More than four out of five companies plan to reduce their spending on legal services over the next two years, a new survey from accounting and legal services firm EY found.
Yet as the need to rein in legal costs grows, corporations will need to achieve this “while remaining compliant with a complex and ever-changing regulatory environment"—a significant challenge, the survey concluded.
Law departments and law firms should respond by doubling down on technological innovation, EY’s top law division official said in a statement.
The survey polled 1,058 senior legal practitioners from businesses in 25 different countries.
On average, organizations plan to reduce their legal function costs by 11%, according to the survey. Forty percent of respondents believed costs would drop between 1% and 10%, and another 37% said they would drop by between 11% and 20%. Five percent said costs would drop by more than 20%.
North American-based corporate lawyers predicted that they’d cut costs slightly more aggressively than officials from other regions.
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