Insights and updates
from MinuteBox

In today’s fast-paced business environment, staying on top of the latest technology is crucial for any industry, including the legal sector. One area that is seeing significant growth and innovation is LegalTech, and there are a few specific technologies that are particularly exciting to industry experts.

Here’s a summary of what we explore in this post:

• Legal entity management is a highly important and exciting area in LegalTech.
• Cloud-based solutions are great, but it’s important to work closely with vendors to ensure they understand how to make changes quickly to keep clients in the loop.
• Technology that allows for collaboration with clients and secure document management, is also a highly valuable and innovative area in LegalTech.

One of the most exciting areas of LegalTechis legal entity management. As Karen Tuschak, a legal industry expert, points out, “legal entity management is huge. I often say that corporate touches every aspect of a firm. The litigation lawyers, the real estate lawyers, they’re all looking for information about corporation clients. So legal entity management is huge.” By streamlining and centralizing the management of legal entities, firms can save time and improve efficiency, allowing them to focus on more important matters such as serving their clients.

Watch the full interview, Exploring the Most Exciting Technology in LegalTech: Insights from Industry Experts

Another area of LegalTech that is gaining traction is cloud-based solutions. As Karen notes, “cloud-based solutions are great. Just make sure you really work with your vendors so they understand how making those changes quickly keeps the clients in the loop.” By leveraging cloud technology, firms can enjoy increased scalability, enhanced accessibility and the ability to streamline routine tasks. This can be especially beneficial for firms that are looking to save costs, as well as those that are looking to increase productivity and efficiency.

Finally, closing technology is another area of LegalTech that is seeing significant growth and innovation. As Karen explains, “closing technology allows you to collaborate with your clients in one area securely. You send this stuff out by DocuSign and it comes back and you whip together a closing book. So anything like that really reinvents and invigorates the way you do the work, and that is huge.”

Staying on top of the latest legal technology is extremely important, but particularly so in this environment. There are many areas of legaltech that are heating up and seeing incredible progress. Two of those areas are transaction closing technology and legal entity management. Both are worth checking out and discovering more about in a corporate law pracice.

Compliance and ethics each influence how business entities function on a day to day basis. One is a mandatory set of operational guidelines, and the other refers to how an entity chooses to behave.

A business needs both ethics and compliance to function effectively. Let’s break down the differences between the two and offer some strategies on how to abide by them both.

What is the difference between compliance and ethics?

Before we outline strategies for how to remain in compliance while also following ethical principles, it’s important to define both compliance and ethics. They do have their similarities, but there are also key differences between them.

Corporate compliance refers to the act of complying with a series of laws, by-laws, rules, and policies that regulate how entities operate. Many businesses have positions akin to Chief Compliance Officers, who oversee compliance programs that include ongoing training and communications for all entity employees.

Meanwhile, ethics revolves around moral principles rather than legal mandates. Some companies even create business ethics standards that outline morally acceptable and unacceptable behaviors when conducting business.

Are there similarities between ethics and compliance?

Compliance programs are enacted based upon jurisdictional laws established by regulators in a geographical area where an entity operates. However, some would argue that company culture is where compliance begins.

Company culture is developed using a shared philosophy of ethics, values, missions, and visions. These principles can instill a recognition that compliance is not only a legal requirement, but also the morally correct thing to do as an organization. In that sense, compliance and ethics do complement each other and inform how entities continue to operate.

What role does corporate governance play in compliance?

Corporate governance is another integral piece of the Governance, Risk Management, and Compliance (GRC) program that informs legal entity management. Corporate governance refers to an entity’s internal checks and balances that help the business remain compliant.

Corporate governance is more beneficial than simply supporting compliance. Analyses of S&P 500 corporations found that companies with strong corporate governance policies and procedures outperformed those with weaker governance by up to 15%.

Therefore, it can be argued that implementing effective corporate governance policies supports compliance and ethics, but it can also influence growth for the business.

What are the effects of non-compliance for an entity?

Failing to implement strong governance policies risks placing your entity in a position of non-compliance. If your business breaks the law or fails to observe federal, provincial, or state regulations, you risk subjecting your entity to the penalties of non-compliance.

