Law And More

Controversy - Former Googler Patrick Shyu Goes for Broke (and how social networks have made mean-spirited cool)

The promotional power of controversy is well-known. But, what is also a pragmatic reality is that it is a marketing/public relations tool which has to be carefully managed.

Recently, as Insider reports, former Googler Patrick Shyu has, well, gone for broke in leveraging his use of controversy to get, retain, and grow subscribers for his YouTube Tech Lead Show.

On Twitter, in posts which he had since deleted, he gushed about how he used to tell females interviewing for coding positions at Google to go home and have babies. Yes, he contends to have actually said that, in real time. In addition, he had tweeted, also since deleted, why women shouldn't code. 

Here is Shyu's LinkedIn site, on which he has 61,285 followers.

Whether there will be an escalation of subscribers to his subscription service or a flight out - only time will tell. In the current ethos of mean-spirited everything many might be attracted to Shyi's world view and his crass way of putting it out there. Social networks have elevated what is mean-spirited to the new cool. 

When toxic Gawker collapsed my kind cheered. We hoped that was the end of that. However, it taught well other promoters how to push the envelope on mean to succeed. 

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com. 

Howdy Partner, Likely You're White & Male (Source: 2021 ABA Model Diversity Survey)

Given how the "Free Market" system (and politics) of how most law firms operate, the findings of the 2021 ABA Model Diversity Survey are no surprise.

Here are the key ones which pertain to all sizes of law firms in all geographic locations:

• White lawyers were almost twice as likely to make partner than non-whites.
• Males lawyers were twice as likely to make partner than women. Women constitute 25.1% of partnerships, up from 24.2% the year before.
• Black attorneys constitute 2% of partners.

One factor which might play a significant role in this reality is what is known as the "Free Market System." In that, partners have the decision-making power to assign work to associates. That has profound implications for associates. Those include:

• Ability to generate billable hours
• Availability of learning experiences. Those are critical to professional development. Law is a hands-on line of work. One learns by doing. 
• Access to the kinds of assignments which create visibility and contacts within the firm, on external networks, and in the media. 
• Being on the types of accounts which are considered seminal in creating revenue/profit, maintaining a lucrative account, and developing new business. Not all client work is created equal. And not all put associates on the partner path.

Partners, like all the rest of us, are human. Amid such a stressful/deadline-driven profession they could find it "easy" to make assignments to those they feel comfortable with. That entails the ability to "size up" what those associates are all about. They may not conclude that they can "read" associates from outside their traditional professional and social networks. So, they stick with the known entities.

In subcontracting work for my communications boutique I also select those whom I conclude I "know." I don't welcome surprises in attitude or behavior. As an entrepreneur I deal with too much pressure. 

This is a hard nut to crack.

The Mansfield Rule, created by the Diversity Lab, specifies that in promotion decisions law firms will consider in the pool 30% diverse candidates. Some firms have adopted that rule.

But the human factor probably still dominates. Navigating outside one's comfort zone involves risk. With so much uncertainty professionals are not very open to taking on more of that.

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com.

The Purpose-Driven Corporation in Era of ESG: But, What Is the Purpose and What Are the "Right" ESG Values?

It's the buzzy phrase: the purpose-driven corporation. Recently, Forbes connected the dots on that and Environmental Social Governance (ESG) values. It indicated that leading with purpose is the key to ESG.

AMBIGUITY ABOUT PURPOSE OF CORPORATION, ESG VALUES

Unfortunately, there is no consensus about (1) what is the purpose of the corporation and (2) what is the right thing to think and to implement as behavior. ESG has fragmented into myriad mandates about corporate values and conduct.

IN-HOUSE LEGAL

Meanwhile, in-house legal has to guide the corporation and its individual departments through everything from daily decisions to governance. Simultaneously, as Wall Street law firm Paul Weiss hammered last January in Corporate Counsel, ESG itself has changed how in-house lawyers should approach and do law. 

THE 4-POINT GUIDE

How to do that? In that Cororate Counsel article, Paul Weiss Chairperson Brad Karp and the law firm's Chief Sustainability-ESG Officer David Curran provided a 4-point guide:

Reinvent Playbooks. The conventional ways are no longer adequate. That is primarily because ESG issues spill over to multiple corporate departments and lines of business. 

They recommend:

"Legal teams must be involved with HR, investor relations, finance, and business units to encounter ESG issues. Lawyers are in an ideal position to coordinate disparate parts of an organization and fill important gaps."

