New study shows rising prominence of lawyers in corporate CEO roles
Top UK and US corporates are increasingly turning to the legal profession to fill senior leadership roles, according to a new research project carried out by Reed Smith and KPMG. The report, which looked at CEO appointments at FTSE 100 and Fortune 100 companies over the last decade, highlights a steady rise in the numbers of CEOs who have either studied law or gone on to qualify as a practitioner...
March 26, 2013 at 10:05 AM
3 minute read
Top UK and US corporates are increasingly turning to the legal profession to fill senior leadership roles, according to a new research project carried out by Reed Smith and KPMG.
The report, which looked at CEO appointments at FTSE 100 and Fortune 100 companies over the last decade, highlights a steady rise in the numbers of CEOs who have either studied law or gone on to qualify as a practitioner. Between 2002 and 2012, the number rose from three to seven in the FTSE 100, and from 10 to 17 among the Fortune 100.
CEOs with a legal background are currently represented on the boards of a broad range of industries including aerospace, pharma, publishing, retail, and oil and gas, with high-profile US examples including Fannie Mae CEO Tim Mayopoulos, who previously worked as GC of Bank of America, and Delta Airlines CEO and former Continental Airlines GC Richard Anderson (pictured).
The research project, 'Leader Board: Leadership Beyond the Law', which was chaired by former InBev Western Europe general counsel Deepak Malhotra, canvassed stakeholders including business leaders, GCs, law firm partners and HR professionals.
According to the study, factors contributing to the rise of lawyer representation at CEO level include growing regulatory demands and the increasing importance of understanding and managing risk, as well as the trend for MBA-style business learning to be incorporated into legal training.
The report also suggests legal education in its current form should offer an increased focus on general business, in order to create "more rounded business-savvy lawyers and also offer alternative career choices to those with general business aspirations".
"The skills of practising lawyers are increasingly recognised in business and how they embody the characteristics of an effective leader," said Reed Smith L&D director Nigel Spencer. "There is a great opportunity for the legal profession to do more to foster these skills and have a meaningful impact on the broader business community."
Spencer pointed to Reed Smith's development of the Legal Practice Course into a Master's course with business modules as an important step in developing commercial skills among trainee lawyers. A number of other law firms, including Simmons & Simmons and Eversheds, have incorporated aspects of MBA-style training for their junior lawyers.
"One of the things to come out in the report is that lawyers build a lot of these skills in their daily work," Spencer added. "The analysis of risk and reward necessitates a commercial mindset. In an in-house role you are be physically closer to the business but, in private practice, you can build that linkage too: the whole process of lawyers being on secondments at clients helps to make sure our teams build that front line, on-the-job commercial experience, and helps to understand that key question: "What does my advice get used for?"
Malhotra added: "There's no reason in my mind why ambitious lawyers' horizons shouldn't be fully cultivated; more should be done by the legal community as a whole to bring on the next generation of leader. We should not expect or wait for the business community to knock on our door, and more needs to be done holistically and across the community to get that done."
Click here to access the full report.
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