Mining giant Rio Tinto has embarked on an outsourcing project that will see part of its internal and external legal needs outsourced to India.
A dedicated team of 12 lawyers provided by outsourcing company CPA Global will carry out contract review, drafting, legal research and document review work on Rio Tinto’s behalf. It is estimated that the project will generate savings of around 20 per cent out of the company’s legal cost base.
It is expected that the scope of work will be expanded to include regular legal work currently carried out by both the in-house team and by external legal advisers. Rio Tinto’s advisers in the UK include Baker & Mckenzie, Herbert Smith and Linklaters.
Baker & McKenzie competition partner and relationship partner Samantha Mobley said: “We’ve indicated that we’ll embrace this way of working and hope [as a result that] we’ll receive more projects from Rio Tinto than we have done to date. It’s helpful for all of us because it affects the kind of area in which law firms are being pushed for value for money and it makes us more competitive when tendering for projects.”
A spokesman for Linklaters added: “We have been discussing this with Rio Tinto for some time and are supporting them in their initiative to ensure that legal services are provided in the most efficient way practicable. We see this as something which should help to strengthen our relationship.”
Rio Tinto managing attorney Leah Cooper emphasised that a CPA lawyer would cost around $250 per day, which is “less than a very junior lawyer at a major law firm”.
She added that potential issues of confidentiality and competency that may be involved with having third party providers had been addressed by CPA.
“Our dedicated team sits in a branded Rio Tinto room, literally with fingerprinted access. Nobody else from CPA can get in or out, they don’t have printers,” she clarified.