What are the issues, challenges and information governance considerations that firms should be aware of in relation to matter mobility? Chris Giles surveys an evolving landscape.
Matter mobility is a component of information governance that is now of growing concern to law firms, simply because it’s becoming more and more common for both lawyers and clients to move firm. Accordingly, firms are well advised to direct some concerted effort to ensuring that as part of their information governance programme, they reduce the risks of matter mobility management and minimise its unhelpful effects on productivity and client service levels. But first, your firm needs to be clear about the inherent hazards of matter mobility and the attendant negative impacts.
Broadly speaking, there are two types of risk: compliance and operational. Compliance risks are incurred if the firm either breaches regulatory or client rules. In Europe, the legislation to be aware of includes Anti-Money Laundering (when on-boarding new clients) and the various national implementations of the EU’s General Data Protection Regulation. These cover how personal data is secured and handled. In relation to matter mobility, firms can breach the requirements if, for example, they retain copies of matter material that includes personally identifiable information after a client is no longer with the firm. There’s also a compliance risk if an onboarding firm has ingested records only for the supposed new client to change its mind about moving, at which point electronic data must be destroyed and physical material returned.
In addition, firms must be careful not to breach client Terms of Engagement or Outside Counsel Guidelines that may stipulate how matter material is secured and include provisions on material retention and transfer. On that note, and for data security compliance, careful attention should be paid to data encryption when electronic material is transferred to avoid potentially disastrous cybersecurity breaches. It’s also possible that OCGs can conflict a firm out of accepting a new client.
The second category of risk that firms face in relation to matter mobility can be understood as operational risk, or put another way: the negative impact on business as usual.
On receipt of a transfer authorisation, all of a defecting client’s materials must be identified, located, gathered and thereafter screened by individuals who are sufficiently senior that they can take a well-informed view as to what content needs to be culled. This will include everything relating to the business relationship between the firm and the departing client, plus internal emails about the client and anything else that could compromise or embarrass the firm. They must also remove any content that could be used as evidence if the firm is subsequently sued by its former client. Clearly the opportunity cost to the firm of this activity is considerable: while partners and senior lawyers are occupied on this unbillable work, they’re not able to earn any fees. To minimise the negative impact, firms need to carefully manage this aspect of offboarding.
Meanwhile, onboarding firms must have processes for accepting new clients in principle before they start ingesting newly received matter material. They also need processes that control and streamline how newly accepted client data is ingested, including for identifying where potentially large volumes of physical and electronic data should go, and for allocating new matter numbers, bearing in mind that inbound material is often poorly organised, and in a range of formats. Otherwise, the risk is that delays and fumbles give new clients a bad first impression, while at the same time the onboarding firm can neither service nor bill its new client, impacting revenue.
It’s clear that matter mobility management has become an increasingly important part of law firm information governance and no matter the size of the firm, they should be making proportionate efforts to minimise the risks and disruptions.
To that end, firms need to assess the impacts across their business, from records management, to risk and compliance, to ICT and to lawyers. Then they must institute appropriate governance measures, including policies, processes, procedures and controls; identify the systems that support these and optimise opportunities for automation. Best practice will likely include workflow wrappers and systems that manage processes and authorisations smoothly, as well as make it as easy as possible for senior lawyers to review material. Increased matter mobility is a fact of life, so law firm information governance policy and practice must adapt accordingly.
To find out more join us for an ILTA Product Briefing, ‘How to make client transfers a key competence’, where we will discuss the technology that can support firms to efficiently manage the challenge (and opportunity!) of matter mobility. We will show you how iCompli, from LegalRM can streamline the process of data transfer accurately, whilst reducing risk and improving client service.
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