The corporate law department is shifting priorities as compliance rises to the top of global and Asia Pacific priorities. In this blog, we outline the key drawings from the 2023 state of the corporate law department report by Thomson Reuters.
65% of corporate law departments are experiencing increasing matter volumes, while 59% are dealing with flat, if not decreasing budgets. Increased legal spending is a common trend across nearly every global region, key practice area, and industry sector.
Law Department priorities
There is growing evidence of corporate law departments shifting work among outside law firms. This comes as a way of managing costs and optimising the value and cost-effectiveness they are receiving.
The priorities for Asia Pacific’s corporate law department align with the global priorities. These priorities include compliance, risk/litigation, cost control, commercial legal advice, and efficiency.
Commenting on the priority shift, Tim Hall, Head of Innovation and Technology at Law Image stated, “The constant evolution of regulations, particularly within the environmental, social, and governance (ESG) disciplines is causing our industry to prioritise their focus to compliance, regulatory changes factor heavily into what corporate law departments see as their biggest anticipated risks to the business in the Asia Pacific region in the near and long term.”
Trends impacting law department spend
Across the globe, generally one-third or more of corporate law departments expect to see an increase in their legal spending, with Australia expecting an increase of 33%.
Australia (-26%) show relatively modest Net Spend Anticipation (NSA) scores due to larger percentages of companies expecting a decrease in spending, likely a reflection of broader economic trends presented in those regions to a greater extent than in other areas of the globe.
In both the near- and long-term, regulatory changes factor heavily into what corporate law departments see as their biggest anticipated risks to the business.
One-in-five law departments see the potential for future risk in the area of data privacy, with a nearly identical share anticipating risk from ESG issues.
While interestingly, the UK leads in adopting a hybrid work model, with almost 93% of law firms operating on a hybrid work model. In the Asia-Pacific region, however, there is near parity between hybrid working (45%) and in-office working (43%) team members. Notably, it is the only region where hybrid working is below 50%.
Even as the environment for corporate law departments continues to evolve, it seems likely that hybrid working, while likely to continue to be refined, will be a fact in how modern law departments operate going forward.
About Law Image: Law Image is a leading document management company with offices in Melbourne, Sydney, Brisbane, and Perth. Law Image operates on a true on-shore model and is ISO 27001:2013 certified for information security. Equipped with an industry-leading data security model, Law Image assures to protect the integrity of our client’s information.
Contact Law Image at 1300 529 462 or click here to learn more about how we can help you with your document review projects.
For any media queries, please contact:
Marketing & Communications Strategist