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Lex Mundi, a network of independent law firms, has released a report detailing the best way for legal leaders to handle an era of volatility, uncertainty, complexity and ambiguity (VUCA).

Earlier this year Lex Mundi held a conference with general counsels and chief legal officers in Amsterdam to see what worried them, Eric Staal, the vice president of business development at Lex Mundi, explained.

“This report is a response to GCs saying they're not sure what to look for,” Staal explained.

The reason for so many unknowns, Staal said, is that governments across the world are becoming more active in regulating  business, and there is a lack of precedent for many emerging technology issues.

“More and more governments have become more and more activist in terms of regulatory enforcement activity,” Staal said in an interview with Corporate Counsel. “There was a feeling that a lot of uncertainty was being driven by technology. Technology is creating a fourth industrial revolution that is changing and transforming business models.”

The report identifies four techniques to help general counsel identify and prepare for those unknowns. They are horizon scanning, scenario planning, embedding learning and information flow, and driving change.

1. Horizon Scanning. Staal said that horizon scanning is an attempt to anticipate what is under the radar. He explained that legal leaders should be looking ahead several years and looking to the policies of governments to see what kind of sanctions a company could face years down the line.

2. Scenario planning. This, he said, is to help people focus on the idea of a “black swan” event, which is a “highly improbable occurrence that has an extreme impact.”

3. Embedding learning and information flow. This, Staal explained, involves breaking down hierarchies and allowing for lower-level employees to feel comfortable to report potential issues to the C-suite. He said cybersecurity breaches are a good example of an instance when a company wants employees to get information to each other.

4. Driving change. Staal said driving change can be difficult but is most important. The best way to do it, he said, is to find a similar situation the company faced and put a dollar amount on the situation.

“The big challenge there is that if you're talking about an anticipated risk under the radar, how do you motivate people to prepare for that change?” Staal asked.