In search of judgment: Corporate legal leadership

The chief legal officer’s competing priorities

Today’s chief legal officer does much more than clear legal hurdles and react o crises. Eighty percent of chief legal officers report directly to the chief executive officer (CEO)—and whatever their reporting structure, chief legal officers are increasingly expected to offer strategic advice and insight to both the C-suite and the board.

In fact, Deloitte's research shows that CEOs expect chief legal officers to spend 60 percent to 70 percent of their time focused on strategic or catalytic endeavors at the enterprise level. At the same time, they’re charged with running the organization’s day-to-day legal operations efficiently and managing teams to address both routine and emergent legal issues.

These competing pressures mean that chief legal officers may frequently bridge two conflicting (but coexisting) environments:

• A traditional, reactive environment focused on responding to problems in real time
• A rapidly evolving, new setting that requires a future-focused, innovative, and strategically engaged mindset

To meaningfully advise the C-suite, chief legal officers must be seen as trusted collaborators, not just legal problem-solvers. Earning trust at this level requires, first and foremost, the consistent exercise of good judgment. The exercise of judgment is critical to analyzing issues and problem-solving; not surprisingly, it was ranked as the second most important competency for legal leadership, trailing only behind integrity and honesty. But ask any professional about judgment and you’ll likely hear, "I know it when I see it" or "I certainly know when it’s missing." But what, really, is judgment?

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Recognizing judgment

Despite the availability of extensive guidance on the principles of leadership, management, and optimizing team function, a notion persists that "judgment"—one of the most critical executive skills leaders can develop—can somehow be evaluated based entirely on the observer’s "gut feeling." This approach also implies that there’s no real way to teach "judgment skills" (an idea that should alarm anyone concerned with developing future leaders). The logic goes something like this:

• Experience hones judgment
• Those with experience have, by definition, gained judgment skills
• Thus, having experience-based knowledge enables them to recognize good judgment in others

But that’s not always true. We’ve all seen the long-tenured worker who mysteriously remains employed despite offering little in the way of valuable insight or ideas. Everyone’s met a senior leader whose judgment is unsound and untrusted despite years on the job. Common sense tells us that experience alone does not automatically translate to strong judgment. And, more importantly, the mere experience is inadequate when it comes to enabling junior team members to develop a crucial judgment-focused skill set.

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Strengthening judgment

After a comprehensive analysis, Sir Andrew Likierman of the London Business School drew the following conclusions with respect to defining the components and behaviors that underlie good judgment: The exercise of judgment draws on six discrete but interwoven components (see chart below), and each component relates to:

• The information people take in (Learning and Trust)
• How they integrate that information with their existing knowledge and views (Experience and Detachment)
• How they then draw conclusions and make decisions (Options and Delivery)

These components support this useful working definition of judgment: "the ability to combine personal qualities with relevant knowledge and experience to form opinions and make decisions." Examining any one of these areas will yield ideas for how to strengthen judgment skills; sometimes it can be as straightforward as becoming a bit more self-aware or making small adjustments to one’s habits.

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Key skills development for chief legal officers

The facets of trust and detachment offer some challenging—but possibly higher-impact—areas for chief legal officers to enhance their judgment expertise. Sharpening these can go beyond reinforcing already solid practices like active listening or knowing the limits of one’s past experience. Instead, increasing proficiency here can require higher-order thinking that could actually be at odds with one’s own instincts.

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Trust: Soliciting diverse perspectives

Trust in this context hinges on the notion that your judgment is strengthened by being surrounded by a "team of rivals" who bring a range of perspectives to any given problem. Seeking a diversity of views, rather than confirmation of what you already think, is paramount, so having a trusted pool of willing contrarians is a foundational element. This is, however, easier said than done. Not only do you need to put aside your own ego and show some enthusiasm for being challenged, but you must also create an environment in which people feel safe to do so.

This may be easier for some people than others. Our earlier article on Business Chemistry highlighted many in-house counsels are Guardians or Integrators (collectively they represent two-thirds of the in-house workforce)—that is they prefer a less confrontational approach to work. For those who share this preference, intentionally creating contrarian views maybe even more challenging than for others. But effective legal leadership avoids a judgment-weakening echo chamber by actively fostering a culture of dissent.

Detachment: Addressing cognitive bias

Effectively exercising detachment skills involves recognizing and stepping back (both emotionally and intellectually) from your own biases. Our values, experiences, and beliefs can and should shape how we make decisions, but also shape our impressions of new information and ideas. These and other thinking-related biases shape our decisions, and we’re probably not even aware of them.

"Cognitive biases" are systematic mental shortcuts. We all rely on them, and human beings developed them for good reason. Our brains cannot individually process the massive amounts of data coming at us in any given moment; without some shortcuts, our ability to make decisions would be paralyzed. These mental devices provide a set of unconscious “rules” that enable the brain to work more efficiently.

But there’s a catch: While cognitive biases do expedite decision-making, they are generally irrational. This means they may lead people to make inaccurate judgments (often while being deeply convinced that they’re correct or that their decision-making isn’t affected by bias). Moreover, these biases are socially informed and socially reinforced, meaning that erroneous information from the social world gets embedded into the brain’s unconscious decision-making methods.

Of course, you can’t switch off the subconscious activities that take place in your brain. But you can build systems and processes that may help you and your teams double-check where cognitive biases might be unduly influencing decisions.

Key takeaways

Chief legal officers who can recognize the many facets of judgment are likely to be best positioned both to lead and develop corporate legal departments and to provide high-level, sound advice to the C-suite at a strategic level. For significant strengths development, chief legal officers should reexamine the practices of their own teams and their leadership teams with an eye toward improving decision-making across the board. Fostering trust by encouraging a diversity of views and learning to spot and interrupt cognitive biases are two very good starting points.

To learn more, read: In search of judgment

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