Two drawbacks where lawyers are decentralized so they don’t report to the general counsel

Tom Sabatino, Jr,, the general counsel of Schering-Plough, argues in Met. Corp. Counsel, Vol. 15, July 2007 at 51, that lawyers “have to have accountability up to the general counsel. It reinforces the lawyers duty to the corporation.” In support of his view, he adduces three points.

He links the increasing focus on compliance within corporations to what he characterizes as “the trend toward direct accountability to the general counsel.” Sabatino must assume that the compliance function reports to the general counsel, which is not always the case (See my posts of Oct. 21, 2005; May 20, 2005; July 31, 2005; and Dec. 22, 2005 on reporting lines to the legal department of the compliance function.).

Sabatino next argues that direct reporting of lawyers “foster’s knowledge sharing and teamwork within the law department.” If lawyers work within business units silos, they have less reason or opportunity to share their experience and work product with outsiders (See my posts of March 22, 2006 on solutions to silos; Jan. 30, 2006 on cross-functional teams at Independence Blue Cross; and March 28, 2006 about PPG’s efforts to break down silos.).

He closes by saying that centralized reporting of lawyers “provides for a clear path for professional development and career enhancement.” At Schering-Plough, the law department has an elaborate performance management process and in his view “this is something that would be very difficult to do in a decentralized model.” His point is that there are fewer promotions and opportunities to take on new responsibilities when lawyers report up through a narrow stovepipe.

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