Many in-house counsel don’t see eye to eye with businesses on obligations to uphold rule of law

A new study has found that for about a quarter of in-house counsel, there’s a disconnect between them and their organisations when it comes to upholding the rule of law.

LOD: Lawyers On Demand found in its “Which way is the wind blowing? Recalibrating the moral compass of in-house legal practice” report that 26% of in-house lawyers agree that there are tensions between the way they and their businesses respect obligations to uphold the rule of law.

For the report, the latest in the NewLaw firm’s “In Collaboration series,” Steven Vaughan, professor of law and professional ethics at University College London, and Richard Moorhead, professor of law and head of Exeter Law School, spent five years surveying 400 in-house lawyers and conducting 67 in-depth interviews. LOD said that the study is “the largest-ever study of in-house lawyers anywhere in the world.”

The findings come as roughly a fifth of solicitors in England and Wales, as well as in and Australia, are in in-house roles. The proportion is even higher in New Zealand, and growing rapidly, Vaughan and Moorhead wrote.

The professors also said that in-house lawyers are increasingly well-paid, have high status, and have significant influence, being integral parts of the decision-making process of their organisations.

The study also found that 32% of in-house lawyers agree that they are sometimes asked to advise on a matter that makes them ethically uncomfortable. It also found that 39% have been asked, with varying regularity, to advise on matters where the legality of a an organisational action being considered is debatable. The researchers also said that 45% of in-house lawyers have been asked, with varying regularity, to advise on something where the ethicality of the proposed action by the organisation is debatable.

The study also found that a majority (80%) of in-house lawyers say that in-house teams, which have previously been found to being increasingly “squeezed,” were criticised for impeding commercial decisions. Just over half of respondents said colleagues are sometimes reluctant to raise issues with legal departments.

“The role of the in-house lawyer in the business world of today has never been as important and the role of ethics is fundamental to commerce. This report isn’t saying in-house lawyers need to be un-commercial or allergic to risk, but instead highlights the tensions of being perceived a ‘problem solver’ whilst upholding high ethical standards and even the rule of law,” said Paul Cowling, LOD Australia managing director.