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A method to quantify co-location of in-house lawyers, and thus their value to the company

Let me propose a metric to show a law department’s value, based on the degree to which its lawyers are based in countries in proportion to the revenue from that country. In that regard, during the past two years, this blog has commented on several law departments with many locations of their lawyers (See my post of Jan. 12, 2012: P&G with 20 sites; March 28, 2011: Google with 21 and AB InBev with more than 20; and June 8, 2011: Wellpoint with 28 locations.).

The blog has skirted the quantification I am here proposing (See my post of Nov. 20, 2007: global law department if it has 10+ locations outside HQ country; Dec. 31, 2010: the “nerve center” where many specialist lawyers have offices; Feb. 28, 2012: attorney-client privilege headaches of multiple foreign offices; Oct. 17, 2011: dispersed lawyers characteristic of concentrated global industries; and Nov. 24, 2011: law departments of non-U.S. companies are more likely to be geographically dispersed.).

We could measure proximity of counsel to corporate revenue. If the proportion of a company’s revenue that comes from a country (or a region) matches the proportion of its in-house attorneys based in that country or region, the metric would be 1. To the degree that lawyers don’t follow the money, that number will decline (See my post of April 16, 2012: locate lawyers where revenue, and thus legal work, is generated.). For example, if 10 countries each account for 10% of a company’s earnings, but all its in-house lawyers are in one of those countries, the metric would be 0.1.

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