Marks & Spencer is to launch a full-scale review of its legal function – including its use of external law firms – as part of a shake-up of head office functions.
Apart from possible job cuts, the review could also result in less work for some of the firms most regularly used, including Freshfields (main corporate lawyers), Linklaters, SJ Berwin, Denton Hall, and Cartwrights.
“Every head office department is being looked at, although we don't actually know how the review will affect the legal department yet,” says a spokeswoman.
Graham Oakley, company secretary and group legal adviser, is heading the department review.
While unable to comment yet on whether jobs and external work would be cut, he says: “It would be unlikely that the demand for legal services will diminish. We have already achieved cost-effectiveness by having much of our legal work done in-house.”
Marks & Spencer's top-to-bottom review started last week with the operational side of the business, namely the buying and store development functions. These account for half of the 3,700 staff at the head office in London's Baker Street.
Some 200 jobs will be lost from these two functions. After that, the review will switch in earnest to the service side of the business.
“What might change is the company's operational structure, so we have to see how best we can adapt the legal function to meet the client's needs,” says Oakley.
Peter Salisbury, the chief executive appointed after a tough succession battle last year, introduced the wide-ranging review after the huge collapse in last year's profits. Three board directors and 28 senior executives have gone already.
Marks & Spencer's in-house legal function, with eight lawyers and eight support staff, is small in com- parison to other FTSE100 companies.
It handles three-quarters of UK legal work in-house, and about 5 per cent of the global work, involving some 30 jurisdictions.