Leading up to DLA Piper's Global Women's Leadership Summit on October 16 – 17, 2018, Caroline Krass, Senior Vice President and General Counsel, General Insurance, and Deputy General Counsel at AIG, spoke about the importance of innovation in today's business environment, the role of the GC in facilitating innovation while simultaneously managing risk, and her experiences working in government before joining the private sector.
Krass will be one of several speakers on a panel called "Cybersecurity: Opportunities and Risks with New Technology," on October 17 at 3:45 p.m.
1. Why is it important for companies to keep innovating in the current business environment, whether it's exploring new ventures within existing business units or developing new business models?
It is critical that companies continue to innovate to avoid becoming obsolete. The speed at which innovation and technology is advancing in this digital landscape is unprecedented. Companies are operating in an interconnected global environment driven by the introduction of artificial intelligence, the Internet of Things, blockchain, autonomous vehicles and big data. Companies are feeling intense pressure to adapt existing business models and/or to develop new ones to leverage emerging technologies to lower costs and improve customer service.
AIG has always been an innovative company. We were the first to offer cyber-risk insurance in the market almost two decades ago. Last year, we launched a new cyber underwriting model that quantifies and scores an organization's cyber-risk using a tool called CyberMatics. This tool allows us to provide valuable feedback to clients regarding their threat profile and how the implementation of specific controls may improve their cybersecurity posture.
2. What role do you think GCs play (or should play) in facilitating innovation within their companies, while still managing risk to protect the core business?
General counsel play a critical role in facilitating innovation. We need to think creatively and proactively, while simultaneously ensuring that initiatives are conducted in a lawful manner with an eye toward both foreseeable and unforeseeable risks. We have to stretch ourselves to truly look around the corner and make sure that protections are in place for unexpected consequences and that appropriate governance accompanies day-to-day decision making.
3. You're in a unique position of having experience as a GC, in private practice, serving on several boards and working in government offices. How do you draw on the impressive skills and experiences you've acquired throughout your career in your current role?
Before joining AIG six months ago, I led the National Security practice at a major US global law firm where much of our advice focused on cybersecurity. I advised boards of directors of Fortune 500 companies on the steps necessary to avoid liability in this area. I drew on years of experience with cybersecurity and privacy from my time as General Counsel of the CIA, as President Obama's Special Counsel for National Security Affairs, and as Acting Assistant Attorney General at the Justice Department. In my current role at AIG as General Counsel of the General Insurance business, I rely on many of the skills I developed in government, including judgment, asking tough questions, approaching issues objectively and developing strong relationships with my colleagues.
4. How do you prefer to work with outside counsel and at what point do you generally choose to engage?
AIG has an extremely strong internal legal team embedded with our business partners who understand the distinct risks specific to our business. I generally choose to engage outside counsel when we do not have the resources to solve an issue ourselves and it would be cost-effective to bring in an external party, particularly if the question is outside the range of issues we normally address. It is important to make sure we are not spending too much time bringing our outside counsel up to speed on an issue, and thus I focus on outside counsel with relevant (and often specialized) expertise or whom I know to be quick learners with excellent judgment. Given the myriad of global jurisdictions in which we operate, we also use local counsel familiar with those foreign jurisdictions when needed.