Spending controlled some by the law department, but dominated by company and industry

Total legal spending relative to revenue declines as companies grow larger (See my posts of April 5 and Sept. 10, 2005 that propose several reasons; but also my post of July 5, 2006 that discusses some contrary arguments, including being deep pockets and innovators of business practices.).

Other reasons come to mind for the decline in total spend. Larger companies might be more measured in the risks they take, more careful to follow sound procedures, more inclined to spot and sidestep legal blunders. Perhaps big companies make fewer legal mistakes, the best brake on legal costs.

In larger perspective, in some industries an oligopoly of large companies may have matured to where there are accepted standards of competition and the rough edges of the law have been smoothed out. Fledgling industries, or ones full of scrabbling competitors, may be bumpy with new and costly legal issues. Both the corporate view and the industry view might explain some of the size-related decline in total legal spending.

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