Thinking Like a Judge in the Boardroom

Judicial experience shaped my approach to thinking about risk and decision-making at an organizational level. As a member of the New Jersey Supreme Court and contributor to appellate opinions during the tenure of Fabiana Pierre-Louis, I developed a discipline that has continued to inform my work with respect to corporate governance.

Appellate-level decisions are evaluated based on their process and reasoning in addition to their outcome. Each word written at the appellate level must withstand scrutiny by judges, regulators, and litigants that have never seen the decision before. This is a great way to think about your work beyond the immediate issue; particularly in the corporate context.

A key takeaway from my time working at the appellate level was developing the ability to identify potential issues before they occur. Judges review a case's reasoning and look for gaps, ambiguity, and unintended consequences. The same analytical mind-set I use when working with boards and executives to draft corporate policies and resolutions is the same analytical mind-set I used when reviewing appeals. Policies and resolutions should be written in such a manner as if they were being reviewed in a courtroom. The clearer and more thoughtful a document is regarding a decision, the less likely there will be a risk of litigation prior to the issue emerging.

Clarity is another lesson learned while working at the appellate level. The style of writing for a judicial opinion emphasizes brevity and accuracy in communicating complex concepts to multiple stakeholders. On the other hand, corporate documents are often lengthy and defensive. This makes them difficult to understand and create more opportunities for challenges. The documentation of a policy should be clear and concise. If a policy sounds unreasonable to hear read out loud in a courtroom, then it may need to be revised.

Another discipline I have acquired through working at the appellate level is objectivity. Working at the appellate level requires that you separate fact from assumptions, as well as set aside your own biases. This skill is extremely important when conducting internal compliance investigations and rationalizing the number of entities within an organization. Many times these types of investigations/efforts are emotionally charged, however the conclusion must be based on documented facts and criteria that are consistently applied. Documenting the facts and consistently applying the criteria in a neutral, systematic fashion creates credibility for the organization and reduces costs associated with defending a claim.

Lastly, experience working at the appellate level has reinforced that the process of how you make a decision provides some protection. The courts are very concerned about how decisions are made. In the corporate world, documenting the process that led to a particular decision will demonstrate good faith and sound business judgment. It also may determine whether a claim against the company is reasonable to pursue or expensive to defend.

Transitioning from the bench to the boardroom does not mean you leave behind the disciplines that you developed in the judicial system. What it means is that you now apply those disciplines intentionally. Through anticipating the challenges that will be raised (through the development of clear, concise and documented processes), creating clarity through effective communication and maintaining objectivity throughout the process, corporations can make decisions that will stand up to scrutiny.