General counsel and “crisis management” for their company

Out of a sample of 235 US general counsel surveyed this year, 27 percent of them said they spent more time on crisis management in 2006 than in 2005. The press release of the joint surveyors, Corporate Board Magazine and FTI Consulting, obliquely defines a crisis as “a natural or man-made disaster requiring temporary relocation, off-site data storage and backup facilities, or a legal or public relations issue threatening credibility and stakeholder trust.” The last clause opens wide the door, as any significant law suit can threaten the credibility of a company and the trust of its shareholders. So can potential legislation.

We can all understand natural calamities like earthquakes, floods, or hurricanes as crises. Sarin gas released in subways, jets crashed into buildings, maniac gunmen on the loose and power outages also fall into the crisis pit. But we stretch the term too far when it envelops “legal or public relations issue threatening credibility.” The blog has few posts on law departments and crises (See my posts of Nov. 6, 2006 about virtual law firms to help in a crisis; March 21, 2006 about law departments as “emergency management profession”; and Aug. 28, 2006 on crisis planning for the law department – business continuity.).

My basic view has been that not everything in a company should be “legalized” and made a primary concern of the general counsel (See my post of Dec. 20, 2005 that argues that law departments should not lead corporate crisis teams.).

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