Legal's Balancing Act: Risk, Innovation, and Advancing Strategic Priorities

As legal teams expand their responsibilities and business impact throughout their organizations, there’s a delicate balance legal professionals must strike in their roles: be better partners and balance risk.

To tease out this complex and dynamic relationship, Megan Ferraro, Associate General Counsel of eDiscovery and Information Governance at Meta, recently joined as a guest on Law & Candor.

Taking highlights and advice from our talk, we outline how legal's evolving role and the emergence of new risks is changing how individuals and teams should approach innovation.

The legal function's bigger role

Legal departments are playing a more significant part in strategy and innovation because the role of in-house counsel has changed greatly in the past few decades. There's been a considerable shift in forward-thinking companies from viewing legal as a blocker to more of a strategic partner.

Successful legal teams are partnering internally to ensure attorneys across their organization get early signals to address potential inquiries in litigation or investigations. Additionally, companies are now hiring in-house teams to fill roles where those legal partners can identify and assess legal risk early on.

In-house counsel have become advocates for why legal deserves a seat at the table at all company levels, which contributes to the overall success of the business.

A great example of how legal is partnering with other parts of their organizations to drive innovation is through the role of product counsel at technology companies. The most effective product counsel have a deep understanding of product goals early, which helps them to identify and address legal issues more quickly and accurately. By working closely with the product team through development, updates, and deployment, they also serve as a conduit between legal and product teams to help advance projects and address potential risks.

Critical risks for legal teams today

One of the most significant challenges for in-house legal teams is keeping up with the pace of their organization’s growth—whether it’s developing products and services, forging unique partnerships, or adopting new technology and software.

Often, business teams do not appreciate how even the slightest difference in facts can contribute to different outcomes in the law. Managing the expectations of the business regarding the time it takes to do legal analysis is extremely important.

It's normal to take the time to think about these challenging issues. An important adage for the business to remember is that the law is not “Minute Rice.”

The balancing act between risk and innovation

Weighing risk and innovation requires that you keep pace with changes throughout the organization, including pivots in strategic priorities, with a variety of stakeholders. Staying ahead of these developments and allowing counsel enough time to evaluate potential impacts is key to understanding if the benefits are worth the risk, and if not, how to adjust a business plan accordingly.

Along with providing the guidance stakeholders need to assess risk and make decisions, legal teams also frequently manage how organizational data is stored and accessed with IT departments. If other teams throughout the business do not have the information they need, they can't move as fast to help the company innovate. How long to keep data, what format it is in, and who can access it are all questions that can have a huge impact on innovation.

Cross-functional collaboration

In-house counsel are increasingly working with other leaders in their organizations to inform strategic decisions, but having a seat at the table requires listening and staying connected to “clients” within the business. Strategic priorities can change very often, especially in a fast-paced environment.

Knowing not just what these priorities are but how the business interprets them and what success means to the company will contribute to the most successful legal partners for balancing risk factors and supporting innovation.

To listen to the full conversation and hear more stories from the legal technology revolution, check out Law & Candor.