Pandemic pushes corporates’ legal spend higher
Law firms are one of the few winners in the pandemic with corporates planning to increase legal spend this year, new research shows.
Some 38 per cent of UK companies polled by Thomson Reuters are planning to increase their legal spend, almost twice as many planning to make cuts. It is partly driven by demand for UK based law firms as companies expand internationally.
The report shows 80 per cent of corporates in the UK are actively looking for legal support overseas, a trend that has grown steadily since 2017.
While companies plan to increase the money spent on legal fees there are growing concerns over the cost in the last year. The Thomson Reuters state of the legal market report reveals more corporates are willing to push back on pricing, largely due to already diminished finances caused by the pandemic.
The report also shows just how much the legal market has changed in the past year, with remote working now embraced by the majority of UK lawyers.
Some 42 per cent of UK partners said remote working has improved working practices versus 34 per cent of senior lawyers globally. This new way of working has also pushed firms to start investing in new technology and three quarters of partners surveyed called for more investment.
Currently 41 per cent of firms are not using alternative legal service providers, such as legaltech or the Big Four accountancy firms, slipping behind their US counterparts. It suggests UK firms are still keeping certain functions, such as legal research and litigation support in-house rather than outsource them as a number of US firms have chosen to do.