Ensure Department Membres Understand the Unique Aspects of ESG. Because there are so many gray areas in ESG, traditional methods of conducting legal business have become anachronistic. Those old approaches, of course, are: researching precedent and applying law. What is needed is the ability to have an interdisciplinary mindset and experience leveraging that. Among other competences in-house lawyers need, hammer Karp and Curran are to:

" ... make sure public disclosures align with ESG goals, structure board committees to oversee ESG risks and opportunities, and develop systems for monitoring and measuring ESG progress."

Validate ESG Data. So much depends on that, ranging from conformance to ESG metrics to the criteria required for Sustainable Investments. The growth of that investment niche depends on how that data is configured.

 Karp and Curran posit: "Lawyers can pressure test their data using many of the same models and compliance frameworks developed to ensure that companies are in compliance with anti-corruption laws."

Be Aware of ESG Risks in Mergers and Acquisitions and IPOs. Much of ESG is still new to lawyers. Therefore, it is all too easy for them to "not look" where the risks can be to corporations in this new era of ESG values. They could miss what might not have been a red flag in pre-ESG times. Essentially, so much has changed. 

They warn:

"All it takes is one weak link in a supply-chain agreement or a board member's past bad behavior - to break the chain and put the company's reputation at risk."

SHIFTING OUT OF ABSOLUTES

Obviously, just about everything associated with ESG is a work-in-progress. Absolutes have no place in that. Those range from the rhetoric to the scope of the in-house legal department.

Over the years Jane Genova has covered major corporations. Now and then she does freelance communications assignments for Paul Weiss and a number of other law firms, both defense and plaintiff. Connect with Jane at janegenova374@gmail.com.

ESG Reaches into NDAs - Paul Weiss Had Warned In-House Lawyers of Those Kinds of Challenges

“ … software company Salesforce Inc., which employs 73,000 workers, announced Friday that its entire U.S. workforce will not be liable for violating an NDA [Nondisclosure Agreement] if they are discussing unlawful activity such as harassment or discrimination.” – Bloomberg, April 29, 2022

Salesforce is now off the hook for submitting a report on how that part of its NDA could be preventing disclosure of such matters. It had been encountering a proxy vote at its upcoming annual meeting to prepare such a report. The proposal has been dropped. At Apple, there is a similar shareholder proposal. In a regulatory filing, Alphabet indicated it has discontinued such a requirement.

Across businesses, a major driver for gutting the concealment clauses has come from shareholders and organizations representing them. That involves the governance part of ESG (Environmental Social Governance).

Of course, eliminating those provisions is considered, according to how current values have evolved, as the right thing to do.

But that whole ball of wax also involves risk to the value of the stock. That is a key issue in this era of the growing dominance of Sustainable Investments. According to Bloomberg, global ESG Investments could total $41 trillion this year. By 2025 that could balloon to $50 trillion. As played out at Activision Blizzard, allegations of wrongdoing in sexual matters can sink the stock – and do lots of other kinds of damage.

Last January, in Corporate Counsel, Wall Street law firm Paul Weiss Chairperson Brad Karp and Chief Sustainability-ESG Officer David Curran warn in-house legal departments of this. Their focus is how ESG has disrupted how lawyers must think about and practice law. Yes, it’s a game-changer. Explicitly, Karp and Curran state:

“[In ESG matters] When it comes to reputational risk, clues are often buried in places that lawyers don’t traditionally look. All it takes is one weak link – in a supply chain agreement or a board member’s past behavior – to break the chain and put a company’s reputation at risk.”

In Spring of 2022, Paul Weiss anticipated this kind of escalating threat to business. That’s when it established the first-ever in the legal sector a specialized Sustainability & ESG practice. Since then, as Law360 reports, other law firms have adopted that model.

In addition to the governance play-out in liberating employees from concealment clauses, state government has also stepped in. At least, those progressive states such as California and Washington. For example, in 2021 CA created the Silenced No More Act. However, its reach is limited to only workers in that particular state. Many businesses operate in multiple locations.

Modifying provisions which relate to disclosure of alleged wrongdoing could represent only the beginning of an urgent movement to rethink the NDA. In itself that could catch fire as a seminal ESG issue. After all, transparency by business is increasingly expected.

Law and More has special expertise in ESG trends and their implications. Editor-in-Chief Jane Genova now and then does freelance assignments for professional services firms such as Paul Weiss. Connect with her at janegenova374@gmail.com.