What’s an example of non-compliance? Fiscal mismanagement or fraud are prime examples of white collar crime and non-compliant activities. Often, financial fraud occurs due to a lack of organizational structure and governance within an entity. Lacking the authoritative executives and directors to instill those important checks and balances, unethical and illegal practices are free to occur.

How to establish compliance and ethics within your entity

So, what’s the best way to implement corporate compliance and ethics throughout your organization? Many businesses use legal entity management software to establish their compliance programs and implement effective corporate governance. These programs, by extension, reinforce company culture that adheres to moral and ethical principles.

Using entity management software, you can create the Articles of Incorporation for your company. Articles of Incorporation are legally binding documents that must be created when launching a new entity or a subsidiary under that corporate umbrella. The Articles of Incorporation are then shared with the proper regulators to officially launch your business.

Additionally, you can use entity management software to establish organizational charts that document the hierarchy of executive authority. Your legal and compliance teams can use these organization charts to ensure proper oversight and signatory approval on any pressing business matters are enacted to remain in compliance. Regulators can also use copies of these organization charts to speak with the named executives in the event of an audit or other regulatory procedure.

The best part of entity management software is that it streamlines the entire compliance process for your entire team. The platform is intuitive and designed with pre-built templates of crucial corporate documents. Your team can use these templates to construct corporate compliance documents in a fraction of the time it would take to create these documents outside the platform.

In summary, entity management software helps your team work smarter, faster, and towards the goal of fulfilling your business compliance and ethics requirements.

Corporate paralegals must have an attention to detail and stringent organizational skills to thrive in their careers. They also need excellent communication skills and an inherent ability to simplify complex legal jargon for corporate managers, directors, and shareholders to comprehend.

Since paralegals spend most of their days conducting research for cases, tracking deadlines, managing schedules, and filing minute book records, great organizational and communication skills are the bedrock of how paralegals build sustainable careers. Additionally, they need the right tools to manage expectations and monitor all important records.

Why entity management software is a paralegal’s best friend

Among the most helpful resources for corporate paralegals are entity management solutions. Entity management software is an intuitive, cloud-based platform that simplifies how legal teams manage large amounts of data for various legal entities.

As a corporate paralegal, managing all the legal entity affairs for the parent company is a taxing challenge in itself. If the entity has multiple subsidiaries under its corporate umbrella, it becomes significantly more difficult to remain organized, responsive, and transparent with all the people involved in managing those corporate affairs.

Entity management software automates many clerical tasks with time-efficient workflows. This is the best way to maintain those coveted organizational skills as you manage multiple entities and subsidiaries. Additionally, by automating most of the clerical work, you have more time to address any questions or concerns about minute book records from corporate executive teams.

How entity management software supports paralegal skills

Organizational and communication skills are critical components of a successful paralegal’s career. Now, let’s break down some of the tactical competencies of a paralegal’s day to day activity and how entity management software helps paralegals conduct themselves.

Managing documentation for mergers and acquisitions

Suppose the business entity your paralegals represent is undergoing an acquisition of a separate entity. Think about all the steps involved in an acquisition process:

• Researching the entity in question
• Contacting executives of that entity
• Making introductions with your own executive team
• Submitting an offer to the financial and legal heads of the entity
• Conducting due diligence into the entity’s financial history
• Preparing the documents that legalize the note of acquisition
• Preparing the documents that finalize the acquisition deal
• Submitting all the paperwork with regulators

It’s a lot of work, and it requires managing time with a lot of different stakeholders. Entity management software allows your paralegals to maintain diligent and digitized records that monitor each step of the process. Your paralegals use the platform to track important filing dates for each stage of the process, keeping an organized checklist of signatory approvals necessary to complete those files. They can then note the record on the platform so the process can continue.

Maintaining accurate records to support corporate governance

Here’s another hypothetical scenario. Suppose your company has received a summons from federal regulators to conduct an audit. Your legal department is tasked with leading the coordination with the regulators to keep the business out of any legal quandaries.

