About

Team size: 840
Major law firms used: Addleshaw Goddard, Allen & Overy, Baker McKenzie, Clifford Chance, Dentons, Linklaters, Pinsent Masons, Simmons & Simmons, White & Case

‘You don’t want a brain surgeon clipping your toenails, but you don’t want the foot doctor doing brain surgery either,’ Barclays group general counsel Bob Hoyt says of his legal function’s philosophy. ‘You get the right level of professional on the matter for a very good, competitive price. That’s the best we can do for the bank.’

The banking giant completed its final panel review in July 2018 ahead of a long-planned phasing out of formal reviews by 2021. As recently as 2012, Barclays had more than 1,000 external advisers worldwide, but that has shrunk to around 100 today, with the new model touted as replacing resource-intensive adviser reviews with an ongoing relationship management system.

Hoyt, who joined Barclays in 2013, says the function’s role is at its most basic about managing all of Barclays’ legal affairs. The team has grown to 840 internally, but the bank recently started tracking how many FTEs it effectively employs externally each year: a further 1,900. Hoyt views the overarching group as Barclays’ interchangeable legal workforce, while claiming the company’s legal bills have come down ‘very significantly’ in recent years. Savings generated are believed to run into the tens of millions of pounds.

‘We had the idea of finding out how many professionals around the world bill time to Barclays for legal matters,’ Hoyt comments. ‘I was surprised at how low the FTE workforce number was, but it’s an interesting number to play with and ask how you can manage that to be the most efficient workforce you can get.’

Hoyt says it is not all about reducing that FTE number, however, although the conclusion of legacy litigation matters, such as the Serious Fraud Office investigation into the bank’s £12bn fundraising at the height of the financial crisis, have inevitably helped bring it down. He says the demand for legal services is not within its control and not always bad – M&A activity or entering a new jurisdiction, for instance – and so his focus is on what he can control: how efficiently that is delivered.

‘If we get sued I don’t have an option to not defend the case. But how am I defending it? Am I using the right firm with the right qualifications? Am I using one firm or three firms? What’s the budget? How tightly are we managing it? How do I get the right result with the right professionals on the matter at the least possible cost?’

He admits the radical overhaul of working arrangements with dozens of major law firms has not been a comfortable journey for everybody, conceding the bank has not always got it right as well. Transparency and listening to law firm feedback have been two of the biggest lessons. The bank has also created a working group with its firms to improve the use of effective fee arrangements over hourly rates, while also looking at how long it takes the bank to pay its bills.

‘I am agnostic as to whether the work is done by a professional employed by Barclays versus somebody employed outside of Barclays. If something can be done at an equal level of quality but cheaper externally, then that’s where it’s to be done. That is why, even though our total legal cost has decreased year on year for the last five years, our internal headcount has increased.’