The Association of Corporate Counsel (ACC), the world’s largest global network of in-house counsel, has released its yearly survey of chief legal officers (CLOs) around the world. Feedback from 1,639 CLOs in 55 countries, including 38 from India, painted a compelling portrait of the modern CLO’s top concerns: sustainability, disruptive technologies, privacy laws, data security, and protecting a brand’s reputation.
But more significantly, the report is a testament to the “age of the chief legal officer.” The proportion of CLOs who report directly to the chief executive officer (CEO) has jumped from 64 percent to 78 percent, a leap of 14 points. This year’s survey shows that CLOs are assuming positions of greater power and influence within their companies, and taking on roles beyond that of technical legal adviser. Nearly 70 percent of CLOs surveyed indicate that the executive team almost always seeks their input on business decisions. Last year, that level was 11 percentage points lower.
It’s worth noting, however, that these figures are lower across Asia and South Asia than they are worldwide: only 67 percent of Asian CLOs report to the CEO.
The report also asks CLOs which issues give them most concern. Just over two thirds of CLOs surveyed said that data breaches will be extremely or very important in 2019, followed by regulatory or governmental changes, information privacy, and technology developments. Indian respondents were particularly interested in the laws around corporate whistleblowing. Meanwhile, the top issues affecting their companies’ business decisions in the year ahead are new regulations, brand reputation issues, disruptive technology, and mergers and acquisitions.
CEOs are most likely to ask the CLO about growth, while boards tend to ask the CLO questions about risk or compliance.
Forty-five percent of CLOs expect their budgets to increase in 2019. This is down slightly from 56 percent in the 2018 survey.
As CLOs solidify their place in the C-suite, they increasingly oversee corporate functions other than legal. Compliance is the most common corporate function reporting to the CLO, but beyond this legal adjacent function, one in four CLOs oversee government affairs, and one in five oversee human resources.
Two in three CLOs regularly attend board meetings (68 percent). CLOs who report to the CEO are more likely to state that they almost always attend board meetings (75 percent vs. 46 percent).
Forty-seven percent of respondents reporting that they anticipate M&A activity in 2019. ACC will publish a special report highlighting additional findings and trends in February 2019.
For more information on the 2019 ACC CLO From sustainability to data Survey, please visit www.acc.com/closurvey
“From sustainability to data protection, the issues pressing on businesses are growing in urgency and complexity. The CLO and his or her legal team are uniquely qualified to advise the CEO and the board of directors on how to chart a path forward, taking the law, ethics, culture, and risk tolerance into account. This year's survey leaves no doubt that we are experiencing the age of the CLO, and that companies are awakening to the significant role their CLO can and should play.”
The Association of Corporate Counsel (ACC) is a global legal association that promotes the common professional and business interests of in-house counsel who work for corporations, associations and other organizations through information, education, networking, and advocacy. With more than 43,000 members in 85 countries employed by over 10,000 organizations, ACC connects its members to the people and resources necessary for both personal and professional growth. By in-house counsel, for in-house counsel. For more information, visit www.acc.com and follow ACC on Twitter: @ACCinhouse.
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