L’une des tâches principales des juristes et des services juridiques est de toujours rester au fait des changements dans le droit pour bien les intégrer dans les activités de l’entreprise. Or c’est une tâche qui paraît souvent désorganisée, chronophage et compliquée. Dans ce billet, nous aborderons les pratiques exemplaires pour surveiller l’évolution du droit, évaluer l’effet des changements, établir la manière d’y répondre et veiller à leur intégration dans vos méthodes de travail et celles de vos clients.
Une traduction de ce billet sera disponible prochainement.
Staying ahead of new legal developments and incorporating them into your operations is a key function for lawyers and legal departments. However, the process of doing so usually feels disorganized, time consuming and difficult. In this post we look at best practices for monitoring legal developments, assessing their impact, having plans to address them, and ensuring that they become part of the way you and your clients work.
A Legal Change Methodology
A component of change management, risk and compliance in any organization is identifying changes in legal requirements and ensuring that the policies, practices and procedures in the organization are updated to keep pace with those legal changes. Over the past year, we published on our website information regarding almost 100 new legal developments ranging from regulatory guidance and proposed legislation, such as CSA guidance on various matters, to landmark cases and significant legislation such as the new CBCA requirements regarding Registers for Individuals with Significant Control. It is important to have a methodology to address both small and large legal changes. The process we have developed at the firm covers the four main steps described below and we have suggested how to adapt the process for in-house legal departments.
Tracking Legal Developments to Get in Front of Changes
Monitoring new legal developments and identifying those that matter is not an easy task. To start, the volume of information is overwhelming as it covers legislative and regulatory changes, new case law and practice point developments. Second, there is no single source of information, so it must be aggregated from a wide range of data sources. Finally, it requires human expertise to sift through the raw data and identify developments that will impact you and your clients.
The multi-prong approach we use at Stikeman Elliott is probably similar to the approach used in many organizations and requires both third party content subscriptions plus human resources. Information is sourced from several information providers and is combined with our own research. We have tried various third-party aggregators and tools to deliver information to our lawyers, but they have fallen short of expectations.
The two primary channels that we use to effectively deliver information to lawyers are:
- Alerts using external resources on various topics, including specific legislation, case law, industries and clients;
- Curated newsletters for certain practice areas that are created by the library and lawyers in the KM team.
What you can do if you are an in-house team:
- From an information source perspective, many legal teams rely on updates from their external counsel, resources such as Lexology, Mondaq and Canlii, and information from applicable regulators.
- From an aggregation perspective, we have assisted some clients with setting up Protopages and we have heard of others using tailored Flipboards.
- From a tracking perspective, we have a client that uses a custom regulatory matrix designed for their industry and organizational structure. Responsibility for parts of the regulatory matrix is assigned to different members of the legal team, and as changes in law or developments are identified, they are tracked in excel.
Assessing the Impact of a Legal Change
The first step in assessing the impact is to separate legal developments that will have an impact on your legal team and your business clients from all of the information you are tracking. At the firm we rely on lawyers in the KM team, practicing lawyers and client feedback on critical areas of interest to flag those developments - tapping into both experts who can easily appreciate the implications of changes in their area of expertise as well as generalists who may see broader implications to the developments. For in-house legal teams the assessment may require involvement from both lawyers on the legal team and your business clients as well as external counsel’s perspectives.
Once a new legal development has been flagged it typically falls within one of the following categories which work well for law firms and law departments alike:
- Watching Brief: the development is in its initial stages and is likely to change;
- Good to Know: the development is of note but will not have a significant impact on the organization or its business;
- Need to Know: the development will have an immediate or significant impact on the legal department or its business clients;
- Need to Act: the development will require the organization to take some action in order to comply.
The final step in assessing the impact is to analyze and interpret the new law, case decision, practice development, etc. Again, there is a spectrum of effort that may be needed ranging from review by one lawyer with expertise through to complex interpretive work involving multiple lawyers, background research and discussion groups. For example, the changes to the CBCA in 2019 introducing the Register of Individuals with Significant Control fell into the complex change category due to the impact on clients, the nuances of the legislation and the desire for consistency in approach within the industry.
