Yesterday we saw a survey that showed in-house counsel are becoming more valuable to their companies, which sometimes translates to more money for general counsel. Now another survey shows that companies are spending less money on outside counsel. In fact, negotiating reduced prices with law firms is the number one way legal departments are cutting costs. Guess that money’s got to come from somewhere.
Law firm consultancy Altman Weil conducted a survey of 200 chief legal officers over the past year, and found that 71 percent of companies negotiated with their law firms to get lower rates. But sometimes negotiations aren’t enough, and 41 percent of surveyed companies changed some of their work over to firms that charged less.
This is the first time in three years that legal departments’ outside counsel spend decreased. However, for law firms worrying about losing their corporate clients, there is hope. The study also revealed that chief legal officers cared more about how well firms understood their company’s business than about financial factors.
Read more at Thomson Reuters.
See more numbers on legal spending on InsideCounsel below: