For the General Electric Company, 2019 was an extremely challenging year. GE experienced a downturn in its renewable energy profit margins, GE Aviation had to deal with the grounding of the Boeing 737 MAX fleet, and the company ran into difficulties with its overall financial health. But late in 2019, the signs of CEO Larry Culp’s efforts to right the ship became more apparent. GE Power continues to show improved numbers, and despite the Boeing fleet worries, GE Aviation’s numbers remain strong. The year 2020 has been forecasted as a potentially strong year for GE, and after an extensive period of transition, CEO turnover, and potential setbacks, the shifting of the tide is right on time.
Global Executive Counsel Roland Schroeder has been with GE since 2005, and in that time, he has been a part of the extensive evolution of the corporate litigation team. As GE has diversified and grown, it’s created unique challenges for the litigation team, requiring considerable adaption to meet the new needs of the company in the twenty-first century.
Schroeder’s purview is wide. His corporate counsel role means sitting atop the larger law organization and handling securities, presorting, FCC filings, firm relationships, logistics, risk and reputation, legacy matters, M&A, and the other million or so issues that can instantly become legal problems.
Increased legal need didn’t necessarily mean the growth of the legal function. In fact, Schroeder says his team is leaner than when he started, requiring more individual efficiency and responsibility. But for the global executive counsel, it’s simply provided a chance to embrace the wide diversity of working at a company like GE whose breadth of interests range from 30,000 feet up in the air to far below the earth’s surface.
Since Schroeder came to GE, the company has essentially flipped its revenue. Initially a 60/40 split favoring stateside-based revenue to the rest of the globe, GE has now shifted so that a majority of revenue is generated from outside the US. For the legal team, that has meant an extensive increase in litigation for international arbitration. Despite this increased volume, Schroeder says the team has managed to successfully drive greater speed and efficiency even as the needs have increased. The litigation’s goal is clear: create a new vision that takes into account the significant number of divestures and aid in GE’s operating at the top of its game.
At GE, each business segment has its own legal team, requiring effective communication and collaboration to balance the individual business needs with the overall vision of the larger legal organization. Schroeder says the legal team is particularly collaborative at GE due to the different legal practices and disparate businesses of such a diverse company.
The extensive legal needs of a company as large as GE requires adept and agile outside counsel. GE chooses to either renew or engage new representation with outside counsel every four years for each practice area. The process includes negotiating rate structures and oftentimes alternative fee arrangements.
As GE pushes forward in 2020, it’s clear that the legal operation behind the company’s most pressing business continues to evolve to meet the needs of a company whose slogan may as well be, “We make everything.”
Weil, Gotshal & Manges LLP:
“Roland Schroeder is an outstanding strategic thinker, leader, and in-house partner.”
–Diane Sullivan, Partner