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The duties have multiplied—and titles, too—but compensation for GCs is rising again
After a few comparably lean years, the compensation gods once again are smiling down at general counsels in large public companies.
Marshall T. Scott is a senior executive pay consultant with Towers Watson in Chicago who advises large companies on their executive pay programs. He says that overall worth for GC in large public companies have gone up both literally and monetarily.
"Going back a few years, there is more value going to the general counsel's position and it's somewhat driven by the industry," he says. "With all the new regulations in the financial services industry, for instance, the role of the GC has become more valuable and valued. It's the same where intellectual property factors in heavily and you need a GC who can defend and understand the new regulations. GCs who do a lot of regular transactions, special litigation and environmental law are seeing a nice bump in their compensation."
Steven Slutsky, a principal and compensation consultant for PricewaterhouseCoopers Human Resource Services in Philadelphia, agrees that the role of the GC has expanded, and with it, compensation.
"There is a trend that we are seeing among certain industries, such as financial services and other highly regulated ones, for an increase in income because the GC role is expanding," Slutsky says. "The GC is taking on a larger role because of greater regulatory issues, environmental issues and the increased scrutiny of shareholders and stakeholders. They are getting more recognition for having a seat at the table."
In addition, more GCs are taking on additional business and operational responsibilities, he says. "They are getting to run business units and have more of a role in planning overall strategy rather than simply offering legal advice," Slutsky says. "And, with that, of course, comes more monetary compensation."
As this occurs—GCs running business units—Slutsky says he believes more GC eventually will become CEOs. "I think that will be a slow process but over time, I think that will occur more. Certainly not in the next two years or so, but traditionally running business units helps gets you the top chair."
Several of the top general counsel on the Daily Report's annual compensation list had multiple titles. Just in Georgia, seven out of the top 10 highest compensated GC also were the company's secretary and in some cases, also chief administrative officer.
Also factoring into the GC salary bump is that a corporate position is becoming more attractive to top lawyers.
"The recruitment of general counsels is much more active than it has been in the prior two years," says Joel Koblentz, CEO of the Koblentz Group, an executive search firm. Koblentz handled the recent placement of Beth Chandler as general counsel for Rollins. "They are attracting talent and are having to compete for it. The competency of the candidate pool has gone up and corporations are having to pay a premium to attract them."