney before Many early-stage company GCs have never worked with a CEO before Many new and newly arrived in-house lawyers don t show up as ready for the C-suite The company has been operating for years without an attorney. The leadership team may not see strategic value of GC At early stages of a company, there may not be a legal C-suite role The CEO is not yet prioritizing building a robust legal function 10
How does the GC change the dynamic? Practice GC self-awareness Do you understand what a fully actualized GC role looks like? Do you understand what the company currently needs from the GC role? Do you have the experience and skills to perform in that role? Are you operating in a way that makes the CEO believe you can own a broader role? Build a strong relationship with the CEO The CEO is the GC s most important constituent -- by far Educate the CEO and management Most first time CEOs have never supervised lawyers and will need to learn over time how to best utilize their services Their views on this will be heavily influenced by their interactions with the GC in front of them This can result in GCs being put in the contracts, IP, HR, crank turner box versus the strategic partner box How the GC shows up matters Help the CEO and other executives see the connection between key legal issues and the success of the company s business plan and strategy 11
How does the GC change the dynamic? All GC roles grow over time Company needs expand CEO, executive and board respect for GC capabilities and potential grows over time GC s capabilities grow over time Initiate on-going dialogue with the CEO about the GC role as the company and GC develop - Volunteer for, and crush, those special projects that come up on executive teams Learn the potential of your particular role Until you sit in the GC seat, you cannot fully understand its demands. Long time law firm partners, and even long-time in-house counsel, have the same challenge As you learn the role, gradually expand your reach and develop your vision and strategy for expanding the contribution of your role You are likely to struggle if you take on too much too soon Don t make it about you Be patient! 12
Elements of the CEO relationship Relationship goals Trusted, objective, direct advisor Go to provider of solid business and legal judgment Truth teller/Devil s advocate Proactive and clear communicator Confidant Consigliere Personal representative Utility player for difficult projects/situations Idea generator Feedback giver 13
Developing the CEO relationship Get into the office! Create opportunities for informal interaction and familiarity Be in the right place at the right time for conversations and important projects Help the CEO see around corners - What legal issues is the company s strategy going to run into? - How do we create a strategy to address those issues now? Be proactive in anticipating CEO needs. - CEO expects you to handle the legal blocking and tackling. - Bring the CEO issues that affect how s/he should be thinking about executing the company s vision and strategy Be constantly available and predictably responsive Dive into and understand the details. CEO s can tell when you re detail surfing Communicate legal and business advice clearly and concisely Think through CEO s likely questions Practice answers that are concise and will resonate with the CEO Don t dictate legal solutions, discuss them Be direct, neutral, objective and discrete 14
Developing the CEO relationship Own the role Be proactive in fulfilling your role Asking the CEO for permission to execute basic elements of the role frustrates the CEO. They want their leaders to ACT Update the CEO on day-to-day legal activities, but remember the CEO assumes you are getting those done. Spend most of your CEO time on strategic matters. e.g., Our strategy relies on AI to understand and predict customer behavior, I have identified some areas where we will need to make sure our product doesn t run afoul emerging AI laws and regulations. Let s talk about them. e.g., Board member X called me asking for more information on the safety profile of our drug candidate. Given her confusion, perhaps we need to have a brief session on that topic at the next board meeting to make sure everyone understands it. If not feeling empowered by the CEO on day-to-day activities, discuss the limits of your authority with the CEO 15
Questions? 16
