The year 2013 was not the easiest time to be working in the legal department at Archer Daniels Midland Company, one of the world's largest agricultural processors and food ingredient providers.

Not only was the mood in the department dampened by an ongoing Foreign Corrupt Practices Act investigation, there also were more systemic issues at work. The department was in many ways operating in its own silo and, although almost 85 percent of ADM's legal spend went to outside counsel, no one had a full picture of which firms were being used or how fee determinations were being made.

Enter Cameron Findlay, Chicago-based ADM's senior vice president, general counsel and secretary, who joined the team in July 2013. Findlay and a group of intrepid in-house colleagues succeeded in taking a legal department that likely would have looked more at home decades in the past and turning it into a cutting-edge operation worthy of Corporate Counsel's Best Legal Departments honors for 2018.

But at a company as massive as ADM, which has 30,000 employees and a presence in more than 170 countries, change doesn't happen in one fell swoop. Instead, it's hard-earned and complicated. It happens piece by piece, step by step.

“I think our spirit is, don't try to fix everything all at once, let's have a spirit of continuous improvement here,” says Findlay, who leads a department of 74 lawyers worldwide. “We'll fix what we can and then move on to the next thing and then, day by day, year by year, we'll get better as we check things off our list.”

Cynthia Ervin, associate general counsel, corporate services and M&A, has been working in ADM's legal department for over 11 years. She recalls that, before new management, many in-house lawyers basically operated as generalists and dealt with legal issues flagged for them on an ad hoc basis without communicating much with one another. “I could be working on the same thing a colleague next door was working on, and you would never know it,” she remembers.

Often, Findlay says, the business units would hire their own outside lawyers, skipping right over the legal department and thereby missing many opportunities to leverage in-house expertise. Or, when an in-house counsel did get wind of a legal matter, he or she would just pick up the phone and call their outside counsel of choice, without negotiating rates or looking for another in-house lawyer who could handle the matter. And some in-house lawyers were hard to even find, because they were hidden away outside of Legal.

“I said, OK, let's make sure that we don't hire outside law firms without at least asking in-house lawyers if the in-house lawyer knows the answer to the question and can handle the matter,” Findlay says. “Let's make sure that all of the lawyers in the company are all part of Legal and they're not hidden someplace in procurement or other departments. Let's put some controls in place when we hire law firms.”

His first new rule was simple: The legal department had to authorize all outside counsel spend. This was a start, Findlay says, but he knew he could get a lot more visibility into the black box of the company's legal spend—with a little help.

Findlay needed someone on his team who knew technology and operations. He called on a colleague from his days working as GC at Aon, David Cambria, who now serves as director of global operations, law, compliance and government affairs, at ADM, and is still a one-man ops department today.

“The first thing we did was, honestly, I spent a good portion of the time trying to even understand where all the spend was,” says Cambria, who started at the company in late 2013.
As one of his first orders of business, Cambria went to accounts payable and asked for all of the company's vendor information. Since the law firms were not separated out at the time from other vendors, he manually sifted through the records and picked out the firms himself. He concluded that ADM was using over 700 outside firms.

The law department engaged in a massive convergence program that whittled this slate of 700 firms to about 200 by 2014 and then finally down to a panel of around 23 that take care of the vast majority of ADM's legal work today (although ADM uses other firms as needed). The creation of the ADM Law Firm Alliance (ALFA) was complex, and it was achieved in no small part through the power of technology—including a major upgrade to the company's matter-management system, which provided sorely-needed data to help make better spend decisions.

“We looked at things like geographic reach, the capability of the firm,” Cambria says. “We looked at both specialty areas that were very unique to our business and said, 'Who can provide the best services in that regard? Is it always the biggest firm?'”

Narrowing the number of firms also meant that ADM was better able to leverage tools it hadn't really used before—rate discounts and alternative fee arrangements.

The savings from ALFA, combined with insourcing, have been major. Between 2013 and 2017 legal spend at the company has been cut by at least 50 percent. The price of the average billable hour for outside attorneys used by ADM dropped 21 percent in the same period.

Change hasn't always been easy. Cambria says there was some resistance within the company. “I will say that, for some of these things, what we were proposing felt very much like unnatural acts,” Cambria remembers.

But, especially after seeing how the numbers improved dramatically, the legal department and the business at ADM have totally bought in, the company's attorneys say.

The new way of working has certainly resonated with Thuy Vo, chief counsel for corporate, securities and mergers and acquisions, in her work on deals. “I think we coordinate much more deeply and much more effectively between the outside lawyers and the internal legal department,” she says.

Another key aspect of the department revamp was aligning its operations more closely with the business. Lawyers who were once siloed have become integrated into the company and assigned to specific business units and geographies.

Michael Kaye, associate general counsel, is one of the lawyers situated in a business unit, in his case, the Ag Services group, which oversees ADM's global grain purchasing and storage, and its transportation assets, among other areas.

Kaye likens himself to a family practitioner in medicine, with the family, in this case, being Ag Services. “We see everything that comes into the business unit. We talk to the business folks day in and day out,” he says.

Brendan Gardiner, chief litigation and regulatory counsel at ADM, has found that the department's move to align itself more closely with the business and with areas like HR, communications and regulatory has led in-house lawyers to “occupy more space” within ADM—in a very good way. The business, he says, now comes to Legal to get solutions for problems, rather than simply showing up with “legal questions looking for legal answers.”

“If you ask me, that's the value of an in-house lawyer,” he says. “If you can't do that, you're really not doing your job as an in-house legal department, because pure legal advice—you can get that on the outside.”

ADM's legal function has come a long way, but Findlay and his colleagues see department improvements as an ongoing project. In 2017, the company got to work expanding its ALFA program beyond North America  and is gunning for 25 percent AFA use overall in its legal work.

And in a big display of faith in the law department's capabilities, ADM last year brought its captive insurance company, Agrinational, under the legal function, a cash-saving move that increased client satisfaction.

Says Findlay: “There's still a lot to do and there will always be a lot to do in a place like this.”