Are the CLOs really influential within the firms?
The figure of the Chief Legal Officer (CLO) of a company is increasing in number and presence in the firms. The Association of Corporate Counsel has published a survey of 1007 respondents from 20 sectors in 47 countries.
This survey summarises the main circumstances of CLOs today:
Increasingly, CLOs are gaining more weight in firms, and their decisions within companies are more relevant. One factor that may reflect this influence of BOCs is the professional communication between CFOs and CEOs, with 80% of respondents claiming to report their work directly to CEOs.
The legal department in a firm deals with issues relevant to the business viability of the firm. In addition to risk management, 62% of CLOs are consulted on business risks, and a third of them are consulted on financial risks.
Typically, CLOs spend one-third of their work time providing legal advice, while the rest of their time is spent on business tasks such as contributing to the strategic growth of the firm, as well as advising the firm on executive and non-legal matters. That is why the CLO has to know in detail the objectives of the firm, its shortcomings and its current situation.
Both cybersecurity and data management are key issues in the legal sector today, and especially for firms. At least 60% of CLOs surveyed believe that data privacy is one of the biggest challenges facing firms today. Cybersecurity is also a pressing issue.
The application of new technologies can bring efficiency to firms, but it can also bring certain challenges. More than half of the CLOs surveyed are planning to implement new technology services in their firms, or have already implemented them, and 70% of respondents believe that the use of artificial intelligence in legal departments will be accelerated. The problem with all this? That the implementation of these new technologies can entail many costs for the firm, as well as a necessary preparation of employees and management of the added risks that the digital transformation could entail.
This survey was conducted from 17 September 2019 to 5 November 2019. The vast majority of the 1,007 respondents are CLOs.