Economic worries: UK lawyers far more concerned than US counterparts
In-house lawyers based in the UK are more concerned by the risk of economic instability than colleagues in other parts of the world, a large-scale global study has found.
In-house legal departments in the UK were also significantly more likely to have adopted hybrid working than those in mainland Europe or the USA.
The 2023 State of the Corporate Law Department report, by the Thomson Reuters Institute, was based on over 1,500 interviews with in-house legal professionals.
It found that when it came to risks over the next three to five years, economic or currency instability was cited by 22% of UK lawyers as the biggest one, twice the figure for the US (11%) and much bigger than that for mainland Europe too (13%).
However, the risk most cited by UK lawyers was regulatory changes and changes in the law (30%). Data privacy (17%), performance on environmental, social and governance (ESG) or diversity and inclusion (17%) and cybersecurity (17%) were seen as less significant.
In the US, data privacy was the most commonly mentioned short-term risk (29%).
Researchers said regulatory change was seen as “a key area” worldwide. “Data privacy and cybersecurity stand out more in the United States and Canada, with both regions seeing anticipated levels of future risk that exceed the global average.
“Potential future risk from ESG changes is of particular concern to law departments in mainland Europe.
“And given the lingering uncertainty around the long-term impacts of Brexit, it is perhaps unsurprising that UK departments report a higher-than-average level of concern about risks due to economic uncertainty.”
Nearly half of the UK teams expected to increase their legal spend this year, although 31% predicted theirs would fall.
The UK was the least likely region in the world to have in-house legal departments where most or all staff worked in the office full-time (5%) and the only region with no departments where most or all staff worked remotely full time.
The proportion of staff working on a hybrid basis, at 93%, was considerably higher than mainland Europe (84%) and the US (64%).
Asia-Pacific was the only region where almost half of in-house legal departments (43%) had the majority of staff working full-time in the office.
Two-thirds of departments reported that they required staff to be in the office for a minimum number of days per week, usually two or three.
Researchers said: “Enforcement of this expectation can be another question, and one with which businesses still appear to be grappling.
“Many complain that even when a certain number of days is mandated, the purposes of being in the office, such as camaraderie, collegiality, and collaboration, can be frustrated if the other team members key to these interactions don’t happen to be in the office at the same time.”
The top priorities for in-house lawyers globally were compliance, risk/litigation mitigation and cost control. However, in the UK the top priority was providing their company with commercial legal advice, followed by cost control and compliance.
Hillary McNally, general manager for corporate legal at Thomson Reuters, commented: “Corporate legal departments across the globe are experiencing increased work due to the ever-changing compliance and regulatory burdens with in-house teams experiencing significant burnout.
“Additionally, many departments are anticipating the need to closely watch budgets, while at the same time matter volumes are up, putting more pressure on internal staff and resources.”
“As workloads and uncertainties rise, there is also a greater willingness to shift work to smaller firms with a lower cost, and technology can help departments make data-based decisions without compromising outcomes.”
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