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The unknown risks or benefits of bringing in a general counsel from outside the department

“One of the few things that management theorists agree on is that recruiting bosses from outside is something that you should avoid if you can.” This quote, from the Economist, Aug. 7, 2010 at 65, speaks to CEOs, but do general counsel escape its point? Unfortunately, we have no empirical data that allows us to take a position either way. Viewpoints, theoretical arguments, and anecdotes aplenty, but no longitudinal data to the test the effectiveness of imported legal chiefs compared to promoted ones.

Until data becomes available, speculation and reasoning is all that is left us. I have indulged copiously in both (See my post of Jan. 4, 2006: if the law department needs shaking up, hire a general counsel from outside; Feb. 19, 2006: higher pay for the external GC hire than the internal GC; April 16, 2006: when a general counsel is promoted from within; March 26, 2005: internal vs. external successors; April 16, 2007: passed-over internal candidates may lose effectiveness or leave; Nov. 17, 2008: women general counsel promoted from outside; Dec. 23, 2008: two thirds came from another law department or were promoted internally; May 15, 2009: general counsel who audition; Sept. 30, 2009: does newcomer from outside push more initiatives; and Jan. 7, 2010: better to promote from within than hire from without.).

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One response to “The unknown risks or benefits of bringing in a general counsel from outside the department”

  1. Denis says:

    Unfortunately most companies believe that it is better to bring someone from outside than to promote someone from the company. I guess it would request an open preparation policy to make people ready to new challenges. In the meantime, those who are forgotten aim to be promoted at another company, willing to be the “outsider boss” somewhere else. Kinda sad, huh?