A few weeks ago, the Association of Corporate Counsel’s 2021 Chief Legal Officer Survey hit the digital presses, drawing on responses from participants in over 20 industries and more than 40 countries. The 62-page report was sponsored by Exterro, and is packed with valuable and insightful input from over 900 CLOs and GCs on topics ranging from reporting lines and staffing levels to the regulatory landscape and looming challenges.
Broadly speaking, it is clear Legal’s influence throughout the business continues to increase. This is evidenced by 30% of responding Legal departments’ intent to to hire more lawyers in 2021, over half of respondents have a reporting line to the board of directors, and 70% of in-house attorneys finding themselves being counseled by executives when it comes making business decisions. These statistics are indicative of growing challenges faced by Legal departments today.
As Exterro CEO Bobby Balachandran said, “The 2021 CLO Survey confirms what we see every day in the organizations with whom we work—that converging market forces in legal operations, privacy, compliance and cybersecurity response are driving an evolution of the role of the CLO.”
When looking at the results holistically, it becomes clear that companies with less annual revenue than their peers have a clear path toward more efficient processes, savings, and decreased corporate risk. Here are some questions legal leaders can ask themselves.
How many legal operations professionals are in your department?
Legal project management was left out of process optimization until relatively recently. However, that tide continues to turn as this year’s ACC CLO Report found that 80% of all participating respondents representing organizations with $3B or more in annual revenue employ at least one legal operations professional.
On the other hand, just 51% of organizations with under $100M in annual revenue reported having a role dedicated to legal operations. That means that a sizable portion of companies still stand to benefit from investing in building out a legal operations role and taking a hard look at existing legal project management processes. With a growing impetus for Legal to eke out savings, departments of all sizes can find tangible savings in bringing more processes in-house, while also decreasing risk by reducing sharing of sensitive data.
What growing issues are on your mind?
Fourteen issues were presented to CLO participants, and they were asked to rank their importance on a scale of one (very low importance) to 10 (very high importance). The three areas Legal leaders are most concerned about are Cybersecurity, Regulation/ Compliance, and Data Privacy. These rankings comport with recent increases in high profile cyber-attacks, greater scrutiny from governmental bodies regarding handling of data like PII, and growing consumer rights such as the strengthening of CCPA with the passage of CPRA.
That these three areas are all simultaneously top of mind for CLOs indicate a demand for higher levels of preparedness for incident response, agility in the face of growing regulatory requirements, and the ability to coordinate minimization of data risk across the organization.
Do you have a comprehensive data management strategy?
The ACC CLO report found that 65% of companies with $3B+ annual revenue have implemented a comprehensive data management strategy, whereas just 58% of organizations under $100M in annual revenue have one. As those organizations with smaller legal departments continue to grow—and regulations in parallel—the importance of taking a holistic approach to data management becomes imperative.
Leveraging a data management strategy that spans geographies and departments can mean massive cost savings in the short and long term. With the proliferation of collaboration applications, data continues to grow, and with the passage of CPRA, following a data retention schedule will soon no longer be a best practice, but will rather a requirement. Savings in destruction of redundant, obsolete, and trivial data can be realized nearly immediately.