22 Jan 2013

In-house roles lure Japanese lawyers

Japanese lawyers are increasingly taking up positions in-house as companies in the region turn to their own legal departments to cut costs and advise on compliance.

Tokyo: lawyer glut

Tokyo: lawyer glut Cowardlion/Shutterstock.com

According to the Japan Federation of Bar Associations (JFBA), 770 Japanese-qualified lawyers – known as bengoshi -- are now working in corporate law departments. This is a significant rise from a decade ago, when just 64 bengoshi worked in-house.
However, the recent figures only make up a small percentage of the 32,000 bengoshi currently qualified to practise, reports the Asian Lawyer web.

Tsunami impact

Local recruiters cited several factors for increasing moves in house, with the most prominent being the lasting economic impact of the 2011 earthquake and tsunami, which has forced companies to cut costs and solve legal issues internally.
Several high-profile scandals also rocked the legal landscape, including one at the Daio Paper Corporation, whose former chairman, Mototaka Ikawa, was sentenced in October to a four-year prison term for using company cash to pay off gambling debts, a case that prompted a greater emphasis on compliance more widely in corporate Japan.

More lawyers

But according to Yasushi Murofushi, president of the Japan In-House Lawyers Association, the biggest single reason for the shift is simply because of the increase in lawyers. According to bar association statistics, the number of bengoshi has increased by 12,000 since 2005 -- equal to the growth in the 50 years to 2001.
Tadaaki Sugiyama, general counsel at chemical and cosmetics business Kao Corporation, agreed with Mr Murofushi, adding that the influx of new graduates has given corporations the chance to hire well-qualified bengoshi at lesser salaries. ‘For me it's a good chance to hire a person with professional knowledge at a lower cost,’ he said.