A View From the Coal-Face: Corporate Governance Issues in Charging Out and Incentivising In-House Counsel

Abstract

Information on a company’s costs and risks is crucial to the individuals responsible for the management of the organisation. The in-house legal function has an obvious role to play in dealing with the legal – statutory and regulatory – risks. Less obvious is management’s ability to leverage in-house counsel’s involvement in the day-to-day operation of the organisation in order to obtain important information on the company’s business (commercial or enterprise) risks. This article considers two scenarios where organisational decisions regarding the in-house lawyer’s internal charge-out or remuneration can support or hinder the company’s business risk management. The two scenarios apply particularly with organisations that frequently submit tender offers or proposals in a competitive situation.