While relationships are cut, the amount of work sent to outside firms likely stays the same
Among the more than 1,000 respondents of the ACC’s annual survey, 10% said they will definitely end relationships with underperforming outside counsel or law firms this year. Meanwhile, 36% said they may do the same. In 2016, 31% said they terminated at least one law firm or outside counsel relationship due to underperformance.
The amount of work in-house legal departments send outside the firm is likely to stay the same, however, with 48% of chief legal officers anticipating the amount of work send out to remain the same this year. A significant 31% even said they will increase the amount of work outsourced, while just 18% said they will insource more matters. Those who said that they may terminate outside relationships this year noted intent to hire a new firm to perform the same work done by former outside firms.
According to the study, there was only a minimal change to total law department budgets year-on-year. Comparing outside budgets and inside budgets, however, revealed that estimated increases to inside budgets were slightly larger than for outside budgets. Meanwhile, 26% of top in-house lawyers said they would grow their departments this year, the same as the response last year.
Meanwhile, ethics and compliance topped the list of in-house lawyers’ most pressing concerns, with 74% of respondents rating it as extremely or very important in the next 12 months. This was followed by regulatory or environmental changes with 71%, information privacy with 68%, data breaches and protection of corporate data with 66%, and technology developments with 59%.
Another noteworthy finding of the study is that a gender pay gap still exists among in-house counsel. Male CLOs are more likely than female peers to make US$300,000 (or about $400,000) annually, in line with results last year. More female than male CLOs also make less than $200,000 (or about $265,000) a year.
Most firms lack cybersecurity crisis management playbooks, GCs reveal
US GCs upbeat on Trump administration