Communicating and Educating on a Legal Change
As noted above, because it is important to have a methodology for addressing legal changes, we have a checklist of activities that we use which will vary depending on the type of change. We have adapted our checklist for a legal department:
- Legal Analysis: who will lead the legal analysis and who needs to be involved? Considerations include the practice areas impacted, jurisdictions impacted and ensuring consistency of approach. Contrast municipal law changes which have local impact and can be assessed by experts in one jurisdiction with securities law changes which can have broad jurisdictional and industry implications requiring input from a range of experts.
- Internal Briefing Materials: what materials are needed to brief your lawyers on the change and its impact on their practices and the business? Options include practice notes, briefing memoranda or emails.
- Internal Communication: who needs to know about the change and from whom? For example, the CBCA ISC Register changes warranted several communications across the firm to all lawyers and paralegals.
- Internal Education: what form of interactive education is necessary? Considerations include the lawyers impacted and options range from practice area and department meeting discussions, to broader seminars and workshops, to e-learning modules. We find that most changes are best covered at standing practice group meetings unless the change affects a broad client base.
- Business Client Communication: what type of business client communication would be appropriate? Considerations include the most effective communication channels that you have with your business clients, who needs to know, and how many touch-points you need. We may prepare a post for the website or a targeted client email communication or a combination of the two. You may be able to leverage communications from your external counsel for this purpose.
- Business Client Education: would your business clients benefit from an e-learning module or an education session that would enable them to interact with legal subject matter experts and other members of the business? Again, outside counsel may have useful offerings for you.
- Technology: use of technology can start when you are addressing the legal change. For example, an A.I. contract analysis tool could be employed to identify contracts affected by a regulatory change. This would enable the business and the legal department to determine the extent to which the legal change will impact the organization. Data analytics could also be deployed in a similar fashion.
Going back to the types of changes identified above, we may do none of the things noted above, or all of them. In the case of a change that is “Need to Know” or “Need to Act”, the checklist is transformed into a project plan.
Operationalizing a Legal Change
The extent to which you need to operationalize a legal change will depend on its impact on the day to day operations of your organization. Some of the activities that we consider are:
- Processes and Procedures: if there are documented or undocumented processes and procedures that could be impacted by the change, process maps and checklists will need to be evaluated and updated accordingly, or perhaps created. The CBCA ISC Register changes, for example, required us to map and implement new processes and procedures for our corporate services team.
- Policies: policies should be assessed to identify any potential changes as a result of the legal development. Many organizations in Canada have updated or adopted new policies in connection with the legalization of medical and recreational cannabis.
- Precedents: precedents and other legal resources may need to be created or updated. We find that it is critical to have these key resources prepared and ready for use when the change comes into effect to ensure that lawyers and business personnel have the tools they need to support them as they adapt to the change. For example, a number of our securities precedents were recently updated to incorporate the new CBCA diversity disclosure requirements. Any content that is rendered out of date should have appropriate warnings added or be removed from use.
- Learning and Development: while education is a consideration in connection with the immediate change, it should also be addressed as part of onboarding and ongoing learning and development. Ongoing education programs may need to be added, modified or discontinued to incorporate or account for the new state of the law.
- Technology: Finally, technology. It has a role to play both in communicating the change (as described above) as well as operationalizing the legal development. When operationalizing a new development, existing technology systems may need to be updated to support the adoption of the change. Additionally, applications using legal technology can be created to address new challenges arising from the change such as Stikeman Elliott’s Diversity Survey tool which enables corporations to respond to the new CBCA diversity disclosure requirements in a confidential and secure way.
For changes that fall within the “Need to Know” or “Need to Act” category, it is likely that at least one or more operational impacts noted above will need to be addressed.
There is No Magic Bullet
Currently, there is no magic bullet for monitoring, assessing, addressing and operationalizing new legal developments. Hopefully the future holds promise for improving the way in which legal developments are surfaced and distributed to those who need to know. However, a tailored human approach is still needed to ensure that legal developments and changes which impact your organization and business clients are identified, communicated and incorporated into your practices and procedures. The highest value a legal team can bring in operationalizing new legal developments is addressing the change in a way that makes sense for your organization while supporting seamless risk management and compliance.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.