September 20, 2018

Cybersecurity, Regulations Stretching Legal Departments, According to Thomson Reuters Survey

In-house leaders balance growing demands by shifting work, relying on technology, hiring operations managers        

MINNEAPOLIS-ST. PAUL, September 20, 2018
– Legal departments are maximizing plateauing headcount and driving efficiencies, even while demands on their time increase, according to the 2018 Thomson Reuters Corporate Legal Department Efficiency Report: Doing More With Less and Increasing Productivity in Corporate Legal Settings. The 2018 report — the third in a series of Thomson Reuters efficiency reports — surveyed 462 attorneys and decision makers working in corporate legal departments nationwide to identify trends in managing resources and adapting to business needs.

“One trend continuing to shape legal departments through each survey is how general counsel are increasingly expected to serve as business advisers in addition to providing legal advice,” explained Chris Maguire, managing director of the U.S. Corporate segment, Thomson Reuters Legal. “General counsel are becoming more involved across their organizations, particularly in terms of advising the board of directors and business leadership.”

The report findings stressed how corporate legal departments, already stretched by limited resources, are confronting new, as well as traditional, challenges. Respondents noted that data security and ethics and compliance remain key priorities, but cybersecurity ranked higher in importance to legal departments in 2018. Among the factors heightening this concern was the May 2018 deadline to comply with the European Union’s General Data Protection Regulation (GDPR), which imposed new rules for how companies manage the personal data of those in the EU and significant fines for noncompliance.

Respondents also indicated they are spending more time handling regulatory matters relative to a year earlier. Beyond the new EU requirement, another driver of the increase was the new executive administration and Congress in the U.S., which drove additional changes in government regulations — especially in areas including employment, data privacy and immigration.

The report highlighted the measures legal departments are implementing in order to operate more efficiently.

“While most operational activities are still handled by general counsel and attorneys, GCs are increasingly relying on legal department operations managers to find creative ways to use resources, as well as track spending and time,” said Maguire. “This gets to the heart of the rationale for a more efficient in-house team: the ability to focus on strategic work.”

According to 41 percent of respondents, the top benefit of being more efficient is the ability to focus on strategic work.

“More time for strategic work and less time focused on administrative work also involves more thoughtful use of outside counsel,” added Maguire. “In-house teams continue to consider different ways of partnering with outside counsel as a key component of improving productivity.”

The report found that beyond evaluating how they engage outside counsel, legal departments are improving productivity by deploying new technologies, including billing software, and by shifting work from lawyers to paralegals and other staff, among other measures.

The report findings demonstrated how the growing demands on legal departments are making it increasingly difficult for in-house leaders to avoid the pitfalls of inefficiencies, such as budget stress, staffing woes and dependence on outside counsel.

Download and read the full survey report here.

Thomson Reuters

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Jeff McCoy