DuPont’s Legal Lead

Growing up in Warwick, Rhode Island, Thomas L. Sager had no reason to enter the legal profession, but, 40 years later, he couldn’t be more ingrained in it. “I thought it would be a noble profession, one in which I could hopefully give back at some point to the community,” says Sager, who leads a team of 600 employees, including 210 lawyers, as general counsel for E. I. du Pont de Nemours and Company, aka DuPont, which is currently ranked 72 on the Fortune 500 list.

By 1976, when Sager graduated from Wake Forest University School of Law in Winston-Salem, North Carolina, he was “singularly focused” on labor and employment law. “It offered a combination of substantive law and advocacy, defending companies from complaints lodged with the National Labor Relations Board, handling private arbitrations between companies and unions, and litigating,” Sager says. “Every day is like a new day in terms of what you deal with.”

Unlike most of his peers, Sager didn’t pursue the traditional career path, working for a law firm before pursuing a role as inside counsel. The year he graduated, DuPont had decided to move away from lateral hires and recruit directly from law schools. “The company wanted to infuse the department with youth and, hopefully, talent, and it wanted to diversify the legal department,” says Sager, who’s been with DuPont ever since. Today, he serves as the company’s senior vice president and general counsel.

Sager, whose father was also a long-time DuPont employee, says he was initially attracted to the opportunity to specialize in labor and employment law, but soon gained a passion for the company’s mission. “DuPont is a science company, and from that flows a number of contributions to society, from Kevlar vests to Tyvek house wrap to Nomex fire-retardant materials to Pioneer seeds,” Sager says. “We’ve been making a difference for 210 years.”

Sager himself has played a significant role in the company’s success, by spearheading a dramatic change project back in 1992. At the time, DuPont CEO Edgar Woolard Jr. had asked staff to cut costs by $1 billion, and Sager knew that would involve reengineering the way the firm worked with outside counsel. “Simply asking them for rate reduction wouldn’t be sustainable,” he says.

In response to Woolard’s request, Sager headed a convergence team that reduced the number of outside law firms DuPont worked with from 350 to 39, and the number of suppliers from 150 to 10. He then wrote the first several editions of the DuPont legal model, which offers DuPont’s corporate law departments and the law firms that serve them a wide range of best practices. “It’s essentially a playbook that shows lawyers how to apply business practices to the field of law in order to drive efficiency, reduce costs, and bring value to the client,” says Sager of what he calls “a tremendous collaborative effort.”

Sager has also been instrumental in fostering diversity at DuPont to the extent that he is now known for these efforts throughout the legal profession. The prestigious Sager Award, given by the Minority Corporate Counsel Association to law firms that have demonstrated sustained commitment to improve the hiring, retention, and promotion of minority attorneys, is named after Sager himself. “Our ability to attract quality employees has increased because people know we’re a company that has good core values, such as a commitment to diversity,” he says.

Although DuPont’s legal model and diversity efforts now guide companies industry wide, Sager’s job is not without challenges, most of them stemming from the company’s expansive reach and diverse product line. “We have 13 global businesses that offer radically different products, and we’re continuing to expand,” Sager says. “Growing market share without creating undue risk for the company is the biggest challenge we face.”

Despite attempts to avoid risk, says Sager, every year DuPont faces six or seven significant challenges in the form of antitrust, intellectual property, or mass tort lawsuits. “Frequently, we are challenged as to whether or not a significant case should be litigated or not. Many considerations come into play, such as the company’s reputation, distraction to the business, deterrence to future litigation, and, of course, the cost of defense to name a few,” he says. “It is rarely a straightforward and easy decision to make when you are spending the company’s money by settling. Those are the times that I will second-guess myself, particularly when I think the plaintiff’s case is weak and without merit.”

Sager has faced such challenges with aplomb, in part because he’s made it his mission to learn. “You want to be externally focused, because you want to understand the legal trends that may affect the company, and you want to learn from the experience of others,” Sager says. And it’s a lesson that Sager applies to himself at DuPont. “You want to feel discomfort by pushing yourself professionally,” he says.

One way Sager has done this is through DuPont’s recovery effort, which started in 2004. “Our department was tired of being seen as a cost center, so we hired Deloitte to look at what money we were bringing in versus what money we were paying out in settlements,” he says. “It varied year over year, and we realized that if we put more discipline into the process, we could make the legal department a profit center.”

Since then, Sager’s department has generated more than $2.6 billion in revenue, and Sager was recently asked to speak to the G100—which consists of CEOs from the world’s largest and most successful companies—about how they can do the same. After all, he says, “The legal department isn’t just there to cut checks.”