Entity management software is one of the best resources to maintain accurate and diligent records of all corporate transactions. Every time a purchase is made, an acquisition is conducted, or a shareholder invests new capital into the entity, it can all be recorded within the platform to promote proper corporate governance.

The consequences of failing to comply with corporate governance policies can potentially bankrupt your business entity. Look no further than the FTX case that forced the company into insolvency and resulted in criminal charges against the founder as he awaits trial.

Corporate governance ensures your entity is prepared for any regulatory inquiries or investigations. Your paralegals use entity management software to maintain accurate minute book records, and they can assist your in-house counsel with communicating the details of those records to the regulators at the appropriate times.

Protecting confidential entity information with advanced security measures

Any corporate documentation is extremely sensitive and confidential. It requires paralegals to maintain rigid organizational standards to protect the contents of those records.

The problem with traditional methods of corporate recordkeeping is that paper files are so easy to lose or misplace. Suppose a record with a signature from a corporate manager is lost in cluttered office spaces, negating the authorization applied to the record in question. What kind of setback does that create for the company as a whole?

Additionally, this process is very tedious and time consuming. On average, it takes paralegals up to five minutes to sort, tag, file, and organize a single page in a minute book record. Each minute book contains numerous pages, and there are likely multiple minute books in any standard office filing cabinet. Multiply all those records by the number of pages stored within, and you can see how much of your paralegal’s time is spent organizing paperwork in unsecure ways.

Entity management software is backed by biometric and hardware key authentication. This ensures that only those who have been given specific access to the platform can view the records. It protects the security of your business entity, an important step in the road towards corporate compliance and good governance.

Time is a luxury that many businesses can’t afford to spare. Global organizations always seek more efficient and innovative solutions to streamline workflows, accelerate deliverables, and generate results in the pursuit of growth.

In the legal entity management field, it’s no different. Legal departments, corporate secretaries, and compliance professionals are often inundated with repetitive administrative or clerical workloads. In between managing minute book records and corporate documentation, these teams of professionals must meet filing deadlines and manage inquiries from jurisdictional regulators to remain in compliance.

Global entity management systems assist legal teams with more streamlined and efficient methodologies to support corporate compliance. Here are five of the chief benefits of global legal entity management systems and how they help modernize entity management workflows.

Increased focus on compliance deadlines

One of the biggest responsibilities for legal entity managers is to stay on top of all the administrative tasks to help an entity remain in compliance. Examples of these tasks include:

• Uploading corporate organization charts
• Managing compliance deadlines
• Coordinating multiple calendars
• Filing statutory and date-based compliance tasks
• Completing minute book records
• Generating annual reports
• Modernizing corporate documentation workflows

With a global legal entity management system, you can streamline all of these tasks. Built-in compliance modules include pre-built templates on how to create each of these corporate records to help your organization remain in compliance. It makes it easier to create, edit, and manage the documentation, saving valuable working time for your entire legal department.

Reduced risks of non-compliance penalties

Remaining in compliance with jurisdictional laws keeps your company from falling into legal and financial peril. One need look no further than the collapse of FTX as an example of a company operating in bad faith and the fallout from those non-compliance business decisions.

Using a legal entity management system, you store all your important corporate data in one centralized location. There’s no risk that paper records will go missing or be accidentally tossed in the trash. Everything is stored in cloud-based servers that make it easy and convenient to access corporate records whenever a situation calls for clarity.

Increased security with no technical expertise required

Transitioning your corporate documentation to a legal entity management cloud is not only a time saving benefit. You can accelerate documentation workflows without adding additional technical expertise to your company’s payroll.

Legal entity management systems include no-code document generation features. You can easily create and customize legal documents without the need for technical expertise to complete these tasks. The platforms are intuitive enough to generate PDF-style templates of these documents that are easy to modify as necessary.

Improved corporate transparency with regulators

When regulators come calling, you want to provide clear and accurate minute book records. Transparent documentation makes any scheduled or unscheduled auditing session quick and painless. Satisfying regulators with your diligent recordkeeping is one of the best ways to avoid the repercussions of non-compliance business activities.

