CLOs’ corporate responsibilities soar to new heights
Chief legal officers (CLOs) are being tasked to oversee more functional areas of their business in 2022 than in 2020, according to the Association of Corporate Counsel (ACC).
The ACC’s CLO Survey, in partnership with Exterro, analysed data from 861 CLOs across 20 industries and 38 countries to determine the broadening responsibility of CLOs and how a continuously fluctuating business environment is impacting corporate legal departments more broadly.
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Among the findings was a push towards the “age of the CLO”, with the survey finding that 80 per cent of respondents report directly to the chief executive.
Among the responsibilities CLOs are being tasked with more include ESG (plus 9 per cent), public/corporate affairs (plus 5 per cent), compliance (plus 4 per cent), risk (plus 4 per cent), and communications (plus 3 per cent), the report found.
Tied in with this, 45 per cent of respondents said they’re planning on hiring more lawyers this year, while 29 per cent expect to hire more paralegals. Both figures mark a considerable jump from 2021, where 32 per cent wanted to hire more lawyers and 16 per cent wanted to hire more paralegals.
Despite hiring more staff though, 41 per cent of respondents still expect that they’ll have to send more work to law firms in 2022. This marks the highest percentage observed since 2019 and seven points higher than last year, the ACC flagged.
Further, the report survey shed light on legal operations investments. The findings revealed six in 10 legal departments now have at least one dedicated legal operations professional, three times higher than in 2015. In addition, 70 per cent of CLOs reported legal operations as their department’s top strategic initiative, the survey found.
Commenting off the back of the results, Veta T. Richardson, ACC president and CEO, said it’s clear that the role of CLOs is growing even greater importance from a corporate perspective.
“For the past several years, we’ve observed the CLO’s role steadily continue to expand in the C-suite and have pronounced these times to be the ‘age of the CLO’,” Ms Richardson said.
“But the disruption of the global pandemic and complexity of other challenges facing today’s businesses have accelerated unprecedented growth in the CLO’s range of responsibilities. CLOs are overseeing more corporate functions and to handle the additional workload, they are anticipating hiring increases across their departments.
“The unique skillsets and abilities that CLOs bring to the table make them invaluable business partners both strategically and for day-to-day operational issues – ensuring that this ‘age of the CLO’ will continue well into the foreseeable future.”
Commenting further, Bobby Balachandran, president and CEO of Exterro, said: “We’re thrilled to partner once again with ACC to promote this valuable resource for legal departments.
“The 2022 survey provides insights that reinforce the critical need for CLO’s to adopt new strategies for managing the legal governance, risk and compliance obligations facing their broadening scope of responsibilities, including legal operations, privacy, and regulatory and cybersecurity compliance.”