General counsel influence is rising, new research finds
Businesses recognise the importance of in-house advice, says Law Society chief executive
Over two-thirds of general counsels (GC) now sit on their organisation's board with more than half reporting to the CEO, new research has found.
The Law Society's 2015 GC350 study, sponsored by LexisNexis, showed the growing pressures in-house legal departments are under as GCs adapt to changing market conditions.
The research found that half of GCs now set legal budgets and two-thirds determine how such budgets are spent.
On average, 58 per cent of a GC's budget is spent on external legal advice. Meanwhile, almost half of specialist advice, and a quarter of high-level strategic work, are outsourced.
However, the need to reduce costs is driving GCs to grow their in-house capacity.
The Law Society's chief executive, Catherine Dixon, said the findings suggest that in-house legal teams are growing in their influence and credibility.
'Organisations are recognising the importance of the role that general counsel plays,' she said. 'Demands on in-house legal functions are increasing due to the need to address higher volumes of work with reduced resources and increasingly complex legal and business regulation.'
She continued: 'In this climate, innovative approaches are being adopted by GC and in-house teams to measure and report the value they bring to their organisation in terms of commercial advantage and mitigation of risks.'
In over three-quarters of organisations, the head of legal feels their department is expected to take a proactive approach to protecting the business, while just 8 per cent favour a reactive stance.
'A GC is not just a legal adviser, she or he is also a business adviser who drives innovation and shapes organisational risk culture,' added Dixon.
'The Law Society recognises in-house as an increasingly important group within our membership and we have developed a tailored programme of support for those who are, or aspire to be general counsel.'