The Association of Corporate Counsel Names Axalta Coating Systems a 2016 ACC "Value Champion"
The Association of Corporate Counsel (ACC) announced today that Axalta Coating Systems (NYSE:AXTA), a leading manufacturer of liquid and powder coatings, was named a 2016 ACC Value Champion for the manner in which it was able to help the procurement department transform its procedures, saving time and reducing legal fees.
A component of the ACC Value Challenge, which promotes reconnecting the cost and value of legal services, the ACC Value Champions initiative recognized Axalta as one of twelve corporate legal departments and law department/law firm or legal service provider collaborations that delivered substantial value to their client organizations by cutting spending, improving predictability and achieving better legal outcomes.
“This year’s ACC Value Champions demonstrate the positive impact a strong law department has on the business and its bottom line,” said Veta T. Richardson, president and CEO of ACC. “The law departments we honored created solutions to business problems, initiated strong partnerships with other departments as well as outside counsel, and created processes and systems to empower clients to initiate business agreements and get answers quickly.”
Axalta seized an opportunity to start anew after the company separated from DuPont in a carve out. The Law Department, with help from Hunton & Williams, built templates and playbooks to overhaul procurement, a crucial part of the business. Lawyers provided training on using the playbooks; as a result, the procurement department now processes 62 percent of contracts without engaging the legal department, approaching an 80 percent goal. Due to these initiatives and alternative fee arrangement-based spending with Hunton & Williams, annual spend for commercial contract review by outside counsel has dropped 80 percent.
“We’re tremendously proud to receive this level of peer recognition for the work our Law Department and partners at Hunton & Williams have performed,” explained Michael Finn, Axalta Senior Vice President and General Counsel. “Our procurement department is the single largest area of spend at the company and being able to support their work and create added efficiencies has been gratifying. Our work with our in-house client and the Hunton team was all the more rewarding because we accomplished it while the entire company was transitioning into becoming an independent organization.”
Axalta worked with Richmond-based Hunton & Williams attorneys on a fixed-fee basis to create a more effective contracting system focusing on value, performance, and efficiency. Each new set of procurement templates was paired with a set of procedures guiding their use and negotiation. In the process, the attorneys collaborated to develop a collective view of unique commercial aspects and risk tolerance of the business, then drafted agreements that balanced the need for efficient negotiations with protecting Axalta’s interests.
Making the process even more challenging was the fact that many of the staff of both the Law and Procurement Departments were new to the company. While bringing fresh perspective to the company, they had to work through existing systems and keep the business running in the midst of changing not only procurement procedures but a myriad of other business systems that required support from the Law Department.
“It’s rare for a company to re-do its entire way of buying,” explained Randall Parks, the partner at Hunton & Williams who supported the project. “The innovation was in the scale of the project and the legal team’s ability to rethink how the legal organization engaged a large swath of its business.”
ACC received 57 nominations from law departments and law firms with at least one year of results tracking. The complete list of the 2016 ACC Value Champions, along with additional details related to the Axalta submission, can be viewed online at: www.acc.com/valuechampions.
About Axalta Coating Systems – Celebrating 150 Years in the Coatings Industry
Axalta is a leading global company focused solely on coatings and providing customers with innovative, colorful, beautiful and sustainable solutions. From light OEM vehicles, commercial vehicles and refinish applications to electric motors, buildings and pipelines, our coatings are designed to prevent corrosion, increase productivity and enable the materials we coat to last longer. Celebrating 150 years of experience in the coatings industry, the more than 12,800 people of Axalta continue to find ways to serve our more than 100,000 customers in 130 countries better every day with the finest coatings, application systems and technology. For more information visit axaltacoatingsystems.com and follow us @axalta on Twitter and on LinkedIn.