Broader GC roles will mean ‘the death of legal professional privilege’
General counsel generally agree that the in-house team should have expanded roles, but this should not manifest by way of an “unnatural widening”, according to KPMG Australia Forensic.
In recent think tank sessions hosted with “over 150 GCs and senior in-house counsel”, KPMG Australia Forensic determined that when things go wrong, it is “invariably the in-house legal team who is left to collect the proverbial pieces”.
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However, one GC that KPMG spoke with said that “broader roles for the GC [mean] the death of legal professional privilege”, the firm said.
“Whilst GCs broadly thought there should be expanded roles for the in-house counsel, they cautioned against an ‘unnatural widening’ of the role that could compromise the sacred sanctum of client-lawyer relationships,” it noted.
“It was contended that the dilution of the core legal advice function risked dismantling the fundamental framework for the provision of advice.”
According to KPMG Australia Forensic partner-in-charge Martin Dougall, ensuring that communication with and from the GC stays privileged is “critical”.
“We are in the trenches with the GC when things go wrong; we are imaging corporate IT assets, working out who said what to whom, where a phone was at a particular time and finding financial transactions buried deep in a company’s accounts,” he explained.
“We rely heavily on the GC to guide us through the legal issues while we navigate the accounting, investigative and technology aspects. Our work helps frame their professional legal advice that [organisations] desperately need. Ensuring those communications are privileged is critical.”
Coming out of the same think tank sessions, KPMG partner Dean Mitchell told Lawyers Weekly that, increasingly, general counsel are called upon to “calibrate the compass” of an organisation’s morals, but delegating such responsibility to the legal department leader runs the risk of giving other employees across the board a free pass.
“We spend a great deal of our time helping these GCs resolve some pretty tough foreign bribery, fraud, commercial dispute and product remediation challenges; with all of this on their plates that didn’t always leave a great deal of time for in-house counsel to think about their own roles strategically. We wanted to create a time and space for them to do just that,” he outlined.