When we set out to determine which Canadian companies were the biggest employers of legal talent, we weren’t sure what we were going to find. We wanted to see how companies stacked up to the test of time. So using the Canadian Law List (www.canadianlawlist.com), the country’s oldest legal directory, we poured over the lists for three periods: 2006, 1996, and 1981.

The way the list is structured is that it includes lawyers (and notaries in Quebec), who are called to the bar and paying their fees at that time.

It does not necessarily mean the lawyers are focused entirely on practising, but could also be working purely in a business capacity, such as operating as a financial adviser at a financial institution or running a company or its division. In fact, one of the more interesting things we noted was the diverse range of legal titles people are assuming these days.

So the list is not a statement of the exact size of a corporation’s legal department, but it’s fairly close. It also doesn’t include the number of lawyers a corporation has hired outside of Canada’s borders. We focused purely within our own borders. We also didn’t look at government departments, which are some of the biggest employers in the country when it comes to legally trained individuals, but we did include any relevant Crown corporations.

We also tried to look at the big picture, so, for example, in the case of banks we looked at them as a single entity and tallied their employment figures across the various operating companies to include things like insurance and brokerage.

Our goal was to get a sense of where the opportunities for lawyers lie these days and which industries or companies have become sophisticated enough to employ the majority of legal talent. We also wanted to get a sense of growth in legal jobs within corporations.

Remember, though, like any top 20 list, it’s simply a snapshot at a moment in time and its accuracy fluctuates like a stock market, rising up and down with the movement of lawyers and merger and acquisition activity. Today’s top dog could be tomorrow’s mutt.


Public companies rule the roost

So what did we find? It came as little surprise that the top employers of legal talent are publicly traded companies and our list somewhat reflects the TSX rankings of top stocks based on market capitalization — suggesting the bigger you are, the more lawyers you hire.

As such, our list is heavy on financial institutions and energy companies. Canada’s five biggest banks alone employ about 10 per cent of lawyers who work in corporations. RBC Financial Group leads the list, followed by CIBC, and the Insurance Corporation of B.C., which handles claims from that province’s no-fault insurance system. Rounding out the top five are BCE and Manulife Financial.

The remaining list is made up of insurers, including Stewart Guaranty Title — which didn’t even exist in Canada a few years ago — the other big banks, a few oil and gas companies, and a number of power companies. Only one industrial, Bombardier, makes the list. Canada Post also makes the cut, as does the Société québécoise d’information juridique (SOQUIJ), a Quebec legal publisher, and the Canadian Broadcasting Corporation.


Passing the torch

What was surprising, though, is how fluid the list is and how it has changed over time to reflect our changing economy and the rise and fall of corporate Canada. To make the list today, a company would need to employ at least 20 lawyers. In 1981, 20 lawyers would put you in the top five.

Twenty-five years ago, only one of the banks, CIBC, even made the top 20, and it ranked below Canada Permanent Trust. In 1981, the top five employers of legal talent included a diverse collection of companies from the transportation, telecommunications, financial, and power industries. Canadian Pacific Ltd. topped the list, tied at 45 with the Business Development Bank of Canada, which then employed lawyers in offices across the country. Next were Canadian National Railways, Bell Canada, and B.C. Hydro.

The remaining were insurers, trust companies, and oil and gas companies — many of which don’t exist in name anymore — and oil and gas companies were prominent employers on the top 20 list. While more economic sectors such as mining and pulp and paper and even technology were present in the 1981 mix, by 2006, they had dropped out of the top 20. Those companies may still employ a number of lawyers, but they have not kept pace with the growth of the banks, insurers, power corporations, and telcos.

During the 25-year span we studied, the number of lawyers employed in the corporate sector has tripled. Employment rose from 1,125 individuals in 1981 to 2,546 by 1996 and hit 3,329 in 2006. That works out to a compounded annual growth rate of roughly 4.3 per cent, almost double the 2.2 per cent endured by the private bar over the same period. In 1981, 30,098 lawyers toiled in law firms, compared to 52,247 by 2006.
The number of departments in which lawyers are listed — which includes either geographic location or a division within a company — has also exploded, from 324 in 1981 to 1,313 today.


Financial services explodes

But the real story is the explosion in financial institutions and their emergence as powerhouses in the employment of internal legal talent.

That’s no surprise, says Jean-Paul Bisnaire, senior executive vice-president, business development and general counsel at Manulife Financial. “The financial services industry has continued to grow over the last several years. Our business is very highly regulated and as a result of that I think there’s been a natural growth in the number of in-house lawyers to provide services to our clients internally.”

David Allgood, executive vice-president and general counsel at RBC Law Group, part of RBC Financial Group, says it is no surprise that over the past 25 years banks have gained prominence as Canada’s top legal employers.

He notes that there are 85 lawyers alone in his group focused on practising law internally. He says over the past 25 years banks have grown into diversified financial businesses, with much of that growth taking place in the 1990s. That’s when the pillar separating banking, trust, insurance, and brokerage services fell and consolidation and acquisitions took place. For example, RBC acquired brokerage and trust businesses and entered the insurance market, as did many of the other major banks.

Richard MacKenzie, vice-president, law at Bank of Montreal in Toronto, notes that 20 years ago banks didn’t have securities or insurance subsidiaries. “None of these activities existed and now they do. As the businesses have grown, the support groups, including the law, have grown.” He adds that the larger financial institutions have “been able to grow in a constrained way,” even though bank mergers are outlawed.