Profiles of CLS Alumni General Counsels

Profiles of CLS Alumni General Counsels

> James Brumm '68
> George Madison '80
> Lawrence Purtell '72
> Brad Smith '84
> Esta Stecher '82


Executive Vice President and General Counsel
Mitsubishi International Corporation

Mitsubishi International Corporation's legal department - with six attorneys - may be small, but the scope of responsibilities overseen by James Brumm '68 is broad. It frequently takes him from his office in New York to Europe, China, and parent company Mitsubishi Corporation's offices in Tokyo.

The first American named to the board of directors of Mitsubishi Corporation, Mr. Brumm has been with the company since 1977. As general counsel, his responsibilities include more than just legal matters; they encompass environmental and social responsibility issues, as well as external affairs and public relations. He also serves as president of Mitsubishi International Corporation Foundation, which supports causes related to the environment, human rights, and poverty alleviation.

"As counselor to the company, there's a large non-legal component relating to the company's obligation to society and the environment," he notes. "You have to develop an approach that asks what is your responsibility as a corporation, not just your legal liability."

Mr. Brumm ran the legal department as a general manager - following the Japanese corporate model - until 1995, when he turned over day-to-day operations to a staff member. "I'm no longer purely a lawyer; I'm actively involved in managing the company," he says.

Mitsubishi International uses outside counsel for all litigation matters, raising other policy issues.
"An outside litigator wants to win, but sometimes it may be in the company's best interests to settle," he explains. "You need to manage outside firms to be sure the company is getting top-quality service at a good price, and to make sure the advice given by outside counsel is properly inter-preted."

Ten years ago, the company was the target of environmental groups on an issue related to rainforests. "By default, I developed an expertise in liquefied natural gas and have continued to take on those issues on a worldwide basis for Mitsubishi," he says.

Interpreting the U.S. legal system, as well as social systems, for a largely Japanese management structure - both in the U.S. operation and the parent corporation - is another challenge.

"It's important to help management understand how to protect themselves and the company in the context of the U.S. legal system," he says. "For instance, oral agreements are not enforceable here. A client will come to me and say, ‘But he told me over the phone this is what we'd do.'

"I am working in a bicultural company," he concludes. "I like to think of myself as a bridge between East and West."


Executive Vice President/General Counsel

With a degree in business and an MBA earned before he entered law school, George Madison '80 viewed a career in corporate law as inevitable. As a partner at Mayer, Brown for 10 years, he helped set up a branch office in New York - an entrepreneurial experience that cemented his interest in becoming a general counsel.

"Early on in practice, I [was attracted to] what the clients were doing," he says. " I enjoyed the advisory aspects, problem-solving, and the intellectual rigor of practicing law. So I realized the best client job was that of general counsel or chief executive."

As general counsel for the not-for-profit financial-services giant TIAA-CREF - which operates as an issuer of securities, insurance company, lender, and real estate holder - Mr. Madison deals with a variety of issues. He manages a team of 250 people in the compliance and legal departments sprinkled around the country. He also oversees outside counsel, who conduct about 40 percent of the company's legal matters.

"You have to be ready for the known things, the usual suspects, and the unusual, too," he says. "For instance, you may have a shipping magnate bring a criminal claim against you in Greece and try to have your directors arrested for exercising the company's rights in the United States."

While he says TIAA-CREF is not often sued in comparison to other large companies, in his experience most general counsels spend one-quarter to one-third of their time on lawsuits.

Mr. Madison also devotes considerable time to advising senior management and the board of directors on legal issues and business strategies. "Your judgment is as important as your experience," notes Mr. Madison, who previously was general counsel at Comerica Incorporated.

TIAA-CREF's board members, says Mr. Madison, are "very smart, very accomplished people not afraid to ask tough questions. Businesspeople always want you to give odds on success or failure. To have credibility, you have to be right 95 percent of the time."

One of his most critical responsibilities is preserving the reputation of the company. He estimates a 400-500 percent increase in regulatory exams due to the recent mutual-fund and insurance scandals in America.

"Whether or not the government thinks you're a good corporate citizen can seriously affect your reputation," he explains. "The general counsel plays a big role in setting the company's relationships with regulatory agencies and other constituents."


Executive Vice President and General Counsel
Alcoa, Inc.

On any given day, Lawrence Purtell '72 may deal with transactions, personnel issues, and outside counsel handling commercial or patent litigation, not to mention advising senior colleagues on business matters.

"I guess that's why they call it general counsel," says Mr. Purtell, who heads a team of 75 lawyers worldwide for Alcoa, Inc., the world's largest producer of aluminum and aluminum products.

"You deal with the same range of issues, even across different industries," says Mr. Purtell, a former mergers and acquisitions lawyer at White & Case.

"As general counsel, you have the best of both worlds," he says. "You have the intellectual stimulation and excitement of working on major transactions, but they are episodic, so there are some periods when the work is not as intense. At a law firm, it's 52 weeks a year."

