The vast majority (94%) of deputy general counsel (DGCs) in large UK-based corporations believe they work in “under-resourced” legal departments, researchers have found.
All the DGCs involved reported budget cuts due to economic uncertainty, despite the increasing volume and complexity of legal work, and said it was “very difficult to hire the right lawyers” to meet their needs.
There was also unanimity that DGCs were “feeling stressed or burnt out in their current role”, according to the report Navigating bigger burdens with smaller budgets while climbing higher ladders, produced by alternative legal services provider Axiom. The report was based on responses from 100 UK-based DGCs.
Researchers said almost half (48%) of DGCs with an under-resourced department said they lacked “the appropriate staffing bandwidth” for their team to do the job effectively.
“Perhaps more alarming, it’s not just that legal departments are generally understaffed, requiring team members to pick up more work, it’s that many DGCs don’t feel their team is capable of being successful with what they have available to them.”
Lack of staff was most commonly reported to be a problem in banking and finance (39%), real estate (36%), litigation (35%), new or emerging areas (34%), labour and employment (32%), and data privacy or cyber security (31%).
“And these shortfalls aren’t going away any time soon. DGCs anticipate additional areas of deficits over the next one to two years, further emphasising the growing complexity of the legal function’s workload, as well as the widening dearth of expertise.
“If budgets continue to shrink, and workloads continue to rise, more and more DGCs may find themselves in this bind and they will need to rethink how they source legal expertise to avoid falling even further behind.”
Three-quarters of those surveyed said flexible talent providers were the best resource “for a mostly/completely effective solution” to address legal department resourcing needs.
This was well above the proportion citing law firms (59%) or hiring additional in-house lawyers (54%).
The most popular answers to the question of why law firms did not work as a solution for DGCs was the “lack of institutional knowledge” (52%), followed by “administrative management takes too much time” (47%) and “law firms give conceptual legal advice and we need practical advice” (44%).
Other complaints were that law firms did not “prioritise our business”, had a “lengthy onboarding process” or lacked “commercial/business acumen”.
Only 15% of DGCs regarded law firms as “too expensive”, but researchers said this was “likely to increase as law firms roll out historic rate hikes (between 7–8%) over the next year—something that seems particularly out of step with a recession and client cost-cutting mandates”.
Against a background of feeling stressed or burnt out, 29% of DGCs said they were “actively searching for a new position”, while 37% said they were “open to a new position but not actively searching”.
The vast majority (94%) of DGCs said their current employer did not offer them the opportunity to develop all the skills required to become a general counsel, with 71% saying they would need to change employers to advance their careers.