How does your department measure up? ACC can tell you
The Association of Corporate Counsel (ACC) periodically takes the pulse of its members, surveying everything from headcount to spending to workload. It’s released the newest benchmarking survey, conducted with the recruiting firm Major Africa, and skimming the results, we see some interesting metrics.
First of all, most of the 508 responding departments are small, and decidedly not the huge mega-departments that rival private law firms. Nearly 46 percent have two to nine lawyers on staff; only 8.8 percent have 100 or more. In fact, 78 percent of the departments surveyed have 24 or fewer lawyers. Does company size matter? It depends. Overall, companies have 8.7 lawyers per $1 billion in revenue. But that number depends on the industry, with services pulling out way ahead with 15 lawyers per $1 billion.
How much does a company spend on legal? Overall cost is $90 per lawyer hour. The mean budget is
$12.3 million, while the median—the midpoint, in case you’ve forgotten everything from your statistics class—is $1.6 million, meaning that there are a lot of big spendings on one side of that midpoint, bringing the average up. And in case you’re wondering, the average, er, mean inside legal spend is $7.6 million, which represents a total of 52 percent of the department’s outlays.
It’s not exactly news that outside counsel is expensive. But it’s always good to see what the other person spends. In this case, the mean outside firms payout is $9.7 million, again, with lots of big spenders tipping the balance because the median is only $845,000.
Speaking of outside counsel spending, how are those fees structured? Brace yourself: Most spending is on an hourly basis, with 70 percent of those reporting getting discounts. 68 percent of those reporting pay normal hourly rates. Do departments hold back for meh performance? Not a lot—only 2.2 percent.
You can download a summary of the report here. And ACC would be happy to sell you more complete data.