Survey: Legal Spend Up for Companies in New York

Companies in New York indicate that they spend more in legal than companies in other parts of the country, according to the results of a survey published by HBR Consulting.

December 21, 2018 at 03:59 PM

2 minute read

By Dan Clark

Companies in New York spend nearly $10 million more in legal spend than other companies across the country, according to a report published by HBR Consulting.

HBR received responses for the survey from over 250 companies in 20 different industries.

Lauren Chung, managing director at HBR Consulting, said that the reason New York has the highest legal spend is because it is home to a large financial sector.

“A lot of what we find is a concentration of types of companies by region which has an impact on spend,” Chung explained. “In the New York area, a lot of it is financial services companies that make up our participant base.”

She said that regulatory challenges of the financial services industry is one reason that legal departments in New York have increased spending.

“I do think … regulatory challenges facing financial services is growing,” Chung said.

The report indicates that legal spending for financial services companies has gone up 12 percent in 2018. New York companies' spending on outside counsel increased by s7percent and their internal legal spend went up by 6 percent, according to the report.

Fifty percent of the companies from New York indicated that there has been an increase of in-house lawyers. All of the companies from New York indicated that to manage the amount spent on outside counsel, they are keeping more work in-house. Nationwide, only 77 percent of companies indicated that they are keeping work in-house.

Compared to the rest of the country, New York companies are slightly behind in having a dedicated legal operations function, according to the survey. Fifty-six percent of respondents in New York said they have a legal operations function compared with 58 percent of respondents across the rest of the country who said the same.

“We're seeing mixed results there. It is true that law departments that have legal operations functions do a better job managing their spend because they're able to put stricter management programs in place and focus much more on performance management,” Chung explained.