Since all minute book records are stored in your legal entity management system, you can sit down with regulators for scheduled sessions and walk them through the documentation. Advanced search filters allow you to pull up any records under scrutiny in a matter of seconds, which will go a long way towards keeping your entity out of legal hot water.

Greater efficiencies with meetings and signatory approvals

We end where we began around the idea of time saving efficiencies. Using cloud-based global entity management systems, you can conduct all meetings with entity executives, directors, and shareholders from any location.
Data shows that nearly three out of four corporate executives want greater flexibility when it comes to running important meetings for the business. Since minute book records are stored within the entity management system’s cloud-based servers, the records can be viewed from anywhere with an internet connection.

Imagine granting your legal entity management team the ability to conduct minute book record meetings and reviews with key stakeholders at their convenience. Instead of coordinating a review session across multiple calendars to arrange time for everyone to be in the same room, the meeting can be conducted virtually from anywhere. Plus, the built-in e-signature feature makes it easier to get signatory approval on any finalized documents.

The legal industry is rapidly adopting cloud-based technology, and for good reason. From increased efficiency and productivity to enhanced accessibility and scalability, the benefits of cloud-based technology are numerous. In this blog post, we’ll explore the advantages of cloud-based technology in the legal industry, as discussed by Tiffany Pereira, Director of Customer Success at MinuteBox.

In this post, we’ll cover how cloud-based technology:

• Streamlines routine tasks and centralizes disparate systems
• Boosts productivity and efficiency
• Eliminates the need to maintain expensive and insecure server structures
• Allows for instant adoption of new features and functionalities
• Can have scheduled downtime windows

The move to the cloud has been accelerated by the pandemic, and it’s clear to see why. Cloud-based technologies like MinuteBox are becoming increasingly popular tools across all law firms. Investing in a serverless architecture is an effective way to streamline processes, save on costs, increase scalability, and enhance accessibility.

Watch the full interview, The Advantages of Cloud-Based Technology in the Legal Industry

Tiffany explains that practice management systems and entity management systems can help to streamline routine tasks and centralize seemingly disparate systems. This results in a boost in productivity and efficiency, allowing for more time to be allocated to clients. Additionally, there is no need to maintain an expensive and insecure server structure, and the adoption of new features and functionalities is instant.

Another advantage of cloud-based technology is the lack of scheduled downtime windows. Tiffany explains that this can be a huge value add for a firm, as it eliminates the frustration of not being able to access the system during certain times.

Overall, it’s clear that the benefits of cloud-based technology in the legal industry are numerous. From increased efficiency and productivity to enhanced accessibility and scalability, the advantages of cloud-based technology are undeniable. As Tiffany concludes, “being able to say, we can push out that change and there is no downtime, it’s not gonna affect any user, is a huge value add for any firm.”

Corporate compliance refers to internal policies and procedures enacted by a legal entity in response to federal or provincial laws and regulations. An enforced compliance program detects and prevents any violations of those regulations, protecting the corporation from any fines or criminal indictments that may occur as a result of those violations.

So, how does a legal entity enact an effective corporate compliance program? We’ve done the research, and we’ve identified seven elements of an effective compliance program that all legal entities should administer in their own corporate structures. Let’s break down those seven steps.

Why is corporate compliance important?

Before diving into the specific sequences of a compliance program, let’s begin by answering a very fundamental question. Why is corporate compliance so important in the first place?

A corporate compliance program helps organizations prevent any discrepancies that could result in non-compliance penalties for the business. Canadian regulators are cracking down on white collar crimes, targeting organizations that violate compliance policies.

Crackdowns are being implemented in response to the Cullen Commission. The commission’s report was the culmination of years-long money laundering inquiries in British Columbia. The report’s recommendations were submitted to the federal government in Ottawa.

Following the submission, the RCMP was tasked with enforcing new regulations against complex financial crimes. This resulted in the creation of the Integrated Market Enforcement Team’s Special Advisory Group and the Canadian Financial Crime Agency. The purpose of these institutions is to hold accountable any individuals or legal entities that commit fraud, money-laundering, insider trading, organized crime, and other financial crimes that put Canadians at risk.

