From firefighters to horizon scanners: The evolving role of corporate legal teams

Is your legal department simply reacting to issues, or is it actively shaping the future of your organization by adding strategic value? 

Corporate legal teams are an invaluable asset when something goes wrong, putting out fires across the organization and combatting issues as they arise. Yet, we’re increasingly seeing this role evolve into one that’s more proactive and strategic.

With a wealth of technologies helping legal departments work more efficiently and reduce the time spent on repetitive administrative tasks, they now have the bandwidth and opportunity to explore the legal landscape in greater detail.

As a result, legal departments in many organizations are taking on more responsibilities, scanning the horizon to identify potential opportunities and risks that could impact the wider business.

This shift can have a huge effect on long-term business strategies, risk management, revenue, company reputation, and overall success.

What is horizon scanning – and how does it work?

Horizon scanning is the proactive process of identifying imminent trends and changes in the legal landscape that could result in either risk or reward for the wider organization. This can be achieved through various means, such as monitoring incoming legislation to ensure organizational alignment and reviewing contracts to identify potential problems or opportunities for gain.

Depending on the size of the organization and the industry it operates in, horizon scanning can cover multiple considerations and geographies. It can be a complicated process, which means legal departments need the right tools, solutions, and practices to effectively look ahead.

The process begins with collecting essential data to enable clear and informed decision-making. This often includes information collected from expert sources like the Association of Corporate Counsel, the International Association of Privacy Professionals, Thomson Reuters, LexisNexis, law firms, and other industry groups from around the world. These organizations provide updates on key events and drivers within political, economic, legal, and technological fields.

Legal departments can set up alerts for this content to gain specific insights into niche markets or locations. Alternatively, horizon-scanning software can be used to gather and collate analysis from experts, streamlining the process.

Once the data is collected, legal teams must analyze it to identify patterns and trends. They can then explore potential outcomes to help paint a picture of what the future might look like before conducting a risk assessment that delves into the possible impacts of each scenario.

Based on this analysis, the legal department can recommend strategies to avoid identified risks or seize a well-hidden opportunity.

Reduced risk and brighter opportunities

Legal professionals are trained in the art of identifying emerging trends and anticipating what the repercussions may be. By sharing these insights with leadership, legal can offer advice and guidance that can be used to make more informed decisions, shape practices, and develop strategies.

The benefits of this practice are numerous. By looking ahead, an organization can improve resource allocation, simplify compliance, reduce costs, direct research and development efforts, avoid disruption, prepare for uncertainty, and gain a competitive advantage over those not working proactively.

The most significant advantages fall under two main categories: proactive risk management, which is directly linked to both costs savings and company reputation, and the identification of emerging opportunities, which can lead to revenue enhancement.

One notable example of this was the rollout of GDPR in 2018. This legislation had a profound impact on data privacy practices, and adhering to the new regulation required a great deal of strategy and investment from companies in almost every industry. Organizations that were proactive in monitoring these changes were well positioned to get procedures and documents in place and move forward with minimal disruption.

Horizon scanning isn’t just about mitigating risk and ensuring compliance; it’s also a powerful tool for spotting emerging opportunities for your organization. For example, hidden details in contracts, like clauses that allow small annual charge increases, can easily be missed. In organizations with hundreds of thousands of contracts, this can result in significant revenue losses.

This underscores the importance of activities such as contract assurance. By conducting thorough contract reviews, with an eye on impending legislative changes, you can uncover hidden opportunities that would otherwise have gone unnoticed.

In a world where legislation is constantly evolving, and contracts are being drafted daily, choosing to anticipate and influence change, rather than allowing change to impact you, can make a measurable difference in your organization’s performance.

Horizon scanning isn’t something that will just happen organically. For it to be effective, it requires a committed legal team willing to dedicate its time to these activities. And, most importantly, a leadership team willing to give legal a seat at the table and listen to its advice.

Learn more about how iManage can support your corporate legal team.