The Business of the Law Firm Is This: The Client's Business, With Legal Situation Being Only One Moving Part

Law firms, like so many other organizations - profit and non-profit - refer to themselves as "purpose-driven." Well that buzzy phrase better refer to something very pragmatic. That's the business of their clients. Not just the client's legal matter.

WE USED TO LAUGH ABOUT CASES WON, BUSINESSES COLLAPSING

The client's business wasn't always the business of a law firm. When I began covering trials in 2005, both lawyers and fellow bloggers/journalists used to joke about how big-name law firms would win tough cases. And then that client's business would collapse. Ha-ha. But the lawyers received great media coverage for the success. And went on to defend clients in similar legal situations. Yes, they had done their job well. 

That was then.

CLIENT ACCOUNTS NO LONGER “STICKY”

Currently, such an outcome - the business failure - would tarnish both the brands of the law firm and the legal team. A driver in that is this: The whole law firm – client relationship is being reimagined. With the client having the upper hand. The short version: The client expects more. And can get it.

Evidence of that is this: It is rare for client accounts to be considered “owned” by any one law firm or a partner or team of partners in it.

In an interview with Leaders, April 2022, Paul Weiss Chairperson Brad Karp put it this way: The “sticky” part is over. In the ungluing, the new normal is for clients to shop around, kicking the tires about how a legal situation will be managed, by what players in the firm, and at what cost. The macro issue has become: What overall value is the law firm creating for the client? 

BEING A BUSINESS PARTNER

A major chunk of the reconfiguration, Karp hammers, is that the client demands more than stand-alone legal services. Actually, the language has shifted to “solutions.” And that pertains to the business as a whole. The legal situation is simply one moving part in those complex dynamics. Since they are occurring in real time, the legal strategy part itself may change as the conditions of the business evolve. Karp describes that role as being a “business partner.”

This is the Paul Weiss mission: “We need to deeply understand our clients’ business goals, professional culture, key stakeholders and risk tolerance.”

NOT UNTHINKABLE

It is not unthinkable that there eventually will be the demand by the business that it emerges from a legal entanglement – litigation or transactional – better positioned than when it entered. Lawyers will be required to have in-depth knowledge of business.

Yes, that could disrupt how lawyers approach and practice law. Already that kind of shift is occurring in how in-house legal departments are managing ESG issues. In Corporate Counsel, Paul Weiss outlines how the “playbook” is being reinvented for the chaotic ESG era, when corporations fear being the “Next Disney.”

IMPLICATIONS FOR LEGAL EDUCATION

Law schools will have to prepare this current generation and future ones in very different ways about what is the role of the lawyer.

Meanwhile, simultaneously, how to approach law itself  is changing. The classic example is how ESG (Environmental Social and Governance) is upending traditional legalities. Karp, along with Paul Weiss Chief Sustainability - ESG Officer David Curran, notes in Corporate Counsel:

"The standard lawyerly approach - researching precedent and applying the law - does not work when it comes to advising in the gray areas of ESG."

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com. Now and then she does freelance assignments for professional services firms such as Paul Weiss.

ESG, Abortion, and Corporate Leadership - Proxy Season

“Corporate America reacts with near silence to draft abortion ruling. – Executives are reluctant to engage in one of the most divisive debates in US.” – Financial Times, May 5, 2022

PROXY SEASON

That’s on the one hand.

On the other hand, there are proxy proposals by both retail and activist investors related to what corporations are doing internally about abortion. Those corporate leaders, who aren’t saying much or anything, better be all-ears. This is proxy season. And it is an unusually active one for shareholders pushing back against abortion limits. The new protest chant for mobilizing support for retaining abortion rights could be: Buy stock.

Meanwhile corporations should anticipate that abortion could catapult them into being the “Next Disney.” Only on a different matter.

SEC POLICY CHANGE

One might say that the SEC set this in play.

Recently, reported Bloomberg Law, the SEC had made a policy shift. Essentially that will allow more retail and activist investors to place proposals about climate and social matters as a proxy. During 2021, the SEC had turned down 30% of corporations' requests to put the kibosh on those proposals. That means there are fewer approvals of the corporations' requests for "no-action letters." The situation has unraveled so quickly that some corporations have thrown in the towel in even asking for them.

