Australian in-house counsels are far from confident of their ability to deal with an expected sharp increase in regulator activity.
An overwhelming 72 per cent of in-house counsel practitioners expect to see an increase in regulator activity in the next 12 months, and yet two-thirds (62 per cent) are not confident they could identify and produce all relevant electronic documents in response to a legal or regulatory production request.
The findings are part of Deloitte's In-house Counsel Survey, which interviewed 209 in-house lawyers from the Australian private and public sectors.
"Given the current economic conditions, this result does highlight the need of corporates to look at ways they should prepare for and manage the process," says Deloitte Forensic Data Practice lead partner, Nicholas Adamao. "The anticipated increase in the level of regulatory enquiry is consistent with local and international governments demanding regulatory bodies utilise their investigative and enforcement powers in the wake of the global financial crisis.
"The pressure to deal with regulatory compliance typically falls on the shoulders of in-house counsel. Given the tight timelines for compliance, many may find they are not able to meet those deadlines nor suggest how long it may take for them to put forward their case."
According to Adamao, sound management should include putting the right systems and processes in place to facilitate document production, and if necessary engaging external consultants to assist.
Interestingly, 20 per cent of survey respondents cited providing regulatory compliance legal advice as one of the busiest areas of their legal practice. They also believed that the demand for advice about regulatory compliance will increase in the next 12 months.
In addition, more than half of respondents (56 per cent) indicated that their organisation has been required to produce documents in electronic form in the past 12 months.
"This figure is quite high, and may become even higher in the next 12 months," Adamao predicts.
However, the cost of electronic discovery remains a key concern. More than half of respondents (53 per cent) believed that electronic production and discovery will increase the costs of litigation.
- Mark Phillips