Survey finds majority of corporates happy with external legal advice

Survey finds majority of corporates happy with external legal advice

BY ALB | Friday 16 March 2012

A new survey has found that more than 90 percent of in-house counsels outsource legal work and more than half are satisfied with their external legal advisers. Deloitte’s 2012 Corporate Counsel Survey also found that more than 90 percent of surveyed in-house lawyers had either seen an increased demand for their legal services (48 percent) or a steady demand on services (44 percent) as a result of economic conditions.

However, while they are seeing a greater demand for legal advice from within their organisation, 27 percent reported that their outsourcing budgets had been reduced.  In the face of budgetary and other challenges the survey found that corporate counsels are continuing to embrace the outsourcing of legal services, including to offshore providers. “In this environment, and at the top end of the legal services supply chain, Corporate Counsel are having to deliver more for less as they maintain a strong focus on providing high quality but still cost effective legal services,” said Deloitte partner and leader of the legal sector group, David Lombe.

96 percent of respondents said they outsourced at least some legal tasks to external providers; 58 percent said they primarily outsourced more complex tasks, while 41 percent said both routine and complex tasks were outsourced. Most common work outsourced included mergers and acquisitions, industrial relations and contract management.

The level of satisfaction with legal outsourcing providers was high, with 63 percent moderately satisfied and 30 percent highly satisfied. Only 27 percent outsourced work offshore, primarily to external law firms. “Being open to different ways of doing things, including outsourcing tasks here and overseas, is one way in which they are able to further improve their cost management,” said Lombe.

Deloitte general counsel Leslie Moore added: “The intense cost pressure under which our clients operate, and the broader consolidation and globalisation of the sector, means that the demand for legal process outsourcing is stronger than it has been for some time.”

In the year ahead respondents expect to be busy predominantly with commercial work (63 percent), regulatory compliance (48 percent) and merger and acquisition activity (25 percent), which may indicate improving economic conditions.

The NSW Law Society’s Corporate Lawyers Committee assisted Deloitte with the survey, which was completed by 257 respondents from a variety of ASX 200 companies, Australian subsidiaries of foreign companies, public sector organisations and other listed and private companies.