Canadian Lawyer InHouse

I think there is a view that you simply have to spend money on in-house counsel, and it's an investment and part of a maturing company. think the legal spend has been flat. As a growing organization, I think that is an accomplishment. MARK JOHNSON, Infusion MEHES: I think driving down internal DURAND: Always when you're hiring you're hoping the person will go on to great things within the organization. I think you do look for slightly different things — I look for a genuine interest in the business. There is still that myth out there that we have a cushier lifestyle than some of our counterparts at law firms, and it is a myth. I'm always a bit leery of people making the leap for that reason. It is a different risk of tolerance on a personal level. I do some amateur testing on how comfortable people are in making decisions and with ambiguity. That tests whether this is going to be a workable environment for them. JOHNSON: It's a completely different job than working at an external firm. When you're in-house you are not only the adviser but you have to decide on the risk. In a law firm you can push off the decision to the client. Those coming in-house need to be comfortable giving definitive advice. MEHES: I look for judgment and communications skills more than even experience. I have hired a lot of people with no prior experience in the pharmaceutical industry. I started out as a litigator but I have done M&A and other things that most litigators don't get to do, and you become a generalist. To me the real challenge in succession planning is finding someone willing to become a generalist. I also typically hire in that threeto-five year associate range and the goal is to expose them — bring them in to shadow litigation and vice versa. I want everyone to understand the whole of the busi- 22 • a u gu st 2013 ness and the whole of the legal work, and it takes time. AHMED: I remember when I started in- house the general counsel who hired me was a litigator, and I think that is becoming more and more common, because litigators are used to going into a role where they will be in new situations all the time, and I think litigators have good training in that respect. So you are looking for people that are really interested in the business perspective and gaining that strategic perspective and will fit with the team. INHOUSE: When you add personnel are you asked to reduce your external legal budget? LEWIS: Certainly that is in everyone's mind. We want to do that. The way I look at it, when I want to reduce cost I look at the sorts of things that we can do in-house that are really ancillary to our local business function. Overall, because of the great increase in activity by the university, I think we have not cut down on our external budget because we have taken on initiatives and all of these things are large projects requiring expertise. So the finance side of it is important but not the driver. ALLGOOD: I view internal and external as part of the whole in order to provide the right legal services to the organization. It's not necessarily a direct substitution, but it is management of both processes. You will always need outside counsel, but I do have views and opinions on how efficient they are. We have been involved with the ACC [Association of Corporate Counsel] and working with the law firms to try to get them to be more efficient in the way they provide legal services. Over the last five years, I INHOUSE legal costs is one factor, but I have an antidote which came from the global general counsel of Teva who hired me eight years ago, who is essentially running, in a sense, a law firm globally. What he said when he was making the business case for hiring me — the first lawyer in Canada — he was asked by the Canadian CEO: Does this mean I will spend less externally? His answer was no. You will spend more. The reason is we have a lot of litigation. He said "she will be getting very involved in that. She will manage the dayto-day, meeting with the lawyers. She will be asking a lot of questions." So at the end of the day, it may in fact slightly increase your legal costs, but the outcomes will be better and in the long run you will have a more successful business. JOHNSON: I think there is a view that you simply have to spend money on inhouse counsel, and it's an investment and part of a maturing company. We have been able to reduce external legal costs and the biggest external cost was on immigration matters, but I agree that it produces better outcomes. The company should stop viewing it purely as a cost centre. The company matures and it's part of the team. Having said that, we do look for cost reductions one way or the other from external counsel. AHMAD: We are a not-for-profit so we want to maximize every dollar and that drives everything we do, but at the same time our organization is always growing. There is an understanding that that sometimes you have to bring people on or external counsel will focus on something in particular. In particular for us because we have the legal group helping to obtain tariffs there is a recognition that there is an investment and you have to invest in those things.

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