General Counsel File: Brad Smith, Microsoft Corporation

A profile of Brad Smith, Senior Vice President and General Counsel of Microsoft Corporation.

Practical Law The Journal

Education: 1985: J.D., Columbia University School of Law. 1981: A.B., Princeton University.

Brief career to date: 1993 to present: Microsoft (General Counsel since 2002; Deputy General Counsel 1996−2002; Associate General Counsel 1993−1996). 1986 to 1993: Covington & Burling LLP. 1985 to 1986: Clerk for Honorable Charles M. Metzner, Southern District of New York.

Location of company headquarters: Redmond, Washington.

Primary industry sector: Information Technology.

Number of employees worldwide: 92,736 (as of end of FY2009, June 30).

Revenues in the last financial year: $58.44 billion (as of end of FY2009, June 30).

Number of lawyers in the company worldwide: 459 in 44 countries.

Law department locations: Redmond, Washington.

How is the legal function structured? Microsoft's Legal and Corporate Affairs organization oversees all global legal work, government relations and community affairs for the company. There are Deputy General Counsels who lead legal groups that support specific vertical business groups, such as Windows, Online Services and Server and Tools, and others who support cross-company legal priorities, such as Intellectual Property and Licensing, Litigation, and Corporate and Regulatory Affairs.

Who has overall responsibility within the company for business ethics and corporate governance? Business ethics and corporate governance are both managed by the Legal and Corporate Affairs organization. As well as being General Counsel, I serve as Microsoft's Corporate Secretary and Chief Compliance Officer.

Which areas of legal risk do you predominantly encounter in your sector? Intellectual property risk is a central focus. We also prioritize antitrust and securities law issues and we pay close attention to the FCPA issues that every US-based global company must address.

What is the most important way in which law firms can maximize value for in-house counsel? Our law firm partners can help us identify new and creative opportunities to deliver more value to our clients. If our law firms understand our clients' goals, they can help us think of new ways to enable us to meet their goals. So there is real upside on the value part of the equation. At the same time we look for opportunities to reduce the costs incurred in delivering the value we're already delivering to our clients. A lot of that comes from new steps that we can take along with our firms to increase productivity and enhance efficiency.

What is the single most challenging issue that in-house lawyers are likely to face over the next two to three years? Not surprisingly, it is adjusting to what may emerge as the 'new normal' in the global economy. The economy has not yet re-stabilized and a lot of uncertainty remains. As a result, companies are going to look to in-house lawyers not only to do new things in new ways, but also to do things in more productive ways than they have in the past. In-house lawyers will have to grapple with delivering value at a lower cost.

What type of actions would be most likely to induce you to dismiss an external law firm? We have on occasion dismissed law firms when we have lost confidence in their ethical conduct. A breach of ethics and a breach of confidence really amount to a breach of trust and make it impossible to continue to work with a firm. There are three other reasons that can lead us to dismiss a firm. One is seeing them fall short in terms of quality and the results we are seeking. A second is seeing them fail to adjust to the economic climate and work with us to ensure that fees are reasonable. And the third is to fail to make progress on diversity. All three of these have been factors in decisions we have made both with respect to firms we will use and firms we will not use on various matters.

If not a lawyer, what would you be? I very much like what I am doing now. I was intrigued growing up by the possibility of pursuing a diplomatic career. Ultimately I obviously chose not to, but that would certainly be very interesting.

What is the most rewarding aspect of your role as General Counsel? I think it is the opportunity to work with so many different people on so many interesting issues. The job is well suited to people who like people and people who have a broad range of subjects in which they are interested. Those tend to be common features of General Counsel positions.

What is the one piece of advice you would pass on to any prospective General Counsel? I would actually offer two pieces of advice. One is to look at the big picture. Lawyers are trained to focus on details, and by definition lawyers do not succeed — including rising to become General Counsel — without the ability to focus on details. One does not want to lose that, but it is critically important to recognize that there is no lawyer at the company who is going to have a better sense of the big picture than the General Counsel herself or himself. You cannot delegate to someone else the job of trying to define the big picture for the company as a whole around major issues. Second, you need to couple that with the ability to be quick when it comes to details. Looking at the big picture includes sometimes having to dive into the deep end of the pool quickly, figure out what the issues are, move them forward, and then dive into the next pool where there is likely to be another significant issue waiting for you.

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