Another significant difference between working at a major law firm and running an in-house corporate legal department is the depth of knowledge about the client.

"Being general counsel enables you to give more effective and efficient legal advice," he notes. "You can get to the issue at hand rather than having to go through the history of the organization and the players involved."

This era of heightened corporate scrutiny has made a general counsel's breadth of knowledge and judgment essential.

"The corporate scandals such as Enron, WorldCom, and Tyco - along with the Sarbanes-Oxley Act - have demanded more time from corporate counsels, CEOs, and boards of directors on corporate compliance," he explains. "This issue has re-prioritized my time."

While compliance used to take up 15 percent of an average day, it now constitutes a third of his workload.
Being part of the senior management team, Mr. Purtell's responsibilities encompass far more than purely legal matters. "The most successful general counsels I know make sure the legal issues are addressed, but are also creative in coming up with business solutions, helping the client achieve its objectives," he adds.

"You want the CEO to consider his lawyer as one of the people he wants to pull in as a valued member of the senior management team. You have to be willing to take risks, be proactive, and suggest creative solutions. There's some element of personal risk involved in that."


Senior Vice President, General Counsel, and Corporate Secretary
Microsoft Corporation

International diplomat, enforcer, defender, and business strategist are some of the roles Brad Smith '84 plays as general counsel at Microsoft Corporation, where he oversees a legal and corporate affairs department of 850 people.

"There's never a dull moment," he says.

Mr. Smith is responsible for Microsoft's implementation of the consent decree established in 2001 with the Department of Justice and state attorneys general, which is resolving a number of antitrust controversies against the company that arose over the past decade. He also oversaw Microsoft's 2003-05 negotiations which settled the company's differences with AOL Time Warner, Sun Microsystems, and other companies. As board secretary and chief compliance officer, he is involved in all corporate governance and public compliance issues.
Microsoft files several thousand lawsuits in more than 90 countries every year to protect its products from piracy and counterfeiting, and it has stepped up its investigations of viruses, hacking, and spamming. The company also files 3,000 patent applications each year in the United States alone, making it the third largest registrant to the U.S. Trade and Patent office.

"The entire industry is driven by intellectual property law," Mr. Smith explains. "The thing about software is it's hard to create and easy to copy."

The global nature of the software business and the Internet gives rise to another big challenge: conflict of laws.
"Multiple governments are all considering an array of regulations at the same time," says Mr. Smith. "We try to encourage governments to retain some degree of consistency. The work amounts to an international diplomatic effort."

A significant part of Mr. Smith's job involves helping the company - and the law - adapt to changes in the development of consumer expectations and technology itself. For instance, Mr. Smith spearheaded efforts to revise the company's contracts to make them more customer-friendly.

"As technology has... become widespread, we've seen the law adapt to technology," he explains. "It's a fluid process. As lawyers, we not only advise on where the law is now, but we also predict and help shape where it is going."

Being a general counsel also requires the capacity to remain level-headed in the face of the unforeseen crises inevitable in any business.

"You have to maintain a sense of calmness," says Mr. Smith. "A general counsel must ask the right questions and remain thoughtful and rational, even when the rest of the world seems a bit off-kilter."


Executive Vice President and General Counsel
The Goldman Sachs Group, Inc

With financial services providers under increased scrutiny everywhere, Esta Stecher '82 and her team of 200 attorneys - located in 11 offices around the globe - have their work cut out for them.

"I spend a large portion of my waking hours - and probably some sleeping ones - focusing on our legal and ethical obligations," she says. "Our industry is highly regulated, but ethics encompasses much more than strict compliance with the law. It includes things like fairness and honesty - even when the disclosure may be embarrassing or costly to oneself." It also involves "good faith in business dealings and the discipline not to exploit an unfair com-mercial advantage even when this can be done with legal impunity," she adds.

Among recently implemented laws and regulations with significant implications for financial services companies are securities reform legislation and regulations, anti-money laundering legislation and regulations, and the Sarbanes-Oxley Act, she notes.

"In addition, many practices in our industry that were once regarded as standard have come under scrutiny and reform - for example, the interaction between investment bankers and research analysts," adds Ms. Stecher. "A significant challenge we face as a legal department is adapting to changing and evolving standards that apply to our industry and reinforcing the understanding that it is not enough for us to abide by the letter of the law alone."

The company's legal department is organized into practice areas that support each of its businesses, such as equities, asset management, private wealth management, and merchant banking. Other practice groups in the department provide core legal functions - such as litigation and employment law - for the entire operation. Ms. Stecher's department manages legal issues in the United States and in 26 other countries where Goldman Sachs operates.

While her work includes reviewing and vetting business practices and advising in the pursuit of new business opportunities, foremost on her agenda is protecting the corporate reputation.

"Organizations must establish a culture in which no employee is left in any doubt that placing the firm's business reputation at risk in order to gain a temporary commercial advantage is intolerable," says Ms. Stecher.