ABORTION AS ESG MATTER

During this proxy season those shareholder proposals about defending abortion rights will speak up loud and clear to public companies about what is perceived to be the right thing to do on this issue. Yes, abortion has become an ESG (Environmental Social Governance) matter. Bloomberg Law notes:

"Walmart Inc., Lowe’s Cos., and TJX Cos. represent what’s potentially the tip of a burgeoning trend in shareholder activism in this area [abortion rights]: All three companies will face votes on proxy proposals in the coming weeks aimed at shaping internal policies related to abortion access."

 OVERALL, SHAREHOLDERS AS FRONT-LINE GAME-CHANGERS

In the January 2022 edition of Corporate Counsel, Paul Weiss Chairperson Brad Karp and David Curran, Co-Chair of the law firm’s Sustainability – ESG Advisory Practice, warned of this development. What they spell out is this:

“… companies are increasingly held accountable … by shareholders for their ESG performance. [These are] buoyed by support from large institutional investors and advisory firms such as Institutional Shareholder Services (ISS) and Glass Lewis ... Activist shareholders [are] winning proxy battles and gaining access to previously undisclosed documents. This is a game-changer.”

BEYOND THE RIGHT THING TO DO

The investor push on abortion rights might contain a big piece of self-interest. Abortion limits have evolved into a high-profile ESG matter. Therefore, that directly affects the acceptability and pricing of what are classified as “Sustainable Investments.” According to Bloomberg Intelligence, by 2025 ESG Investments could reach $53 trillion. That would represent more than one-third of the projected $140.5 trillion of the total assets under management.

A major risk in any Sustainable Investment is this: In that same Corporate Counsel article, Karp and Curran refer to “weak links.” The validity of an ESG investment could blow up if some aspect of corporate values or behavior – or that of members of its supply chain – conflicts with formal ESG criteria. Corporate mindsets or actions taken regarding abortion could mutate into such a weak link.

INTERSECTING FORCE FIELDS

So, here corporations are. They are being tossed around amid intersecting force fields. Those include the accelerating momentum of the ESG movement, the urgency of the abortion issue, activist shareholders, and the big money involved in Sustainable Investing.

This proxy season will be closely watched.

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com. Now and then she does freelance assignments for professional services firms such as Paul Weiss.

"ESG" As the Second Language of Business, Politics, and Law

Job number-one in parachuting into a career or starting a new position is this: Picking up on the language. That is, acquiring linguistic literacy.

TALKING THE ESG TALK

As ESG (Environmental Social Governance) values dominate the business, political, and law-related conversation, it’s necessary to have the terminology down cold.

Law firm Paul Weiss provides a comprehensive free guide for every aspect of that. Here is that lexicon.

PAUL WEISS WALKS YOU THROUGH THE LANGUAGE OF ESG

And here are the major categories covered by Paul Weiss in its unique ESG lexicon:

ESG Terminology

Topics Commonly Covered

General Investment Considerations

Environmental Terms

Reporting on ESG Metrics

Financing

Legislative Initiatives

LEGAL SECTOR’S FIRST SUSTAINABILITY – ESG PRACTICE

Two-plus years ago Paul Weiss Chairperson Brad Karp envisioned the challenges business would have navigating ESG values. He became the early mover in designing a specialized law firm practice for that. That is Paul Weiss’ Sustainability & Environmental, Social and Governance Advisory Practice. Since then, as Law360 reports, other law firms have adopted that model.

HERE BUSINESS IS

It’s uncertainty which is among the major challenges for business in 2022. To inflation, surging labor costs, inability to raise prices enough to absorb expenses, stock price, and geopolitical tensions have been added ESG issues.

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com. Now and then she does freelance assignments for professional services firms such as Paul Weiss.

Want to Push Back on Abortion Limits? - Buy Some Stock

Supporters of gutting "Roe v Wade" have a peculiar enemy.

That's the SEC. Recently, reported Bloomberg Law, it had made a policy shift. Essentially that will allow more retail and activist investors to place proposals about climate and social matters in the form of a proxy. During 2022, it had turned down 30% of corporations' requests to put the kibosh on those. That means there are fewer approvals of the corporations' requests for "no-action letters." The situation has unraveled so dramatically and quickly that some corporations have thrown in the towel for asking for them.

During this proxy season those shareholder proposals about defending abortion rights will speak up loud and clear to public companies about what is perceived to be the right thing to do on this issue. Bloomberg Law notes:

"Walmart Inc., Lowe’s Cos., and TJX Cos. represent what’s potentially the tip of a burgeoning trend in shareholder activism in this area [abortion rights]: All three companies will face votes on proxy proposals in the coming weeks aimed at shaping internal policies related to abortion access."

