Regulatory changes and increased regulatory scrutiny continue to be the top risks among executives in 2016, as per a survey by consulting firm Protiviti. Many executives are aware of the rapid changes happening in the business world, as over 50 percent reported that “rapid speed of disruptive innovations and new technologies within the industry may outpace their ability to compete and manage the risk appropriately, without making significant changes to our business model.”
The importance of risk mitigation planning and taking a tech approach to reduce or mitigate risk is becoming commonplace among legal professionals. The most common take-aways from specialised conferences and research are almost always the same: don’t wait for disasters to strike, or, risk management planning needs to be an ongoing effort. Although this sounds good in theory, it is far easier said than done.
The modern general counsel should have to focus on avoiding disputes before they even occur. In an ideal world, she would organise herself to become more selective between those enquiries that merit serious and immediate legal attention and those that do not. In reality, the modern GCs are faced with a crossfire of problems, questions and requests daily from all across the organisation and are firefighting every day.
Here you can find some practical tips to establish your long-term risk mitigation plan and daily routine in your legal department.
Avoid risks with effective monitoring
Risk avoidance is the elimination or avoidance of some risk, or class of risks, by giving your company regular compliance health check-ups. Here is how you can do that.
- Characterise the root causes of risks that have been identified in the past.
- Evaluate risk interactions and common causes
- Revise current risk assessment process or plan to implement one:
- Revise past similar cases and develop best practices: How were they solved, pleaded and in which cases your company had to go to court?
- How many cases were solved internally before going to trial? How long did those cases take to be solved?
- How did the selected legal firm handle the matter?
- Monitor your company’s current compliance with relevant laws:
- Revise your company’s compliance with anti-trust and anti-bribery polic
- Be aware of what’s going on out there: new laws and regulations
Implement tools to help you with legal functions
Multiple stakeholders, variety of contracts and terms, multi-jurisdictional influence and macro-regulatory requirements are factors adding complexity to the contracting and entity management landscape. You can reduce complexity and control your legal facts through a smart legal management system. What’s more, the right tools will help you minimise errors, driver efficiencies and control costs. For an example, you can mitigate contract risks by streamlining processes and managing contracts throughout their lifecycle.
Here is how efficient contract management can help you mitigate contract risks.
- You can set alerts for expiring contracts: to close/ renew contracts in due time.
- Receive policy update reminders: to ensure your business is compliant
- Receive key due dates reminders: to never miss deadlines for obligations
- Receive regular reports on existing and expiring contracts: to monitor status and take actions when necessary.
With a comprehensive risk management plan, in-house legal counsel can assume a more strategic role with the organisation by creating legal solutions that generate real business value.
Like to get started with risk mitigation planning? Download our free detailed Whitepaper: 7 Steps to Legal Risk Management for General Counsel and learn how to measure and manage legal risk for your business.