The message to general counsel and chief legal officers from their CEOs and CFOs could hardly be clearer: “Get the costs of your legal department under control or face the consequences. In the last decade, general corporate operating expenses have gone up about 20 percent, but overall legal costs have gone up 75 percent, far outpacing inflation. Our business got beaten up big time by the recession; time for you to share the pain and share the accountability.”
Henceforth, the memo goes, you must manage the legal function as proactively and efficiently as the company manages every other business unit — perhaps even more so, since the legal department is, after all, a cost center and not a profit generator for the company. Yes, you have more on your plate these days with increasing legal and regulatory demands, but it’s time to do more with less.
