Does your attorney need to understand your business? And if your business lawyer does not have a strong grasp of your business, does it matter? Yes, the answers matter for entrepreneurs.
Some lawyers will say that they do not need to have a deep understanding of your company. They might say it is not their role to advise on business issues, and thus they do not need to concern themselves with the particulars of your business model. This belief is one reason for the gap between how lawyers and clients view business situations.
Yet, a lawyer who does not know the fundamentals of your business will be hard pressed to give advice that squares with YOUR goals. Let’s be clear about this. Learning the fundamentals of a business is not easy. Directors at Lehman Brothers and Merrill Lynch did not understand those companies’ businesses. Legally, directors are held to a higher standard than lawyers about knowing the corporation’s business. And directors can be held liable for failing to sufficiently inform themselves about the corporation’s decisions.
However, lawyers can add value to clients if they understand the client’s business. The question is how can lawyers obtain this understanding.
For lawyers, Legally Informed Strategy provides one approach to the problem. Legally Informed Strategy uses a combined Strategy, Law, and Organization lens to tackle difficult problems that your startup faces. The approach explicitly recognizes that many business and legal decisions are inherently connected, and that such decisions require particularized business knowledge. Legally Informed Strategy advances business objectives through integrated business and legal insights.
Conclusion
Sure, your lawyer can be a technician or a transaction cost engineer who minimizes the legal risks associated with deals and legal decisions. However, an attorney who clearly understands your business can more effectively help you achieve your goals.
Douglas Y. Park
Twitter: @DougYPark
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