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Partnering for innovation and risk mitigation

In the push to embrace technology, lawyers, and perhaps in-house lawyers especially, find themselves caught in the middle of trying to adopt new tools and processes to help them get more work done efficiently, but at the same time weighing the risks of doing work in ways that may seem risky or too far ahead of what external counsel are offering in the way of advice. 

In our 13th Annual GC Roundtable, the Bank of Canada’s Jeremy Farr says he doesn’t think most external lawyers fully understand the role an in-house lawyer plays, which is to yes, be a risk manager, but also figure out how to get to the business objective without getting in the way of the business. Legal can’t hold back business and, certainly when it comes to cost containment anymore, the C-suite is less accepting of the answer that “legal is different.”

First and foremost, Farr says, he is the risk-management/second-line-of-defence/challenge-conventional-thinking person at the Bank of Canada. “You have to get your head in that space because you really spend a lot more of your day doing that than anything else.”

Knowing that, external legal providers should take careful note and start challenging conventional thinking more often themselves, whether it’s about the advice their clients are seeking on a legal matter or in pushing ahead with adoption of tools such as AI on due diligence and other matters where it is being proven to speed up projects and save clients money.

“The biggest thing I’d like to see is them help me in that risk allocation trade-off — don’t just give me a laundry list of what the issues are — I want the perspective of where can I be comfortable and where should I really be, knowing that the objective is to get the project done,” Farr says.

Beth Gearing of McKesson (Rexall) also notes that while law firms are good at issue identification, general counsel have to talk to their business leads and give sound advice on the probability something will happen but that when she asks external to rank the risk low, medium and high — they are often reluctant to do that.

As companies and law firms alike look to innovate both in their business and in their legal departments, law firms will be challenged to bring new solutions to the table and a mindset to match.

Both Shelley Babin of Ontario Power Generation and Gordon Ackroyd of SecureKey Technologies note that what they like that they are seeing from some law firms is that where they don’t have their own tech expertise they are partnering with legal tech entrepreneurs to bring the intelligence and solutions to the table. In their own in-house departments, they are recruiting different “non-law” talent in the form of data analytics professionals and legal operations professionals to bring new ideas to the table. So, when they see their law firms acknowledging a skills gap by partnering with others, they see a strength there. They know the risk is still being mitigated, but the innovation is also being embraced.