The Corporate Legal Department/General Counsel has taken on a bigger role in strategic risk management for the company and is quickly becoming a trusted advisor for the C-suite and the business units in an increasingly connected world where risks propagate across traditional boundaries. The key question they grapple with is how to continue to play that strategic role and keep their seat at the table.Wolters Kluwer
Legal is witnessing a disruption thanks to legal technology. Legal departments can position themselves as strategic risk advisors with legal tech, says Wolters Kluwer. One of the key responsibilities of legal departments is to offer legal risk management and advice to their organizations. Whether the legal department is large or small, the onus is on them to identify legal risks and initiate a strategy to monitor and mitigate those risks.
The legal department should focus on educating their company and staff about the legal risks and ways to tackle them. In addition, legal departments can leverage outside counsel, law firms, and stakeholders in an effort to keep their company risk-free.
How to Position Your Department as a Legal Risk Advisor
The Future Ready Lawyer Report notes that 85% of legal departments are realizing the potential of legal tech and want to leverage it in a bid to streamline processes. What’s more, these legal departments understand the value of legal tech to improve productivity and integrate much-needed processes such as legal operations.
Building a Risk Mitigation Strategy
The goal of the legal department as a strategic risk advisor is to monitor daily processes and activities to identify legal and regulatory risks. By collaborating with resources within the department and across the organization, the legal department can mobilize a legal risk mitigation team to identify risks, monitor them, and target them before they wreak havoc on the company and cause litigation nightmares.
Identifying Legal Risks
The first step in legal risk mitigation is to identify potential legal risks. According to a Thomson Reuters article, legal departments should have a process in place to “update, distribute, collect, and carefully analyze risk assessment questionnaires covering topics such as compliance, business operations, product liability, litigation and business ethics.”
Create a Strategy to Implement and Monitor Risk Management
Legal departments can collaborate with general counsel and business units across the organization to implement a risk management strategy. The strategy should use metrics to evaluate how the strategy is working, where it needs tweaking, and to project its effectiveness.
Once the legal risk management strategy is hashed out, it should be presented to stakeholders, including the C-suite. The strategy’s progress and reports must be updated to all individuals regularly, to underline areas of progress and to identify what processes are working best. Ideally, risk management leaders should spearhead this initiative with the wealth of knowledge and skills they have in the field.
Establish Regular Communication
As part of their business intelligence processes, legal departments should collect data to fine-tune their legal risk management strategy. Data can be mined from questionnaires, meetings, and interviews with stakeholders and partners. It is important for legal departments and stakeholders to regularly meet so that they can keep the strategy up to date and review risk mitigation efforts across the board, especially when it comes to project management.
Share Material and Provide Risk Training
In order for a newly-launched legal risk management initiative to be successful, the legal department must share materials and offer training across the organization so that all concerned individuals can identify legal risks. The training efforts will guide non-legal staff on how to flag risks and take them up with the legal department or associated teams.
Legal risk management educational resources and materials need to be reviewed to ensure they’re compliant with the latest, and local regulatory and compliance measures. Working in tandem with the human resources department, legal departments can host or delegate training for all stakeholders on a regular basis.
The Future of the Strategic Risk Advisor
Legal departments are experiencing a change from a legal work-only department to being a key member providing valuable input for their organization. The key to making the shift to strategic legal risk advisor lies in meticulous planning, aided by legal technology. Identifying, mitigating, and pulling the data from risks for future risk management will be a driving force in uncovering the new face of the legal department.