Deloittes documents regulatory challenges for Aus
Deloittes documents regulatory challenges for Aus
March 9, 2009: Seventy two percent of respondents to Deloitte’s 2009 In-house Counsel Survey expect to see an increase in regulator activity in the next 12 months, and yet the vast majority are not confident that they could identify and produce all relevant electronic documents in response to a legal or regulatory document production request.
Of the 209 in-house lawyers from the Australian private and public sector that responded to the survey, almost two-thirds (62%) of survey respondents indicated that they were not confident that they could identify and produce all relevant electronic documents in response to a legal or regulatory request.
According to Nicholas Adamo, Lead Partner of Deloitte’s Forensic Data practice, “Given the current economic conditions, this result does highlight the need of corporates to look at ways that they should prepare for and manage the process,” he says.
“The anticipated increase in the level of regulatory enquiry is consistent with local and international governments demanding regulatory bodies utilise their investigative and enforcement powers in the wake of the global financial crisis,” he says.
“The pressure to deal with regulatory compliance typically falls on the shoulders of in-house counsel. Given the tight timelines for compliance, many may find that they are not able to meet those deadlines nor suggest how long it may take for them to put forward their case,” Sound management should include putting the right systems and processes in place to facilitate document production, and if necessary engaging external consultants to assist.
Interestingly, 20% of survey respondents indicated that providing regulatory compliance legal advice as one of the busiest areas of their legal practice. They also believed that the demand for advice about regulatory compliance will increase in the next 12 months.
The Deloitte In-house Counsel Survey has also revealed that more than half of the survey respondents (56%) indicated that their organisation has been required to produce documents in electronic form in the past twelve months.
“This figure is quite high, and may become even higher in the next 12 months,” predicted Adamo.
However, the cost of electronic discovery remains a key concern. More than half of the survey respondents (53%) believed that electronic production and discovery will increase the costs of litigation.
Other key findings of the survey include:* 78% of survey respondents expect to see an increase in commercial and legal disputes in the next 12 months.* 93% of the in-house counsel surveyed expected to have their organisation’s disputes resolved by a negotiated settlement such as mediation, as opposed to determination in Court.* Just over half of the in-house counsel surveyed (53%) indicated that the number of hours they work per week have increased over the last 12 months. However, only two in five respondents (41%) attribute the greater demand for their services to the volatile times.* Fifty percent of in-house counsel expected that their legal budgets will remain unchanged over the next 12 months. 25% expected an increase and 25% a decrease. Polarised views were also held within industries.* Consistent with the pressure to reduce overheads and expenses, fewer legal departments expected to employ new staff in 2009. Sixty three per cent of respondents have hired additional in-house lawyers in the past 12 months, but in the next 12 months only 40% expect to be hiring.