New Year, New Job: A Legal Chief’s Guide to Landing a New Gig

The start of a new year is a popular time for companies to add to their executive ranks, particularly when it comes to legal leadership roles.

Public and private entities closing out or starting a new fiscal year may be in the market for a new top in-house lawyer, whether it’s a newly created role or to backfill a departure or retirement. And if you’re in the market for such a job, it helps to know what you’re looking for, said John Nixon, an executive compensation and employee benefits partner at Duane Morris LLP.

Nixon frequently counsels CEOs and CFOs in negotiating their employment agreements, but when it comes to key legal positions—be it chief legal and compliance officers or general counsel—he’s more often guiding behind the scenes. “They want to show their bones in terms of negotiation, and that’s usually the first negotiation they’re doing with the company,” Nixon said.

“There are so many moving pieces I’ve seen that a typical GC may not have seen,” he said.

John Nixon

Courtesy of Duane Morris LLP

Nixon trained as a tax lawyer. He now has nearly four decades of expertise. And while his outside counsel role is rarely noted in securities filings—such as when JetBlue Airways Corp. disclosed over the summer a separation agreement with its now former general counsel—current and would-be legal chiefs know who to call for advice on their way in, or out, of corporate boardrooms.

Helpful Tips

Nixon, a member of the governing partners board at Duane Morris, listed a handful of items he tells clients to keep in mind when choosing a C-suite job.

Culture: Know the company you’re negotiating with, as expectations vary among industries. Big banks are different than Big Tech, just as private equity firms and funds are unique within financial services. Who had the job, if anyone, before it was offered to you and how long were they there? If you don’t fit, you won’t get the job, and you likely won’t last if you do. Culture affects compensation.

Compensation: Executive recruitment firms tend to self-select for the best fits, so most job candidates at least have a range or ballpark figure of what they’re able to negotiate. Relocation and signing bonuses, retention kickers, and cash-versus-equity or -stock is something a CEO and board will determine. Candidates need to do a lot of self-examination to figure out what model works best for them. Not everyone needs cash, although most folks need some component of it to accommodate their lifestyles. Some individuals are interested in a position to broaden their resume and portfolio. What are your priorities?

Career: If you’re a lawyer who has worked solely at startups or privately held outfits, maybe you’re willing to take less compensation for a job that gives you public company experience. Or maybe you’re lucky enough to have cashed out of a prior job and eager for a new opportunity that provides some kind of non-financial reward. Alternatively, perhaps there could be a liquidation event on the horizon—either via a sale of a company or taking one public—that could provide a significant financial reward down the road for those that take less up front.

Research: If it’s a public company, read its most recent proxy statements. Is the job you’re applying for one that appeared on its summary compensation table? Who are the company’s peers? Those are also likely listed in the proxy. Since executive compensation can be benchmarked to a company’s competitors, such information can be useful in a negotiation with your prospective employer.

Risk: What’s your appetite for it? There’s risk in any job switch, and crystal balls can be cloudy, but if you’re willing to take a chance the rewards could be immense. You might become the legal chief who eventually gets promoted to CEO, putting your career and pay on a different trajectory.

Nixon said when he’s negotiating compensation for legal chief clients, he looks for “vertical parity” in benchmarking pay—usually to a CFO, if a company’s former top lawyer isn’t listed in the proxy. He’ll then tack to “horizontal parity,” which is seeing what legal chiefs earn at peer companies, to leverage a higher number and get his client the best deal. Nixon targets terms—such as compensation, severance, and contract length—not titles.

“Some people come to the table and say, ‘I want to be chief legal officer,’” Nixon said. “I think they’re worried about what will happen if there’s a reorganization where someone comes in above the general counsel.”

On the Firing Line

Focusing on terms is the best way to not worry about titles, he said. Corporate legal chiefs, unlike other C-suite professionals, often must deliver bad news to a CEO or board without having a positive profit and loss statement behind them. That puts them directly in the firing line, which necessitates having built-in job protections to make it painful for a company to terminate you, Nixon said.

“If they have to pay two years of severance, they’re more inclined to work through any difficulties,” Nixon said.

Nixon also likes to negotiate carve-outs for legal chiefs to serve on corporate boards. Not every company allows it, but such service sharpens the skillset of his clients, Nixon said. And if you want him at your side, it’s best for lawyers and non-lawyers to retain Nixon early when negotiating an employment agreement.

“As long as they can pay the hourly rate, they’re all welcome,” he joked.