Survey shows clients want clearer AI governance from law firms, with transparency on data security and compliance practices
Law firms are being urged to demonstrate how they use artificial intelligence (AI) tools, following a recent survey by KPMG that highlighted how in-house counsel are increasingly focused on the role of technology in legal services.
The Global General Counsel Outlook 2026, published by KPMG, reveals that general counsel across various industries are prioritising technology, particularly AI, to drive efficiency and manage legal risks. As clients become more tech-savvy, they are demanding greater transparency from their external legal providers on their AI practices, including how data is managed and what safeguards are in place.
The findings, based on a survey of nearly 500 general counsel and senior legal leaders across 28 jurisdictions, show that in-house teams are already using AI in day-to-day operations and forming expectations based on that usage. Three-quarters of legal teams have already implemented AI use cases that are delivering measurable value. 70% of respondents use AI for research, while 65% employ it for compliance and regulatory monitoring. Additionally, contract management, board and executive reporting, and governance all had high rates of AI adoption.
“Adoption is no longer the real question – most legal teams are already experimenting with AI. The real differentiator will be how deeply those capabilities are embedded into workflows, governance and decision-making,” said Andrew Giverin, global legal business services leader at KPMG Law UK. He added, “The legal functions that lead will likely be those that use AI not just to work faster, but to rethink how legal insight is delivered across the enterprise.”
The survey found that general counsel are not only looking for law firms to use AI but are now expecting them to have clear governance frameworks for their AI use. As a result, external legal advisers are under increasing pressure to demonstrate transparency about their AI practices, particularly when it comes to data security and compliance.
The regulator’s heightened focus on AI’s role in legal services, combined with client demands for clearer oversight, means law firms must be ready to disclose their AI capabilities in proposals and pitches. Firms are expected to explain how they use AI tools, safeguard client interests, and ensure compliance with data protection and ethical standards.
The findings underscore the fact that AI is now deeply embedded in legal operations, with general counsel looking for law firms that can leverage these tools effectively to deliver not just speed but innovative, high-quality legal insights. Firms that can successfully demonstrate their AI use and governance will be well-positioned to meet the evolving demands of their clients.