Navigating EOFY and securing more budget
Law department leaders face “significant pressure” at the end of each financial year. However, this period also offers tremendous scope for corporate legal to push for what it needs in the following 12 months.
In conversation with Lawyers Weekly, LOD Australian managing director Paul Cowling reflected on the fiscal headwinds facing general counsel and chief legal officers at this time of year.
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“GCs are under significant pressure at EOFY as they are responsible for effectively managing the department’s budgets and ensuring the complete use of the current year’s budget to avoid future reduction,” he explained.
“GCs may also need to prioritise certain requirements and obligations to be achieved within an allocated budget while balancing value and quality of work.”
The current economic climate may be exacerbating such concerns for law departments across sectors, Mr Cowling noted; however, this only serves to reinforce the need for corporate legal to state its case.
“The current economic times have led many businesses to reduce budgets and look for cost-cutting strategies. Now, more than ever, GCs need to emphasise the value of their legal support and its impact on the business’s bottom line,” he argued.
“Investing in legal resources can mitigate risks and ensure compliance, leading to long-term cost savings.”
“GCs may need to look for creative ways for managing budget restraints,” he went on.
“For example, while there may not be sufficient budget to employ another permanent GC, a short-term secondee could support the team in achieving outcomes at a lower cost to the business.”
When asked how best law department leaders can push for leftover budget to spend at this critical juncture, Mr Cowling responded that EOFY offers more than just the chance to grasp those residual funds — it also is a window to push for more budget for greater output in the next financial year.
“Identifying urgent matters or planning for upcoming projects provides a clear allocation of leftover budget,” he said.
“In-house teams are fundamentally there to protect organisations by identifying and managing risks. Some effective ways to use leftover budget and add value to the legal department include flexible legal secondments to address bandwidth or skill set gaps, engaging external counsel for high-value and high-complexity matters and implementing tech solutions for commoditised and lower-value work or to streamline processes.”
There is a multitude of benefits that will flow, Mr Cowling went on, for businesses that are able to allocate leftover budget for law departmental capabilities and resources.
“Allocating leftover budget to GC capabilities and resources supports businesses by increasing their capacity to handle legal matters promptly and effectively. Investing in additional legal professionals to support the team creates safeguards for the future and improves output and business compliance,” he submitted.
“Now is the time for GCs to invest in technology that improves efficiency of the legal team, leading to long-term cost savings for the business.”
“Investing in legal technology can streamline processes, automate routine tasks, and dramatically improve productivity.”
Ultimately, Mr Cowling mused, EOFY is an opportunity to reflect on the achievements of the law department over the past 12 months and explore possible improvements for the future.
“Now is the time to invest in a highly skilled and experienced team, complemented by legal technologies and automation to enhance operations and efficiency,” he proclaimed.
“We believe that a successful legal (and business) team is the result of combining talented professionals with advanced tech platforms.”