Corporations are bound to be all-ears. Name one which doesn't fear being the "Next Disney" in the current turmoil about ESG (Environmental Social Governance) values.  The job of the CEO can soon be in play. Already at Starbucks and Coca-Cola the chief legal officer is gone. 

Esentially those against limiting access to abortion should do this: Buy some stock. That puts them in a position as a shareholder to mobilize other shareholders to "do the right thing." Of course, they can reinforce that initiative with other actions. Those can range from lawsuits to boycotts.

Connect with Editor-in-Chief Jane Genova at janegenova374@gmail.com

SCOTUS Leak - Hosting WhoDunIt Mystery Night at Posh Restaurants

Upscale restaurants frequented by lawyers and those in the loop about law can have a lucrative special event. At least as long as the identity of the SCOTUS leaker remains a mystery. And that might be on short term since speculation favors a clerk or clerks as the miscreant. Here is the Bloomberg Law coverage of that. In addition, one wonders if Chief Justice John Roberts will cave. He could parachute in an elite law firm to do one of those investigations they conduct at media corporations experiencing alleged rogue behavior. 

The format would involve buying a ticket (at great cost) to showcase a hypothetical of how the leak had been done and who might have the most motivation. No names mentioned since that could result in a defamation lawsuit.

Then the audience would vote on who had connected the dots in the most entertaining (but not necessarily the most probable) way. Given so much gravitas since COVID, this should be fun. The prize would be four free dinners and drinks for a party of two. That tab can be pricey in those kinds of restaurants. 

Meanwhile, the baffling issue remains: Why would anyone who is part of SCOTUS risk everything to leak a document? Was that out of a 2022 version of "A Profile in Courage?" A resentment? Or the usual self-destructive behavior of those who maybe gave up too much to get where they are?

Connect with the Editor-in-Chief Jane Genova at janegenova374@gmail.com.

Partnerships: That's How Paul Weiss' ESG and Law Institute Keeps Expanding Its Reach to Business, Government, and Law

There has been plenty of ESG-generated disruption throughout the corporate world. So much so that the preoccupation has become not becoming the “Next Disney.” Those kinds of actions have been increasingly pervasive and intense. Now even the boundaries between law firms and their clients have collapsed. Mayer Brown, for example, had been caught up in global vilification and a threatened boycott when representing Hong Kong University about the symbolism of Tiananmen Square.

MACRO THINKING ABOUT ESG

That’s the action part. However, overall the macro piece had been missing. That is, the analysis, research, and education about ESG. In particular, what has to be explored – 30,000 feet up – is its intersection with business, government, and law itself.

Wall Street law firm Paul Weiss noticed that. And what it created has been the ESG and Law Institute.

Think of The Institute as a kind of centralized intelligence network for boards, executives, institutional investors, lawyers, and law schools. Its Executive Director is David Curran. Paul Weiss provides direct ESG legal services to clients through its Sustainability and ESG Advisory Practice, founded by its Chairperson Brad Karp.

THE MAGIC OF PARTNERSHIP

The Institute is rapidly expanding its reach through partnerships. One point of leverage have been law schools such as the University of California at Berkeley and Howard University.

Most recently the Institute has joined with the FiscalNote Executive Institute.

Together they are co-hosting a three-course official continuing education series (providing up to 3 CLE credits). The schedule is: May 5, July 14, and September 22. Here are the details and the registration form.  

THE NUTS AND BOLTS

In the first session Curran and Kate O’Leary, General Electric’s Global Executive Litigation Counsel, will explore these kinds of issues:

How does ESG impact business, government, external affairs, and law?

What do senior executives and in-house counsel have to consider, especially given global and US regulatory developments. Yes, to be analyzed will be the SEC’s proposed climate regulation.

What are the ethical and legal considerations for corporations that embrace or do not embrace ESG?

The second session will focus on “Overcoming Resistance to Innovation Within the Legal Department.” The third session will deal with “Ethical Use of AI and the Emerging Legal Landscape.”

SUSTAINABLE INVESTING

The ESG and Law Institute is a resource for Wall Street, Wall Street law firms, and law students heading to Wall Street. Global Sustainable or ESG investing, projects Bloomberg Intelligence, is on track to reach $53 trillion by 2025. It is becoming standard for financial firms to have a Chief Sustainability Officer.

Connect with Law and More’s editor-in-chief Jane Genova at janegenova374@gmail.com. Now and then she does freelance assignments for professional services firms such as Paul Weiss.