According to new research from ACC, more and more chief legal officers are reporting directly to the CEO, highlighting the importance of such roles in corporate governance and success.
The “Chief Legal Officers Survey”, published by the Association of Corporate Counsel, has revealed that 80 per cent of CLOs report directly to the CEO, marking a 16-point increase from last year. This, ACC, remarked, demonstrates the “growing importance” of giving CLOs a seat at the executive table.
Elsewhere, three in four (75 per cent) reported having an input on strategic decisions, which was a slight increase on figures from 2019.
“The strength of these results shows the enhanced position of the CLO within the organisation and how important it is for the business to give the head of legal a seat at the table,” ACC said in a statement.
ACC Australia and Asia Pacific vice-president and managing director Tanya Khan said the 2020 survey results further show that “we are in the age of the CLO”.
“In the wake of the findings of the Hayne royal commission, the challenges facing businesses today are much more complex, and boards are facing greater accountability and pressure to understand their company’s appetite for risk,” she posited.
“Therefore, a strategically positioned CLO and legal team can help establish and support a corporate culture that prioritises ethics, compliance, and other legal risk considerations.”
Elsewhere, the report queried CLOs about the biggest challenges they currently face: 60 percent indicated that new regulations, data protection and privacy rules are likely to be the cause for future legal concerns, while 58 percent also indicated that expenditure on regulatory compliance increased in the last year, with accommodation and food services, wholesale trade, and finance and banking reporting the highest percentages across all industries.
Moreover, legal tech continues to rise, with over half of CLOs saying that they plan to adopt new technological solutions. Sixty-nine per cent of CLOs expect that the use of AI in legal tech applications will accelerate, ACC noted.
ACC’s CLO Survey sought responses from 1,007 chief legal officers from more than 47 countries.