AI and LegalTech Revolution

Watch: An In-House Counsel View of AI

Rishi Gautam, Global GC, Tata Consumables

Throughout this year's research for the APAC guide, it has been clear that artificial intelligence (AI) is already making a considerable impact on the work and management of law firms and in-house teams.

Interviewees have highlighted that, while new technologies have the potential to bring greater efficiency and cost savings, they also present challenges to organisations and law firms as they attempt to keep up with the pace of change. Many in-house lawyers have highlighted the impact of AI as a key factor shaping the procurement of legal services.

In-house teams are already adopting AI tools for internal work processes. They report that these save time and money by reducing the need to send more routine work to external counsel. These changes are already gathering pace in many organisations.

“As we speak, AI tools are helping us with document review, legal research and basic drafting. And I must admit that it is already saving a considerable amount of time as well as costs that we incur on going out to external lawyers."

Rishi Gautam, Global General Counsel, Tata Consumer Products

Despite the huge potential of AI, both in-house counsel and law firms also stress the need to strike a careful balance when adopting these new technologies. Ultimately, rigorous oversight by legal teams remains key.

Whilst transforming their own legal departments, GCs are also increasingly looking to understand how well law firms are using AI tools when instructing external counsel. As one source taking part in our Singapore research explained: "The use of AI to speed up work and reduce resources is an important evaluating criterion in choosing and engaging external lawyers. Law firms that adopt AI to reduce the time costs of the team for a transaction would be top of the list.”

Law firms across Asia-Pacific have reported investing in AI tools to keep up with this trend.However, others prefer a wait-and-see approach, bearing in mind both the high cost of AI solutions for the smaller law firm, and the desire to carefully evaluate what the most effective option may be.

The rapid adoption of AI is also starting to drive an increase in compliance work for both in-house teams and their external counsel, as markets across Asia-Pacific look to introduce new legislation and guidance. As one source this year explained: “As AI adoption accelerates across industries, businesses must navigate emerging legal and regulatory frameworks governing AI-driven decision-making, data privacy and intellectual property rights. Legal guidance will be essential to ensure compliance with evolving AI regulations and mitigate liability risks related to automated processes.”

Overall, the impact of AI is still emerging in APAC, and we expect to see further changes within the legal sector as law firms and businesses adapt and capitalise on the opportunities and risks it poses.