Biggest Pressures on Business Lawyers Today Include Pace of Change, Compliance Complexity, Talent Challenges
The increasing complexity of compliance, new client expectations, talent challenges and productivity demands are pressuring legal professionals as never before, according to the findings of Wolters Kluwer’s new global “Future Ready Lawyer” survey.
The survey also finds that more progress is needed as most legal professionals say they are not well-prepared to address key challenges and opportunities.
Challenged to keep up with emerging trends and escalating demands, legal professionals are increasingly turning to legal technology for help. Across Europe and the U.S., the investment and demand for legal tech solutions have accelerated, with technology now firmly at the center of improved performance, productivity, client-firm relations and talent expectations.
According to survey findings:
• 91% of corporate legal departments are expecting their law firms to fully leverage technology.
• More than 80% of lawyers say it’s of high importance to them to work for a tech-savvy law firm or legal department.
• The “Increasing Importance of Legal Technology” is a top trend for 79% of lawyers.
• 64% of legal departments and 63% of law firms will increase their software investments over the next year.
” Lawyers already work in a high-pressure environment, and the Future Ready Lawyer Survey 2022 found that demands are growing as trends impacting the legal profession continue to accelerate,” said Martin O’Malley, Wolters Kluwer Legal & Regulatory CEO. “The pressure further intensifies as only about one-third of lawyers say that they are very prepared to address these trends. As legal professionals look to bolster their capabilities, the survey found that - more than ever - organizations are turning to technology as a lever to improve performance.”
The survey includes insights from 751 legal professionals across the U.S. and 10 European countries. In its fourth consecutive year, the survey offers a timely perspective with benchmark data pre- and post-COVID crisis on trends, capabilities and changes in the profession and examines how well-prepared organizations are to drive higher performance.
Key Survey Findings The top trends expected to have the most impact across the legal sector over the next three years are:
• Increasing importance of legal technology - 79%
• Coping with increased volume and complexity of information - 79%
• Meeting changing client/leadership expectations - 79%
Just 36% or fewer lawyers say their organization is very prepared to keep pace with any of these trends. New and growing areas in law are another big trend impacting lawyers:
• 77% report that coping with emerging and growing compliance areas, such as Environmental, Social and Governance (ESG) and data privacy, is a significant trend.
• 56% of corporate lawyers and 45% of law firm lawyers report increased demands for ESG guidance over the past year. Most say their organization is not very prepared to keep up.
Also, clearly established in 2022 is the trend on changes in how legal work gets done and who is doing it with each area showing increases over prior years:
• For corporate legal departments: 84% report greater use of contract staff; greater use of non-legal staff to perform work; and greater use of alternative legal service providers.
• For law firms: 81% report greater use of third-party or outsourced resources; 78% report greater use of non-legal staff to perform work and greater use of contract staff; and 77% report more client self-service.
The 2022 findings also build on prior years’ survey results relating to performance trends, which show that across a wide range of areas legal organizations that fully leverage technology outperform organizations that do not.
• Law firms that fully embrace technology were once again more profitable than those that do not: 63% of technology- leading firms report their profitability increased over the past year compared to 46% of other firms.
Legal organizations felt the impact of the “great resignation” over the past year, and based on survey findings, more talent challenges are coming:
• 86% of corporate lawyers and 70% of law firm lawyers say the great resignation has had a very or somewhat significant impact on their organization.
• 70% of corporate lawyers and 58% of law firm lawyers say they are very or somewhat likely to leave their current position in the next year. Organizations are not well-prepared to handle the talent churn. Only:
• 33% of legal departments are very prepared to recruit/ retain legal staff; 36% are very prepared to recruit/retain technology staff.
• 28% of law firms are very prepared to recruit/retain legal staff; 33% to recruit/retain technology staff.
Technology is crucial to talent:
• 87% of corporate lawyers and 83% of lawyers in law firms say it’s extremely or very important to work for a legal organization that leverages technology.