We cannot time-travel to see future changes in the world, certain new tools offer insights that might feel like time travel. These tools can improve data management, security, and compliance.
Let’s pull back the uncertainty about the future and keep your legal entities on the same page.
Explore some of the challenges and opportunities that 2024 offers legal entity management.
Key Takeaways:
- Legal entity management will help you keep your operations running efficiently.
- Advanced technology is improving how you operate and opening doors to globalization.
- Use automation and legal entity management software to stay on top of the latest data privacy changes and laws.
Legal Entity Management Goals
Legal entity management (LEM) ensures effective oversight and control over your organization’s legal entities. Whether you work with corporations, partnerships, or limited liability companies, these entities are separate from their owners or shareholders.
Key responsibilities typically include:
- Maintaining corporate records
- Ensuring regulatory compliance
- Managing governance structures
- Supporting effective communication between entities and stakeholders
The ultimate goal of your legal entity management is to ensure seamless and legally compliant legal operations and to meet stakeholder obligations.
Legal Entity Management Challenges
While your legal operations goals may resemble previous years, you will find several new challenges. Here’s a look at some of the top challenges you may face this year.
Complex Regulations
Regulation requirements are becoming increasingly more complex due to globalization and increased data usage.
Some of the changes include regulations around:
- Data privacy
- Data governance
- Industry-specific mandates
Navigating these complexities is very important, as non-compliance carries costly financial risks.
Data Privacy Issues
With advancements in AI, data privacy and security remain a key concern this year.
Legal entity management must prioritize the protection of data exchanged between entities, tracking behaviors, and the encryption of sensitive information.
Technological Changes
Artificial intelligence, blockchain, and cloud computing advancements offer capabilities to streamline processes and drive innovation. Integrating these technologies requires careful planning to maintain data integrity and a workforce adept at handling the new tech.
Talent Shortages
Many organizations face talent shortages and skill gaps in critical areas such as regulatory compliance, data analytics, and cybersecurity.
In 2024, 75% of employers said they had difficulty filling roles. Data and IT skills are the most difficult to find and hire.
Image from the Manpower Group
5 Advantageous Changes in Legal Entity Management in 2024
While new challenges are arising this year, new opportunities also exist. Jump on board five new opportunities to help your legal team thrive this year.
1. Foster Consistent Regulatory Compliance
Consistency is critical to staying on top of changes, supporting globalization, and avoiding costly privacy errors.
Leveraging new technology and automation, you can create workflows that comply with data governance laws. This reduces errors and simplifies adjustments when regulations evolve.
Outsourcing your legal entity management can further cement this consistency, offering dedicated teams and tools for compliance.
2. Enhance Transparency and Accountability
Transparency and accountability remain another top priority in 2024. It’s not just about stakeholder relations but how the entire business operates and shares data.
A significant 65.8% of consumers say a company’s transparency around data usage is the number one impacting factor as to whether they trust a company. As you collect, manage, and share data, be transparent about what you use that data for.
This transparency should extend to all business interactions with investors, regulators, and stakeholders, creating a culture of integrity and responsibility.
Image from Insider Intelligence
3. Leverage Technology for Efficiency
In 2024, legal technology provides innovative ways to enhance efficiency and mitigate risks. These advanced tools and legal entity management software automate routine tasks, streamline regulatory compliance, and centralize corporate data.
Cloud-based solutions, artificial intelligence (AI), and blockchain technology are transforming how legal operations manage and govern legal entities.
Companies are also moving toward integrated entity management systems. These technology give a holistic view of your operations, improving compliance, risk management, and corporate governance. It also allows stakeholders to make informed decisions, monitor performance, and communicate effectively.
4. Prioritize ESG Goals
Environmental, social, and governance (ESG) considerations will shape legal entity management practices in 2024.
With growing awareness around sustainability issues, organizations are adding ESG principles into their corporate strategy and operations.
From carbon footprint reduction to diversity and inclusion initiatives, companies align their business objectives with broader societal goals, improving their reputation and competitiveness.
5. Begin Talent Development Initiatives
Talent development allows you to create talent and opportunities to combat the talent shortage.
You create a talent pipeline through training, advancement opportunities, and employee investment. This system keeps replacements ready if anyone quits, so you only need to fill entry-level positions. You will also see fewer employees leaving as a consistent stream of internal advancement opportunities will be available.
By investing in your talent, you help them understand new technology, regulation changes, and advancements so everyone understands how best to perform legal entity management.
Embrace the Legal Change
Is your legal operations team ready for the changes in legal entity management?
Our legal entity management services help you embrace new technology and processes to stay on top of compliance and technological changes. We also offer comprehensive training and talent support to improve talent retention and future readiness.
Let’s future-proof your business together.
Contact us to learn more about our legal entity management solutions.
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About the Author:
Exigent delivers scale, expertise, and insights that generate bigger returns for CLM – Contract Lifecycle Management, Legal Spend Management, e-Billing, Due Diligence, Document Review, eDiscovery and Litigation Support, Commercial Services, Regulatory & Compliance, Outsourced Legal Administration, and Legal Tech Design.
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