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Chief Legal Officer vs. General Counsel: What is the Difference?

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The distinction between a chief legal officer vs. general counsel generally concerns the strategic mission of the company. Most corporations employ officers to run the daily affairs and operations. At the top of the hierarchy is the Chief Executive Officer or CEO. Immediately below the CEO in the hierarchy, and generally reporting directly to the CEO, are any number of other senior officers. Some of these officers may be managers of specific, operating divisions of the company. Each division may have a president in charge, who reports to the CEO. The company will also have officers who bear a specific, functional responsibility across all company operations. For example, the Chief Operating Officer (COO) is in charge of company operations. The Chief Financial Officer (CFO) is in charge of company finances. These individuals will generally be in charge of all company-related actions related to their subject-matter area, even within operational divisions lead by a president or vice president.

 

Chief Legal Officer Responsibilities

Like these other officers, Chief Legal Officer responsibilities include all legal operations affecting the company. It is not extremely common for a company to employ a CLO unless the company has significant operations that concern providing some sort of legal services or legal information. For example, a company that makes legal software, such as legal drafting solution or legal research engine, may employ a CLO. The CLO, in such a company, would be in charge of the company’s value proposition related to law.  

 

Role of a General Counsel

The role of a General Counsel, in contrast to a CLO, is a professional service provider employed by the company. The general counsel will general manage the legal department, which will consist of attorneys, researchers, paralegals, and other legal professionals providing legal services to the company. These legal professionals provide s number of services to the company, which are discussed below. The role of a General Counsel is to stay apprised of all legal actions affecting the company, informing the senior executive of the status of legal affairs, managing the company’s legal team and providing legal guidance to the company on legal matters. Let’s take a look at the type of activities that the general counsel either performs personally or oversees within the company.

 


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A general counsel serves three distinct roles in the company:

  • Advisor – As legal advisor to the company, the general counsel will provide legal advice and guidance on operational, financial, or administrative activities undertaken by the company. The advice and guidance do not need to be related to a legal-related company mission. The type or nature of legal advice will vary depending upon the company and its operations. As an advisor, the general counsel will identify legal issues, research those issues, and communicate the legal standards applicable to any company activity or operation.  
  • Representative –  The general counsel is the point of contact for all legal matters affecting the company. The legal matters again do not need to be related to a specific company mission or value proposition. The general counsel generally identifies and hires outside counsel to handle many of the legal issues. This requires the counsel to work with outside professionals to stay apprised of the status of legal actions. One of the most important function is to make certain company executives remain apprised of important legal actions facing the company.
  • Legal Service Provider – The counsel may personally perform specific legal services for the company. She may also supervise other legal professionals, such as researchers, paralegals, draftsmen, and legal secretaries providing these legal services. The nature of the legal services provided will vary based upon the company’s operations. Some routine functions include contract review and drafting, corporate governance practices, claims practice, and employment law.

Perhaps the most important role of the general counsel is that of advisor. Common areas of legal advice that the General Counsel provides to the company include:

  • Regulatory compliance – Most company are subject to some regulations or  laws which require routine disclosures or filings to remain in compliance. This is particularly true for companies producing products, harmful substances, collecting consumer or financial information, generating loans, or trading security instruments.
  • Corporate governance – Corporate governance procedures are a major concern for most corporate entities. The company must comply with state law and the company bylaws in holding meetings, notifying shareholders, holding votes, and disclosing information.
  • Employment laws – Employers must meet numerous disclosure requirements regarding workplace hazards, rights disclosures, or reporting discrimination. Further, the company must avoid discriminatory practices when hiring, firing, or compensating employees.
  • Customer privacy – Numerous consumer privacy laws apply to consumer and financial information. Complying with these laws generally requires adequate notice.
  • Intellectual Property – Intellectual property is often the most valuable asset of the company. The General Counsel will provide advice on securing and maintaining intellectual property rights, as well as not infringing upon the rights of others.

 

 

 


 

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