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Legal Counsel

An individual or organization that offers advisory services that deal with matters such as legal issues involving negotiations

What is a Legal Counsel?

Legal counsel is an individual or organization that offers advisory services that deal with various matters, particularly legal issues involving negotiations. The title “legal counsel” is also interchangeably used with the title of “lawyer.”

 

Legal Counsel

 

Legal Counsel – What it Means in North America

In North America, legal counsel refers to a practitioner of law who is allowed to practice in all courts of law. It is why the term is used interchangeably with the title of lawyer.

Formally, a legal counsel is an individual who is hired by a large or mid-sized corporation to handle legal matters and disputes. Such “counselors” are lawyers by profession and educational background but take the title of “legal counsel” due to their employment with, and role within, certain firms.

In other countries, such as the UK, the term legal counsel was used as a substitute for barristers, but is now obsolete and only used in the context of individuals who work in the legal department of corporations.

 

Lawyer vs. Legal Counselor

The primary, and only, difference between a lawyer and a legal counselor is that a lawyer may have his/her own firm or may work independently as an advocate. On the other hand, a legal counsel is employed by a firm to handle all the legal matters and disputes that the firm may encounter and does not work independently – unlike lawyers.

Therefore, while lawyers are paid by their clients based on factors such as the hours worked and the outcome of the case, legal counselors are salaried employees who tend to receive additional incentives and bonuses associated with successful outcomes from negotiations and legal disputes.

 

Legal Counsel – Functions in Business

A legal counselor handles all law-related matters that a company encounters, including:

  • Conducting research on different laws and regulations in various geographic and political environments
  • Drafting legal documents as required by the company, based on situations and clients
  • Negotiating settlement terms with individuals of interest
  • Handling legal disputes with other corporations and/or individuals
  • Documenting and filing taxes according to different systems of taxation
  • Documenting and filing documents related to Intellectual Property
  • Managing legal risk

 

Why Legal Counselors?

Lawyers often tend to specialize in a single area of practice – such as intellectual property, real estate, bankruptcy, immigration, negotiation, and so on. Therefore, companies that do not employ in-house legal counselors must pursue different individual lawyers for different types of legal matters.

On the other hand, a legal counselor functions as a general lawyer who handles all the legal matters in a company – reducing the costs of recruitment and the need for multiple individual lawyers. Legal counselors can be especially beneficial for companies that tend to come across legal matters and disputes regularly.

 

Related Readings

CFI offers the Certified Banking & Credit Analyst (CBCA)™ certification program for those looking to take their careers to the next level. To keep learning and advancing your career, the following resources will be helpful:

  • Lawyer Salary Guide
  • Corporate Structure
  • Paralegal Salary Guide
  • Probate

FMVA certification program

Advance your career in investment banking, private equity, FP&A, treasury, corporate development and other areas of corporate finance.

Get certified as a financial analyst with CFI’s FMVA® Program.