May 20, 2014

Should the General Counsel Also Serve as the Corporate Secretary?

Recently, I blogged about “No, GCs Should Not Be on the Board” and heard from many members in response. One response was from Zix Corp’s Jim Brashear who noted this recap of a recent Lead Directors Network meeting, highlighting this section that jumped out at him:

There were differing views in the meeting about whether GCs should also be the corporate secretary. Several GCs said that it was important for the GC to serve as corporate secretary: “Without that role, there’s a disconnect between the general counsel and the board,” one GC said. GCs agreed that if another individual was corporate secretary, even if they reported to the GC, that person would naturally spend more time with board directors than the GC.

However, other GCs noted the benefits of separating the two roles. At the meeting, a GC who is not corporate secretary said that the corporate secretary role “is very substantive and demanding if done properly. When someone else handles those responsibilities, it frees me up to be a better member of management.”

Jim gave his ten cents as follows: “I’ve been in situations where I have acted in different roles, such as corporate secretary but without the title; corporate secretary but with a separate GC; and both corporate secretary and GC. The GC should have plenty of engagement with the directors on legal issues even without having the corporate secretary role. The GC should be in the boardroom in that capacity, except during executive sessions. Same with the corporate secretary. It should not be a choose-one-or-the-other decision.

I completely agree with the quote about the corporate secretary role being substantive and it’s quite demanding if done properly. If the GC does not have the expertise to be the chief governance officer and someone else in the organization does, then the GC should not have the title or perform the function. Did you know that there are some highly esteemed folks that serve in the corporate secretary role who are not invited to their board meetings and must draft minutes using someone else’s notes, usually the GC’s? Crazy.

Whether the job should be split also depends in part on: size of the legal department, level of specialization within it and demands of the GC’s other roles in the organization (e.g., Chief Administration Officer, Chief Legal Officer, Chief Compliance Officer, Chief Privacy Officer).”

Webcast: “Big Changes Afoot: How to Handle a SEC Enforcement Inquiry Now”

Tune in tomorrow for the webcast – “Big Changes Afoot: How to Handle a SEC Enforcement Inquiry Now” – to hear Dixie Johnson of King & Spalding; Randall Lee of WilmerHale and Tom Newkirk of Jenner & Block get us up to speed on the latest about the SEC’s Enforcement Division and provide practice pointers on what approaches work for many different types of investigations that exist today. This is a hot topic. Just yesterday, SEC Chair White delivered this speech entitled “Three Key Pressure Points in the Current Enforcement Environment”…

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– Broc Romanek