What's Happening?
A recent report by KPMG, titled the '2026 KPMG Global General Counsel Outlook,' reveals that a significant majority of general counsel (82%) expect their law firms to be transparent about their use of artificial intelligence in client matters. This expectation
is seen as a key indicator of AI caution among legal professionals. The report, which is based on a global survey of 468 general counsels and senior legal leaders conducted in late 2025 and early 2026, emphasizes that law firms are now evaluated not only on their legal expertise but also on how effectively they deploy, govern, and explain the technologies supporting their work. This shift reflects a growing demand for transparency and accountability in the use of AI within the legal industry.
Why It's Important?
The findings of the KPMG report underscore a critical shift in the legal industry towards greater transparency in the use of AI technologies. As AI becomes increasingly integrated into legal processes, clients are demanding more insight into how these technologies are used in their cases. This demand for transparency could lead to significant changes in how law firms operate, potentially affecting their competitive edge and client relationships. Firms that fail to meet these expectations may risk losing clients to more transparent competitors. Additionally, the emphasis on AI governance and explanation highlights the need for law firms to invest in AI literacy and compliance, ensuring that their use of technology aligns with ethical and legal standards.
What's Next?
As the demand for AI transparency grows, law firms may need to develop new policies and practices to track and disclose their use of AI in client matters. This could involve creating detailed reports or dashboards that provide clients with insights into how AI is being used in their cases. Additionally, firms may need to invest in training programs to enhance their staff's understanding of AI technologies and their implications. Regulatory bodies may also begin to establish guidelines or standards for AI use in the legal industry, further shaping how firms approach AI transparency and governance.
