These findings and more are revealed in the 2026 Legal Budgeting Report: In-House Legal’s Journey to Value, a global study of 530 senior legal decision-makers (CLOs, GCs, DGCs) as well as the CFOs they partner with, conducted by The Harris Poll and commissioned by Axiom. This year’s report incorporates both Legal and Finance perspectives to examine budgeting practices and financial maturity in enterprise legal departments with annual revenues of $500M or higher—and 55% over $1 billion.
The Axiom In-House Legal Budget Maturity Index measures five dimensions that distinguish legal departments that function as value creators: budget decision authority, performance measurement capabilities, value orientation, strategic alignment with business goals, and strategic use of alternative legal service providers (ALSPs). Most legal departments are in the “developing” range of the maturity index, with an average maturity score of 64 out of 100. The good news is that, with minimal effort, emulating the best practices of the most value-oriented legal teams, those in the developing center could quickly pass the tipping point (70+ maturity score) into value-based budgeting and performance—driving significant business value and cementing their positions as strategic business partners in the process.
Among the most significant findings:
- The CFO-Legal Partnership Paradox: Despite 89% rating relationships between the GC and CFO in their companies as excellent, 50% of CFOs said they control legal budget-setting, while just 32% of legal leaders said their CFO has independent budget-setting authority, revealing confusion about who actually owns the budget-setting process.
- AI Expectations vs. Funding: Legal departments face a budget dilemma in responding to AI mandates: an overwhelming 78% of legal budget decision-makers reported they’re expected to implement legal AI without dedicated funding. Nearly a third (31%) said this happens frequently.
- Transformation Momentum is Building: 49% of legal departments have already changed budget models in the past year, with another 36% planning additional changes in 2026 – proving the shift to value-based performance is actively underway.
- Strong Foundation in Place: Legal departments excel at performance measurement (73 average score) but lag in value orientation (58 average score) and strategic alignment (58 average score).
- ALSPs as Value Accelerators: 68% of legal leaders would switch from law firms to ALSPs at just 30% or less cost savings, yet only 36% have formal policies in place to encourage use of ALSPs in place of more expensive law firms, revealing a massive value-creation opportunity.
- Excellence Within Reach: Companies in all eight countries surveyed fell within a narrow 6-point range (61%-67%), with shared barriers to value-based budgeting excellence that could be overcome by adopting the proven techniques employed by the most mature leaders.
“The research confirms what we’re hearing from clients – legal teams are embracing the shift from cost-focused budgeting to strategic value creation,” said David McVeigh, CEO of Axiom. “The highest-performing departments are succeeding through disciplined resource allocation, CFO alignment, and flexible talent integration – treating their budget as a strategic business investment, not a cost center.”
The research suggests that enterprise legal departments stuck in traditional risk management thinking can accelerate their budget transformation by following the proven blueprint of high-performing teams. The most mature organizations excel at bridging the CFO-Legal Partnership Paradox and establishing clear budget authority alignment while implementing comprehensive ROI measurement frameworks that translate performance data into strategic business value.
Strategic ALSP adoption varies dramatically by maturity level, with mature organizations allocating 24% of their legal spend to ALSPs compared to just 9% for immature departments—nearly a 3x difference that demonstrates how sophisticated legal teams leverage flexible talent as a competitive advantage.
“The difference between a cost center and a value creator isn’t reinvention, it’s refinement,” said Eric Bouchard, Chief Financial Officer at Axiom. “The most sophisticated legal departments use performance data, AI-enabled tools, and flexible resources to show CFOs exactly how legal spend fuels competitive advantage, mitigates risk, and protects revenue. That’s what turns legal from a necessary expense into a strategic business driver.”
A cross-functional panel will unpack these survey findings and demonstrate practical implementation strategies during Axiom’s October 1, 2025, webinar, “Rewriting the Rules of Legal Budgeting,” helping legal and finance leaders elevate their budgeting maturity. Click here to register.
Axiom’s 2026 Legal Budgeting Report: In-House Legal’s Journey to Value is available for download immediately at: https://www.axiomlaw.com/resources/articles/legal-budgeting-survey-report
For more information about Axiom, please visit our website, hear from our experts on the Inside Axiom blog, network with us on LinkedIn, and subscribe to our YouTube channel.
Methodology
This online survey was conducted The Harris Poll on behalf of Axiom Law from July 7-25, 2025, among 530 senior executive legal budget decision-makers in companies with annual revenues of $500M or higher, 55% from companies with revenue of $1B or higher.
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About The Harris Poll
The Harris Poll is a global public opinion, analytics, and market research consultancy that strives to reveal society’s authentic values to inspire leaders to create a better tomorrow. With a global research reach of more than ninety countries, Harris offers advisory services across sectors to world leaders, CEOs, and business decision-makers with state-of-the-art analytics, real-time software services, and practitioners in marketing, reputation, customer experience, trends, futures, and thought leadership/research-for-public release, The Harris Poll translates shifting social sentiment into a competitive marketplace advantage. Harris is a Stagwell company. http://www.theharrispoll.com
About Axiom
Axiom invented the alternative legal services industry 25 years ago and now serves more than 3,500 legal departments globally, including 75% of the Fortune 100, who place their trust in Axiom, with 95% client satisfaction. Axiom gives small, mid-market, and enterprise clients a single trusted provider who can deliver a full spectrum of legal solutions and services across more than a dozen practice areas and all major industries at rates up to 50% less than national law firms. To learn how Axiom can help your legal departments do more for less, visit axiomlaw.com.
SOURCE Axiom Global Inc.
