What Is A Contract Clause Library? - Definition
A contract clause library is simply a library in the application where you store the clauses you use to build contracts. Within this library, you may find:
- Types of clauses – definitions of each type of clause with a correlation to the type of contract to which it might belong.
- Actual clauses – the repository for the above defined clauses that you’ll use when generating contracts.
- Clause bundles – clauses grouped by common types of contracts they’re normally added to.
- Modified clauses – Clauses that are in use by a specific document. If these clauses need updates during the course of negotiations, you can update the language without affecting the master clause within the library.
- Alternative clauses – these are clauses that have been tagged as pre-approved alternatives for current clauses. This allows anyone working on the contract to swap out current clauses for alternatives when the occasion calls for it.
- Sub-clauses – these are separate, but related objects of the master clauses. All master clauses can have several sub-clauses or none at all – but the contract clause library allows you to match and manage all sub-clauses.

Understanding Contract Clause Library
Clause libraries are repositories filled with standardized template clauses that have been pre-constructed and pre-approved. Clause libraries typically also boast a wide range of additional features that can be built on top of this repository functionality, like version control, metadata, access rights and workflow approval, etc.
Importance of Contract Clause Library
Contract clause libraries have several benefits, including increased department efficiency. Even the employees who have no legal knowledge can quickly create accurate contracts that are legally compliant and conform to your company standards. This is also useful if your organization has several types of contracts that are in frequent use. It helps manage the application of business rules to various clauses and the timing. Many CLM systems also allow variations to the specific language used throughout negotiations and other creation processes.
The benefits of clause libraries are numerous:
- Save time: Reduce time spent manually searching for a clause and then copying and pasting that clause into a contract. Intelligent clauses can furthermore limit or outright eliminate time spent “cleaning up” a clause to be consistent with the rest of the contract in which it is being inserted.
- Reduce risk: Non-standardised contract drafting is a lot more susceptible to drafting errors.
- Optimize performance: Facilitate onboarding of new colleagues, improve knowledge management and deployment, and send a uniform and consistent image to clients and business partners on the look, feel and content of your contracts.
Explore Additional Resources to Know More

On-demand Webinar
Contract Lifecycle Management on ServiceNow AI + Digital Workflows
A smarter approach to manage contractual obligations with AI and Digital Workflows using Aavenir Obligationflow on ServiceNow.

On-demand Webinar
Discover. Assign. Monitor- Contract Obligations on ServiceNow
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