We are at a transformative moment. While caution remains the word and lesson of choice, it is increasingly clear that, as we move out of the first quarter of 2021, the business landscape is primed for an explosion of growth. According to data from Oxford Economics, over the next 10 months, global GDP is expected to enter a period of hypergrowth – upwards of 10% – to be follow by a period of elevated growth for the next two to three years. While the expected growth will likely present challenges for already strained businesses, it must also be seen from the wider context of how, or whether, businesses bring talent back to their offices, how they retool supply chains and how they rethink how work of all types gets done. At the same time, many businesses are considering how to address the long-term challenges associated with the growing global emphasis on sustainability and social justice in many areas including regulation, corporate governance, supply chain management, recruitment and corporate citizenship. How companies and their leaders navigate this transformative moment is of critical importance. Their ability to do so will depend in no small measure on whether the legal department and other related functions are able to deliver data driven, cost-effective services that identify and mitigate risk while driving productivity and growth.
To understand these challenges and changes, in early 2021, EY Law and the Harvard Law School Center on the Legal Profession worked together on a major research project, interviewing 2,000 business leaders across 22 countries. The extensive survey focused on law department operations (including talent, data, technology, and sourcing), contract creation and management and corporate secretarial operations supporting legal entity compliance and governance. The result is an extensive and current dataset that captures the operation and transformation of law departments from the perspectives of both General Counsel and other business leaders.
As the survey data underscores, law departments will be under significant pressure from the top to align with wider business priorities and to think and act differently. While controlling costs is important, maximizing the legal function’s value to the organization will be a key differentiator, particularly with respect to assessing and managing the myriad of increased risks that businesses are likely to face in this new environment. Developing and effectively deploying data driven metrics of quality and cost will therefore be key. All of this must be done while rethinking the nature of work and talent. Understanding how law departments approach risk management, adjust to these new realities, and protect their companies from future hazards will therefore be critical. The extensive dataset and the findings presented in this report offer a relevant way of examining the operation and transformation of law departments in a changing world. We look forward to engaging with you on these important issues in the weeks and months ahead.
(From “General Counsel Imperative Series: How do you turn barriers into building blocks?“)
Want to get involved in our work? Check out our opportunities.