Last week I had the pleasure of attending the 19th annual Economist General Counsel Summit taking place in London. It was a jam-packed event filled with fascinating discussions on a diverse range of topics, ranging from mitigating geopolitical risk and delivering on ESG goals to exploring how businesses can build a legal ‘dream team’. As Head of Legal at Luminance, it was fantastic to meet fellow industry professionals and have the opportunity to discuss how our roles have changed over the last year. From the conversations I shared, it was clear that the role of General Counsel has continued to expand in light of major economic, political and technological shifts.
I also had the privilege of speaking on a panel with Maria Barros, Senior Vice President and Chief Legal Officer at Booking.com, and Mark Gregory, General Counsel and Corporate Affairs Director at Rolls-Royce, about how legal teams can be more effective in delivering their services to create business value. I thought I would offer my own perspective on some of the key themes that emerged out of our conversation.
Transforming Legal from Cost Centre to Value Creator
For many organisations, in-house teams are still seen as a cost centre for the business. However, the advent of AI means that the opportunity for value creation has never been greater for legal departments. A key point of discussion at the conference was how defining an in-house legal team’s value from the outset is essential in achieving strategic goals for organisations, and this often starts with Legal assessing the regulatory environment the organisation must operate in and signposting any challenges to C-suite executives. Gaining swift insight into your contractual landscape enables legal teams to respond to ever-changing regulatory thresholds. As an example, just recently, IDEXX, an American multinational corporation, used Luminance’s AI to review 20,000 contracts in 20 minutes to identify any organisational exposure to recently sanctioned entities.
But ensuring regulatory compliance is just one way in which legal departments can deliver value to their organisation. Amid a global slowdown, many businesses are looking to tighten their budgets and AI like Luminance has emerged as as key tool for reducing outsourcing costs. Indeed, AI eases the strain placed on legal teams by reducing time spent on labour-intensive and routine review work, increasing the legal team’s capacity for value generation. For instance, with AI’s ability to automatically read and understand documents, legal teams can rapidly identify Termination Dates and keep abreast of when Sales Agreements are due for renewal, so they can proactively encourage business growth. Meanwhile, automated contract generation means that non-legal functions across the business can draft compliant contracts, putting less on the legal team’s plate and allowing lawyers to focus on higher-value work like complex commercial negotiations. With AI, legal teams are now poised to be the catalyst for a successful commercial process.
Accessing and Understanding Your Organisation’s Contracts
Another major theme at the conference was the challenge of dealing with your enterprise’s vast array of contracts, which is typically siloed across various storage environments in multiple repositories across different territories. Often these contracts can reference agreements made in separate letters or via emails, or indeed can be stuck on the hardware of employees that have since left the organisation! All of this means that it can be difficult for a legal team to achieve rapid insight into their business’s contractual landscape. With contracts being the centrepiece of any legal team’s day to day activities, this quickly becomes a critical issue when responding to urgent legal or commercial queries. As a Head of Legal, I know how difficult it can be to maintain visibility over your organisation’s contracts, so I was delighted to share my own experience of using Luminance, which allows my legal team to store our contracts in a single, AI-powered repository. With Luminance, not only do I have insight into signed contracts and the status of those under negotiation, but I also receive actionable data such as time spent reviewing third-party contracts and the percentage of terms changed during negotiation! It was clear from the industry professionals present that cutting-edge technology is increasingly being viewed as the key to better structuring enterprise data and creating a more efficient commercial processes all-round.
Legal Teams Need AI to Achieve ESG goals
Looking back on the global and policy shifts that have taken place in the past year alone, it is no surprise that ESG reporting has risen to the top of many legal teams’ agendas. And with COP27 upon us, this seems like an issue that will stay in Board packs for quite some time. On the panel, we touched on how legal departments can facilitate the path to meeting ESG targets. Much of the decision making around ESG goals begins with having complete visibility into your business’s data. With regulation constantly changing and consumer priorities shifting accordingly, AI provides a swifter ESG reporting process by providing instant understanding of a company’s existing ESG position, flagging (for example) all anti-bribery clauses present within contracts and even highlighting contracts where such provisions are not included. We’re increasingly seeing in-house legal teams use Luminance’s AI to assess contracts across their supply chains for Net Zero Standards and other ESG-related clauses, extending this to negotiations with suppliers. Further, when senior leadership, including the legal team, have access to this data, benchmarks to ESG goals can be reached more easily .
It was truly a pleasure to share the stage with Maria and Mark to discuss how legal teams can define and deliver value by better structuring their organisation’s data with AI and facilitating high-value legal work.
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