Table of Contents Page 2 Leaders of Legal – Calendar of Events 3 Practical Law: Managing the Global Law Department 15 TR 2021 State of Corporate Law Departments 34 ACC-MLA Law Department Management Benchmarking Report 69 The General Counsel’s Guide to Legal GRC: 2021 79 Practical Law Multinational (info sheet) www.inhousefocus.com | [email protected] LEADERS OF LEGAL – UPCOMING EPISODES Register at www.inhousefocus.com PRACTICE NOTE Managing the Global Law Department by Practical Law Status: Maintained | Jurisdiction: United States This document is published by Practical Law and can be found at: us.practicallaw.tr.com/w-010-2768 Request a free trial and demonstration at: us.practicallaw.tr.com/about/freetrial A Practice Note discussing key issues in global law department management and identifying practical tips and strategies for general counsel to more effectively manage the global legal function. Topics covered include the composition of the legal team and its reporting structure, alignment of legal services with business needs, building a cohesive team, global communication, engagement and retention of team members, training and resource allocation, consistency of legal services, performance appraisals, and legal and cultural differences. As companies expand operations into the global These legal staff members may be integrated into a marketplace, they rely on their in-house law departments centralized global law department or may operate in to structure cross-border transactions and comply with decentralized pockets within their regions or business local law. To provide these legal services on a global scale, units. The company and its general counsel (GC) should many law departments have staff in different jurisdictions understand the scope of work covered and quality of and must find ways to efficiently and effectively manage services generated by these existing legal functions to their teams and resources. determine whether the composition and structure of the legal team meet the needs of the global enterprise. This Practice Note discusses key considerations and practical steps to take when managing a global law department. It addresses the assessment of the legal Assess Legal Team team, alignment of legal services with business needs, The GC should assess the global legal team by: reporting structure of the department, team-building and global communication, engagement and retention • Identifying all staff throughout the enterprise that provide legal services or support the legal function. of team members, training and resource allocation, This includes central law department staff and any consistency of legal services, performance appraisals, staff located in other US and non-US branch offices, and adjustments for legal and cultural differences. subsidiary and affiliate companies, operating divisions, While this Note focuses on managing law departments and other business units. based in the US with geographically dispersed legal • Mapping out where each staff member is geographically staff, many of the steps and issues discussed also apply located. to global law departments based in other jurisdictions. For a discussion of law department operations and • Determining their roles as attorneys, paralegals, management in general, see Practice Note, Law administrative assistants, or other staff. Department Operations: Overview. • Understanding the scope of their individual job duties. • Evaluating the qualifications, skills, strengths, and Understand State of Legal Function weaknesses of each staff member. Many companies add or inherit legal staff in different For more information on assessing the legal team, see jurisdictions following a cross-border merger or acquisition Practice Note, Practical Tips for New General Counsel: or during other expansion periods and reorganizations. Assess the Legal Team and Using Metrics to Measure © 2021 Thomson Reuters. All rights reserved. Use of Practical Law websites and services is subject to the Terms of Use (static.legalsolutions.thomsonreuters.com/static/agreement/westlaw-additional-terms.pdf) and Privacy Policy (a.next.westlaw.com/Privacy). Managing the Global Law Department Law Department Performance Checklist: Track Law – recognizing where similarities in business activities Department Staff Productivity. across different locations allow for efficiencies in legal services; and Check Service Alignment – considering licensing requirements and other legal The GC should determine if the company’s current practice restrictions in each jurisdiction. For example, some countries require in-house attorneys to carry legal staffing is effective and efficient in handling the local bar memberships while others do not. broad range of cross-border and local transactions and navigating the vast array of regulatory requirements • Determine if legal staffing and service are aligned to that apply to a multinational company. To make this business needs. The GC should: determination, the GC should: – understand if the legal staffing at each location can • Identify the company’s overall legal needs. For adequately handle the workload at that location; example: – determine if legal staff are over or underutilized, – determine the geographic locations of all offices considering the best use of each staff member’s and employees and where business activities are time and skills (see Lean for Law: Legal Process conducted; Improvement Checklist); – discuss with senior management the company’s – ensure that work is properly allocated based on business goals and any strategic initiatives tied to legal specialty, skills, and experience and that those goals; legal staff are not competing with one another for clients; – survey key business personnel concerning their day- to-day legal needs and any special projects that may – solicit feedback from key business personnel on the require legal counsel (such as new product launches, quality of legal services (for a sample survey form, marketing campaigns, or strategic alliances); see Standard Document, Law Department Client Satisfaction Survey); and – solicit feedback from legal staff on the company’s legal needs; – identify any gaps in the legal talent required to address needs, mitigate risks, and achieve the – identify the types of legal agreements most company’s strategic goals. commonly entered into by the company (for information on tracking the company’s contracts, • Consider different legal staffing models. The GC may see Practice Note, Contract Management: Overview: need to reorganize legal staffing to better serve the Maintain a Central Contract Register); business. For example, different staffing models may have in-house counsel: – review the company’s intellectual property portfolio and the steps needed to protect those assets (see – located at central headquarters; Brand Protection Toolkit); and – stationed at regional and local offices (as local – coordinate with compliance, internal audit, risk counsel, expatriates from headquarters, or a management, and other internal teams to conduct balanced mix of the two); an enterprise-wide risk assessment, develop a risk – embedded in business units; profile, and understand the company’s risk tolerance (see Practice Notes, Practical Tips for New In-House – organized by function or skill set; Counsel: Determine the Company’s Risk Profile and – designated as subject matter experts to support Developing a Legal Compliance Program: Conduct specific legal issues across geographic and business an Initial Risk Assessment and Address Key Risks). functions, or • Recognize the specific legal needs of each business – operate based on a combination of these models. location. This includes: – understanding the nature of each location’s business Select Reporting Structure activities and the primary regulations that govern them (such as anti-bribery laws and regulations) There is no one-size-fits-all approach to organizing a (see Bribery and Corruption Toolkit); global law department and its reporting relationships. The reporting structure should optimize the global law – knowing where revenue is generated, joint ventures are established, and third parties are engaged; © 2021 Thomson Reuters. All rights reserved. Use of Practical Law websites and services is subject to the Terms of Use 2 Practical Law (static.legalsolutions.thomsonreuters.com/static/agreement/westlaw-additional-terms.pdf) and Privacy Policy (a.next.westlaw.com/Privacy). Managing the Global Law Department department’s performance but may vary depending on • Centralized reporting. Whether located at factors like: headquarters or geographically dispersed, legal staff in a centralized reporting structure have solid line • The size of the company and its legal needs. reporting relationships up to the global GC at the parent • Its industry sector and the nature of its business. company level. This is the most common structure and often cited by law departments as a best practice. • The company’s geographic locations. • Decentralized reporting. In addition to a central • The organizational structure of the enterprise as a legal function located at the company’s headquarters, whole, including whether management and decision- legal staff in a decentralized reporting structure are making are centralized or decentralized. embedded within branch offices, subsidiary and affiliate The GC may have authority to implement widespread companies, operating divisions, or other business units. changes to the law department’s reporting structure These legal staff have