2nd QUARTER 2014
27
Good Working Relationships
In-house GCs who are members of the
management team are in the best position
to consider business goals and to be effective
counselors.That being said, “there is
sometimes a need for outside expert counsel or
independent counsel, depending on the nature
of the issue,” says Farran, “but inmy experience,
a majority of issues can be handled best by a
GCwho is part of the management team.”
But a GC won’t survive on that team very
long, Farran says, unless he or she understands
that “an answer of ‘no, you can’t do it that way’
is really useless to the company.” A GC who
is a team-player would instead say, “‘Well,
no, we can’t do it
that
way, but here are three
other ways we can accomplish the same
objective and I’m happy to work on others.’ ”
In the best case, GCs and CFOs work
together productively, and are not afraid to
speak their minds. “You have to have an open
system where people are free to brainstorm,
collaborate, share insights, and be critical,
without being antagonistic,” says Germana.
To not do so creates a dysfunctional
management team that operates as if the GC
exists only to answer a few questions. Says
Keefe, “bringing in the GC at the
end of a matter, like when sign-
off is needed, can often lead to
problems and delays.” Germana
suggests: “One of the most
effective approaches to a well-built
management team is to place the
GC in the decision-making process
early, to get the benefit of his or her unique way
of viewing challenges and solutions.”
In Nestlé’s management meetings, because
there’s a concept of value, every question is
considered through the frame of “What is the
value of what you’re doing?” says Goldberg.
CFOs and GCs are thus thinking similarly.
Goldberg goes on to say that debates and
different viewpoints can be “a huge value to
a company. So, CFOs andGCs may come at
things fromdifferent angles, and they may
come to the same conclusion or different
conclusions, but the main thing is that with
both in on the discussion, there exists a
much greater likelihood that all issues
will be considered.”
CFOs may be familiar with
the “Business Judgment Rule.”
Germana explains: It provides a
level of protection against judicial
interference with the workings of a
corporation if the officers act in good faith,
in the best interests of the corporation, on an
informed basis, in ways that are not wasteful
and do not involve self-interest. “GCs’ advice
is part of the process of establishing that
managers acted on an informed basis and in
good faith,” he says.
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