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In-house legal departments to expand

Posted by: Laurence Simons 21/05/13

Roughly a quarter of legal departments in Europe, the Middle East and Asia are set to expand over the course of the year, according to new research from Laurence Simons and the Association of Corporate Counsel.

Bucking the trend in global business towards downsizing in the current economic climate, the internal legal sector appears to be thriving - possibly as a result of the complex regulatory environment on show across the globe.

Another reason is that legal departments have taken on more responsibility, often coping with finance and regulatory issues in-house rather than using the external firms that have been given this role in the past.

Naveen Tuli, global managing director of Laurence Simons, said that the shift is endemic of a tendency towards greater control over budgets.

"Legal departments bringing more work in-house reflect a desire for greater control and certainty as a fixed workforce allows for better forecasting of budgets," he suggested.

Internal legal departments are now more likely to cope with banking and finance, insurance and reinsurance and other areas of the business - meaning that in-house lawyers may need to take on more responsibilities but will also be able to forge a more central role to how businesses are run.

"Many are making the decision that hiring extra permanent staff is more cost effective in the long run than continuing to outsource work. The new regulatory and financial landscape also places these areas at the core of any corporation," added Mr Tuli.

In-house lawyers will therefore be able to enjoy a faint blush of satisfaction as the prestige and importance of their position improves - recent reports have suggested that this emotion could be supplemented by a boost in income, as bonuses grow in the sector and redress the balance between private practice and their traditionally lower-paid counterparts.