Up to 700 companies, public authorities and charities could currently be considering the business case for applying to become an Alternative Business Structure (ABS) according to a report commissioned by the Solicitors Regulation Authority (SRA) on the in-house market.
Published yesterday (4 February), the report, simply called ‘the role of in-house solicitors’, surveyed over 2,000 in-house solicitors as well as 213 representatives from organisations employing in-house solicitors. It found that 5-10% of those surveyed have some appetite to become an ABS and concluded that ‘applying this proportion to the total number of firms known to employ in-house solicitors, would suggest that somewhere between 300 and 700 firms are considering applying to become an ABS.’
The research also revealed that awareness of ABSs among survey participants was high, with close to 90% of respondents reporting that they were ‘fully aware’, or ‘aware about the legal change, but not the details.’
Of particular relevance is the sometimes overlooked ‘third sector’, which includes advice centres, not-for-profit organisations and co-operatives, where three of the 16 respondents reported that they are considering the business case of applying for ABS status. ‘Therefore, change in the third sector could be significant. Many third sector organisations can be expected to be awaiting further details from the SRA on the tailored ABS regime for ‘Special Bodies’ before considering the business case for ABS,’ the report by Oxera Consulting found.
In more general terms, the report charts the growth and rise in stature of the in-house legal profession, with 25,600 solicitors now working in-house, twice the number compared to nearly 14 years ago and 18% of the total solicitor population.
SRA executive director Richard Collins said: ‘The in-house sector continues to thrive, grow and develop and it is important to ensure that regulation in this sector remains relevant, effective and proportionate.
‘Many in-house solicitors are in a role that also involves providing advice to third parties outside of their organisation, and potentially linked to that, it would seem that there is an appetite among some organisations to convert to an ABS.’