(l-r) Noreen M. Fierro, Senior Vice President and Chief Ethics and Compliance Officer, Eric R. Dinallo, Executive Vice President and General Counsel, Ellie Nieves, Vice President and Counsel for Government Relations, and Sean D. Quinn, Vice President and Chief Litigation Counsel, with Guardian Life Insurance Co. of America in New York City. May 29, 2019.

When Eric Dinallo became general counsel of the Guardian Life Insurance Co. of America just over 18 months ago, he had three goals in mind. First, Dinallo wanted to manage the legal department more like a business. Second, he decided the team needed a “strategy partner for diversity” to continue its strong efforts in that area. And lastly, he wanted a legal operations unit to help with automation and outside counsel management.

He has achieved all three goals as the legal team continues to serve a thriving Manhattan-based company that has grown from 5 million customers in 2011 to over 25 million today. And his legal department has done it all while embracing the company mantra to “do the right thing.” Their efforts earned Guardian the right to be named one of the overall Best Legal Departments for 2019.

On managing the department like a business, Dinallo says, “It's not like we were going to make money, but I wanted us to have the metrics to give us the ability to show the rest of the company what value they were getting from us.” Dinallo joined Guardian from Debevoise & Plimpton, where he most recently served as co-lead of the firm's insurance group representing financial services firms. Guardian was one of his clients.

“I was impressed with their values and with [president and CEO] Deanna Mulligan,” Dinallo recalls. “And I thought it very exciting to be at a mutual company, in a values and mission-driven environment different from a public company that has to answer to its shareholders.” Dinallo also found the mix of Guardian's businesses challenging and “really interesting, especially from the law department viewpoint.”

Founded in 1860, Guardian is one of the largest mutual life insurers. Besides life insurance, its offerings range from employee benefits to annuities and investments, plus disability income insurance, and dental and vision insurance. The company has over 9,000 employees and 58 agencies nationwide. It also owns Colorado-based Reed Group, which offers management services that help employers reduce the cost, compliance risk and complexity of employee absences, such as family or disability leaves.

“The company has doubled its number of employees and quintupled the number of customers it serves,” Dinallo notes. “I looked back and the legal department has performed super well with very little growth, except in compliance as the regulatory environment has changed. It's amazing.”

The diverse, 159-member department includes 50 lawyers and encompasses legal, compliance and government affairs. Ellie Nieves, vice president and counsel in government affairs, is the team's first diversity strategy partner. Nieves says she partners with human resources to develop programming that focuses on mentoring, coaching, investing in current and future talent, and improving vendor relationships, including more diversity among outside counsel. Among other things, Nieves says she founded Guardian's Women's Leadership Network, a companywide employee resource group with over 400 members and six chapters across the U.S. and in India, which has 1,800 employees handling back-office operations along with some information technology and compliance personnel.

With Dinallo's support, Nieves said the number of networking groups have grown, including for black, gay and transgender employees.

She also created a diversity and inclusion council within the department that has 18 members representing all ethnicities, religions, gender and sexual orientation. The council is in the process of starting its first mentoring pilot program. Its members also serve as representatives to various minority bar associations and community groups.

To accomplish another goal, Dinallo brought with him Eric Hartline, a 16-year veteran at Debevoise, and named him second vice president and counsel in charge of legal operations and strategic initiatives. The unit has had an immediate impact, especially on the department's litigation and compliance teams.

Litigation chief Sean Quinn says his team used data analytics to negotiate multiyear preferred provider discounts with the law firms that had provided the best and most efficient service. The team reduced the number of litigation firms by 60%, and Guardian's litigation costs last year were reduced by 30% over prior years.

Quinn says the department undertook 15 projects to create efficiencies. The department dropped from 172 members in 2017 to 107 last year while still handling more work. “We went down in the number of lawyers,” he says, “but still improved our performance. We make better decisions, quicker, and without litigation.”

For example, the increased efficiencies allowed inside counsel to handle approximately 20% of all new litigation and prelitigation matters internally, without the need to retain outside counsel, according to Quinn.

Guardian outside counsel and litigator Thomas Hetherington, a name partner at McDowell Hetherington in Houston, has a national practice with a specialty in insurance law. Hetherington says he finds Guardian “unique in the corporate world” in its devotion to taking care of its policyholders.

“It permeates the legal department and the litigation team is very committed to it,” he says. “I can't tell you how many times they have said it to me. They preach it and they believe it.” Hetherington says the company was smart in paring down its outside counsel to those who really understand their business. He describes their litigation department as very talented, intensely collaborative and efficient.

“And they are true champions of diversity,” he adds. “A lot of companies say it, but they really do it. They push all their outside law firms annually for diversity surveys, and they talk to us about the importance of diversity in our outside counsel meetings.”

Another in-house counsel seeing automation affect her team is Noreen Fierro, senior vice president and chief ethics and compliance officer. “For the first time when we think of a new compliance process, our first question is, can we automate this. We partner with the Indian operations to leverage our technology.”

Fierro says partnering with India has created efficiencies for her unit. “First there's the time difference,” she says. “We can ask them for work when we leave at end of day and it's ready for us when we come in the next day. They are very qualified and educated individuals.”

Automation has also meant other savings in compliance this year. “We implemented a single customer complaint portal and were able to decommission three other systems. We're still pulling together the amount of savings,” Fierro says. As people's jobs are replaced by automation, she says the company “repurposes” them in other jobs.

Besides bringing automation, Dinallo also encouraged Fierro to pursue a consultative and collaborative approach to compliance, “as opposed to being the 'no' department,” she says. “Members of my executive team sit on executive committees throughout the company.”

She says Dinallo, who formerly served as superintendent of insurance for New York State, global head of regulatory affairs at Morgan Stanley and general counsel at Willis Group Holdings, has been her biggest proponent “so that we can support the business in a meaningful way,” she says. “He's been in compliance during his career, so he gets it.”