The Stark Divide Driving Profit or Stranglehold for Law Firms

It’s a stark dichotomy.

Corporate counsel today find themselves in one of two camps: either seizing strategic opportunities to change the business – or focusing on improving compliance and warding off risk.

Either camp creates one of the most compelling business development opportunities for law firms – fueling new growth and ever more mouthwatering rates.

A third wing are trying to sort out the personal issues presented by these two challenges – giving law firms another avenue into higher rates and more enduring relationships.

Our latest survey of more than 350 corporate counsel outlines the divide like this:

Where Market Busting Rates are Found

Corporate transformation is risky stuff.

It’s nearly impossible to reinvent a company without encountering complex, hidden, and obvious legal challenges. At the same time, transformation often depends on leveraging legal loopholes and creative interpretations.

Fully 64% of corporate counsel cite pressure to accelerate corporate transformations as the most compelling issue to solve. This is the camp seizing the strategic opportunities.

They are being asked to serve as legal sherpas – navigating often unexplored legal terrain to get to the prized business outcome. This landscape includes:

• Tapping into new technologies without making direct acquisition
• Crafting strategies to sidestep perceived regulatory obstacles
• Deconflicting opposing regulations in different jurisdictions
• Structuring carveouts and spinoffs to gain skeptical regulator approval in deals
• Knowing how to close deals in today’s volatile environment
• Managing IP rights, protections, and usage – especially in connection with Generative AI
• Defending against new mass tort litigation around social media, climate change, food formulations, and a host of new similar trends
• Negotiating flexible but advantageous terms for technology collaborations
• Anticipating and avoiding emergent waves of litigation

Demand for these high-stakes legal strategies is growing – and will only continue to expand. Law firms are in the perfect position to help clients craft these strategies. The key is to be in dialogue with clients.

A few forward-thinking law firms are already bringing in MBAs and other business professionals to help develop new and alternative strategies.

Urgent Need for Managing the Unknown

Uncertainty is the only certainty. Corporate counsel have no choice but to manage it.

24% speak to unknown risks as their most pressing challenge. They point to an unending stream of the unknowable including:

• Shifting compliance standards
• Evolving regulatory standards
• Unforeseen litigation for novel claims – especially mass torts (see above)
• Unintended outcomes from using Generative AI
• Surprise supply chain disruption
• Tariff impact and strategy

Attorneys can help by:

• Bringing clarity and calm – help clients assess, prioritize, and mitigate risk
• Offering strategic foresight – anticipate risks before they become crises
• Leveraging legal intelligence tools – such as risk trackers to personalize discussions

The Personal Factor

Forget the law – 12% of in-house counsel single out deeply personal issues as their central concern.

These needs demand attorneys bring listening skills and empathy. They also demand bringing help – in the form of providing advice, connecting clients to others who can bring perspective, tools to simplify client life, and performing favors outside the context of matters. The most valued list includes:

• Dealing with stunning workloads
• Responding to relentless management pressure
• Socializing new legal strategies internally
• Working through management bottlenecks
• Adjusting to abrupt corporate shift in risk tolerance
• Defining career paths

Few things beat the power of helping clients with personal wins and advancement. Your deep understanding and role in client success seal your place as a go-to advisor in any situation – always at record-setting rates.

What To Do Now

Transformative technology plus geopolitical volatility create peak chaos.

Opportunities arise out of utter chaos. As do ever-higher rates. The confluence of factors we see today rarely come together – creating an abundance of opportunity.

As we discussed in our January 30^th post – 67.8% of law firms are pausing their strategies to see how things turn out. The 29.5% who are bold and confident and see change and regulatory volatility as fundamentally good for business are already ahead of the game.

Act now – before things inevitably calm down.