A rising level of threats to business, and increasing numbers of regulatory requirements, are combining to ensure in-house General Counsel are no longer focused solely on company legal matters. Instead, a new report from KPMG reveals that in-house lawyers’ work is dominated by commercial decision making as Boardrooms seek validation of their business and operational plans.
‘Over the Horizon’, which is based on a series of in-depth interviews with General Counsel, reveals that senior in-house lawyers have adopted six new core functional responsibilities, in addition to their role as legal advisers. Chief amongst these is a focus on cyber security, as concerns rise about the risk of data breaches brought about by human error and intentional sabotage.
Malcolm Marshall, global head of cyber security at KPMG, says: “In the last five years we've seen cyber security move from the back room to the Board room and, in extreme cases, the court room. Against this sort of backdrop few people will be surprised to see it come in as the fastest growing risk for General Counsel and that’s why in-house legal teams should have a seat at the table providing advice about the policies and vigilance required to tackle cyber risks for business.”
In addition to the new focus on cyber security, the report highlights that General Counsel are now expected to manage:
enterprise risks, such as geo-political events or technological failures
a rising tide of regulation as the ‘new regulatory norm’ increases global compliance demands
corporate liability for the conduct of third-parties
execution of contracts, in addition to long-held expectations around the negotiation and drafting of contracts
flexible approaches to dispute resolution, rather than an outright reliance on negotiation.
KPMG’s analysis goes on to reveal that there is a growing demand for in-house lawyers to conduct due diligence of suppliers, customers and other business parties, as corruption through the supply chain is tackled through increasingly tough legislative and judicial actions. According to the report, senior executives are also turning to their legal teams in recognition that their professional training ensures General Counsel can ‘take on complex issues, distil them and arrive at a sensible conclusion’ with many respondents indicating that their lawyers are more likely to find solutions to common business problems, than colleagues in other business departments.
David Eastwood, global head of contract compliance at KPMG, says: “As General Counsel roles become weightier, lawyers are making themselves indispensable as managers of risk and complexity. General Counsel who navigate this well will see their stock rise significantly. The challenge for General Counsel, of course, is that as their stock rises, so do expectations. It means the pressure is on for General Counsel to demonstrate the right blend of legal and business savviness. Those that grasp this opportunity will shape the long-term development of their organisations.”
Click here to view the full report.
Mike Petrook, KPMG Press Office
020 7311 5271 (t), 07917 384 576 (m) or email@example.com
Notes to Editors:
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with approximately 11,500 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2013. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 155,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.