How to Create Cohesion Between Legal, Tax, and Finance Teams | MinuteBox Cloud Entity Management

How to Create Cohesion Between Legal, Tax, and Finance Teams

Responsibilities placed upon legal departments have thoroughly expanded in recent years. Where once entity management required legal teams to maintain diligent minute book records, modern entity management plays a more strategic role in global business leadership.

Legal teams must coalesce with compliance, tax, and finance departments to implement effective entity management practices. Collaborative efforts between various department stakeholders allow for accurate summations of reporting data. Additionally, unity between each department minimizes corporate risk and protects the legal standing of the corporate entity.

What is modern entity management?

Once upon a time, entity management described the management of basic entity information, such as managing, sorting, and filing accurate minute book records.

Modern entity management has expanded into a more complex series of responsibilities. Sound entity management processes enable corporations to implement sustainable corporate governance and compliance across a global business entity.

How modern entity management affects general counsel

Forward-thinking corporations incorporate entity management practices into business strategy. This is one of the reasons why general counsellors increasingly function as strategic advisors to a corporate entity’s board of directors.

In a 2022 survey analyzing general counsel’s expansive role in business operations, 76% of participants expect their respective general counsellors to serve in several strategic roles for their businesses.

  • Act as a legal counsellor and manager of legal risk for the corporation
  • Contribute their views on business strategy and operations
  • Actively participate in strategic planning and decision-making for the business

The data acknowledges the potential risks and costs of entity management and the potential that those risks could disrupt options or dovetail growth. The general counsel functions as a leader and advisor to corporate stakeholders while directing legal entity management at an operational level throughout the organization.

With entity management carrying significant risks to the business, general counsel uses their expansive leadership position to drive entity management best practices across numerous departments. Collaboration is most common across legal, compliance, finance, and tax departments.

Here are some of the best ways general counsel can align various departments and create a more robust entity management workflow.

Learn how to speak the language of various department heads

Legal and compliance teams share similar goals, and they sometimes function as the same, depending on the corporation. Similarly, finance and tax departments also speak similar languages, analyzing key decisions based on projected revenues or costs.

Use the position of strategic business advisor to effect

General counsel should tailor the need for effective legal entity management using language that various department heads will comprehend. In the role of strategic advisor, general counsel regularly data, trends, and dynamics to determine their collective impact. Use that analytical approach to explain the need for cooperation and create effective entity management workflows.

Create efficient entity management workflows

Finally, outline an entity management workflow that is efficient and effective. Explain how teamwork across the various departments helps streamline how reporting data is gathered, filed, and submitted. Research various tools and resources that will assist with the entity management workflow and select one that helps centralize all aspects of entity management.

Invest in entity management software to facilitate alignment

After receiving buy-in from various department heads, and creating strategic frameworks for entity management workflows, it’s time to establish the working processes. First and foremost, you need to select the right resources to assist with the workload.

Entity management software is the best resource to align legal, compliance, finance, and tax teams. These systems are built by legal professionals for legal professionals, creating a centralized single source of truth for all legal entity data.

The platforms include built-in compliance frameworks with easy-to-use modules that function as digital checklists for all matters concerning legal compliance. Additionally, you can build structured organizational charts, cap tables, and shareholder ledgers within the platform. All the corresponding data is centrally located, allowing managers from finance, tax, and compliance to add their contributions and finalize all reporting data.

Using entity management software, organizations can address critical entity management functions in a structured and consistent manner. Most importantly, they make entity management workflows more efficient and collaborative. Teams across multiple departments can work towards a common goal, and general counsel can provide progress reports in their respective roles as strategic advisors to the board.