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Compliance duties, litigation prevention increasingly seen as top priorities
Recent research from Thomson Reuters gives an interesting snapshot into how the strategic focus of corporate law departments has shifted in the space of a few short years.
Jerome Doraisamy
Thomson Reuters recently released its 2023 State of the Corporate Law Department report, which surveyed 1,569 corporate legal professionals globally throughout 2022. Respondents hailed from the US, Asia-Pacific region, Continental Europe, the UK, Canada, Latin America, the Middle East and Africa.
Shifting priorities
The report also found that, since 2019, there has been a realignment in how in-house legal teams triage and prioritise their responsibilities in terms of importance.
Back in 2019, day-to-day advice, proactive risk management/litigation prevention and cost control (all 17 per cent) were seen as the most important areas for strategic focus, followed by improving efficiency and streamlining processes (16 per cent) and compliance/regulatory requirements (15 per cent).
In 2022, however, compliance and regulatory requirements had shot to the top of the list, at 22 per cent.
This was closely followed by proactive risk management/litigation prevention (21 per cent) and cost control (19 per cent) — perhaps indicative of an increasingly litigious climate post-pandemic, as well as inflationary and recessionary pressures in the broader market.
Moreover, as Thomson Reuters wrote, “the cost of litigation has risen substantially due to factors such as the increased complexity and cost of litigation necessities, such as e-discovery and the quickly escalated rates charged by outside counsel”.
Providing more commercially impactful advice (18 per cent) and improving efficiency and streamlining processes (12 per cent) rounded out the top five areas for strategic focus for 2022.
But while the provision of commercially attuned legal advice and operating in more efficient ways fell down the priority list in the years between 2019 and 2022, Thomson Reuters stressed, those priorities “should not be thought of as less important” for corporate legal.
Indeed, it wrote, advice remains a top priority for law departments in some pockets of the globe, such as in Canada.
The ranking of efficiency as a priority, it mused, “may well be a function of bandwidth more than anything”.
This being said, operating efficiently remains a “vital component” in the context of the aforementioned other priorities, including the controlling of costs, “so it may not rank as highly because it is, in a sense, being subsumed within other stated priorities”.
“In another sense, efficiency may be crowded out in the competition for top-of-mind awareness when compared to more pressing priorities, such as managing risk due to shifting regulations,” Thomson Reuters wrote.
To read Thomson Reuters’ 2023 State of the Corporate Law Department, click here.
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly. A former lawyer, he has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. He is also the host of all five shows under The Lawyers Weekly Podcast Network, and has overseen the brand's audio medium growth from 4,000 downloads per month to over 60,000 downloads per month, making The Lawyers Weekly Show the most popular industry-specific podcast in Australia. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of Minds Count.
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