Why Legal and Finance Teams Need to Collaborate

Collaboration between legal and finance teams is imperative for companies using software as a service (SaaS). The synergy between these two departments enables them to navigate obstacles and achieve business success. Transparent communication, shared workspaces, and team-building facilitate effective collaboration between legal and finance, while legal’s enterprise legal management  (ELM) systems can be used to streamline the contract process for finance, according to a blog post by LinkSquares.

There are a number of drivers for the collaboration between legal and finance teams: 

• Legal and finance form the first line of defense for the company by managing risks through regulatory compliance and financial oversight. 
• Strategic decision-making enables bold business moves with the assurance of legal compliance and financial prudence. 
• Maintaining regulatory compliance at both national and international levels, with the legal team negotiating the complexity of legislation and the finance team establishing financial compliance with these rules, is critical for success. 
• The expertise of the General Counsel or Legal Ops Manager in contract management combined with the finance team’s understanding of investment risks and returns enables swift and informed business transactions.
• Operational efficiency is achieved through legal and finance teams ensuring open communication, shared expertise, and elimination of redundancies, fostering a cohesive and streamlined working environment. 

Isolating legal and finance teams poses substantial risks, including potential financial and legal pitfalls that can lead to significant losses. Fostering collaboration and agreement between these teams is critical for successful risk management. 

With the legal and finance teams working together, the company can establish an efficient operational structure and lay the foundation for innovation and strategy. This integrated approach allows organizations to navigate the dynamic business landscape effectively and build long-term collaborative relationships.