What is the purpose of a corporate compliance program?

The federal government and the national police force are enforcing compliance laws to reduce the amount of white collar crime across Canada. Organizations that lack effective compliance policies are at risk of being swept up in these investigations. If there is evidence of deliberate malfeasance, businesses can be subject to steep financial penalties for non-compliance.

Therefore, the purpose of a corporate compliance program is to mitigate risk and protect organizations from severe, long-term financial losses. An effective corporate compliance program sets boundaries to enforce permissible conduct and good governance.

7 elements of an effective compliance program

So, what are the 7 elements of an effective compliance program? Here’s what you need to know to create a corporate compliance program that will protect your organization from unwanted regulatory investigations, penalties, and other long-term consequences.

1. Documented policies and procedures

Documentation of policies, procedures, rules, and controls demonstrates your company’s determination to abide by compliance laws. Written documentation enables compliance officers to enforce the mandate and ensure the organization “practices what it preaches.”

You can simplify the documentation process by using entity management systems with built-in compliance modules. A built-in compliance framework monitors your organizational charts, calendars, workflows, and other templates for any errors, statutory non-compliance, and date-based compliance tasks that may be lacking. These automated workflows help your organization follow the jurisdictional letter of the law so that you always remain in compliance.

1. Designated compliance officers

Org. charts provide oversight into the various executives and directors responsible for managing the legal entity. Among the featured positions on your organizational charts should be a Chief Compliance Officer, whose purpose is to enforce the documented compliance policies and procedures.

A Chief Compliance Officer must have the authority to maintain direct communication with all executive officers and members of the Board of Directors. While it’s not mandated, the person selected for this position should have previous legal experience. This will help the officer enforce the protocols and protect the organization from inadvertent non-compliance.

1. Effective training procedures

Training is absolutely essential to an effective compliance program. Once the policies have been created, the Chief Compliance Officer and his/her team must enact training protocols to properly educate employees, business partners, executives, directors, and shareholders on the fundamentals of the corporate compliance program.

The purpose of compliance training is to ensure everyone associated with the entity fully understands the rules of corporate compliance. Once the training is complete, updates should be made to minute book records notarizing the completion of the training programs. If outside regulators ever investigate the company, these records will show that the entity has crafted effective corporate compliance programs.

1. Whistleblower reporting programs

If there are incidents of behaviour that are not in compliance with corporate policies, there needs to be a reporting mechanism in place. Sometimes, individuals who witness those examples of non-compliance actions fear the ramifications of speaking up.

Part of an effective compliance program is giving those witnesses the option of anonymously reporting the facts. This will help increase accountability and allow organizations to catch non-compliance behaviours before they cost the company significant penalties. People will feel more comfortable reporting the truth to compliance officers, allowing those officers to nip the problems in the bud before they spiral out of control.

1. Monitoring and auditing

The Chief Compliance Officer’s roles and responsibilities include monitoring and auditing the corporate compliance program. These reviews of the program should be done periodically, and if any issues are identified, those problems should be immediately addressed and fixed.

An entity management platform with a built-in compliance module can assist with the monitoring and auditing process of your compliance program. Use the compliance module to review the documented policies and ensure no errors or statutory non-compliance tasks are missing from the corporate program.

1.  Enforcement of compliance policies

The Chief Compliance Officer is also responsible for enforcing the compliance program. This means subjecting every member of the organization, including the CEO and the Board of Directors, to the same standards and requirements as interns or contract workers.

Compliance is a ubiquitous requirement that all levels of the organization must abide by to remain compliant with the laws of the land. Enforcement of the compliance program ensures that no special treatment is awarded and no bending of the rules is prohibited.

1. Investigating and responding to non-compliance

Finally, investigations and responses to non-compliance behaviours are the only way to ensure the program is enforced across the organization. Compliance officers must step in and lead the investigations when the organization is at risk of non-compliance.

A compliance program that has no teeth is an ineffective set of guidelines. Properly responding to and investigating incidents of non-compliance may result in short-term pain, but it will effectively prevent the organization from becoming subjugated to stiff penalties from the law.