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The legal profession, traditionally cautious about change, is entering a transformative phase driven by artificial intelligence (AI). According to the 2024 Generative AI in Professional Services report by Thomson Reuters, a growing majority of in-house legal teams and law firms see AI as an essential tool for modern practice, with its adoption poised to reshape the sector.
The report reveals that 62% of corporate counsel believe AI should play a role in their work, marking a significant jump from 54% in 2023. While many legal professionals remain wary of AI's potential pitfalls, the momentum toward its integration is undeniable. AI's promise to enhance efficiency and accuracy is driving its adoption, despite the challenges posed by confidentiality concerns and the risk of erroneous outputs.
Rising Adoption of AI Tools
Currently, 27% of legal teams are experimenting with general AI tools like ChatGPT. More importantly, the trend toward specialized AI solutions tailored to the legal field is gaining traction. While only 12% of teams use legal-specific AI tools today, nearly half (43%) plan to adopt such technologies within the next three years.
John Shatwell, Thomson Reuters’ head of legal professionals for Europe, sees this as a sign of maturity in how legal professionals approach AI. “Legal professionals are increasingly recognizing the difference in value between generic AI tools and industry-specific use cases. They are excited to advance alongside the technology,” he notes.
A key milestone in this evolution is the establishment of internal policies governing AI usage. Around 21% of corporate legal teams and 10% of law firms have implemented formal AI policies, addressing past concerns about unauthorized or unmanaged AI use.
Challenges on the Horizon
Despite the enthusiasm, there are hurdles to AI’s full-scale adoption in the legal sector. The report highlights that 77% of legal professionals remain cautious, with significant concerns about confidentiality breaches and the risk of AI generating inaccurate or fictitious legal information.
Another major issue is the potential for AI to encroach on what is traditionally considered the practice of law. As AI tools gain capabilities to perform complex legal tasks, the industry faces a pressing need to define boundaries and implement robust safeguards.
Costs and Skills: The Changing Landscape
The report also sheds light on how legal professionals view the financial and professional implications of AI adoption. About half of law firms surveyed indicated they would absorb the costs of AI as part of their overheads. However, a quarter of respondents stated they plan to pass these costs on to clients, potentially altering client-lawyer dynamics.
Interestingly, the profession has not yet embraced AI as a critical skill for new entrants. Only 2% of law firms and corporate legal departments consider AI proficiency a requirement for junior lawyers. While 17% see AI skills as a desirable attribute, it’s not yet deemed essential.
A Global Perspective on Governance
AI’s rapid adoption extends beyond the legal industry, raising concerns about its societal implications. Recognizing the urgency for responsible AI governance, the International Bar Association endorsed the Council of Europe’s Framework Convention on Artificial Intelligence and Human Rights, Democracy, and the Rule of Law in October. This treaty aims to provide guardrails for AI adoption while safeguarding fundamental rights and democratic principles.
As AI continues to evolve, it is clear that its role in the legal profession will only grow. The integration of AI tools offers opportunities to streamline processes, improve accuracy, and introduce innovative billing practices. However, with these benefits come responsibilities. The legal profession must address confidentiality concerns, ensure the accuracy of AI-generated insights, and clearly delineate the boundaries of AI’s role in legal practice.
Sources Referred-
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