AI is already being referred to as the third technological revolution – the rapid development of artificial intelligence (AI) is profoundly changing many areas of the economy and society. AI technologies not only promise to redesign everyday life or processes in companies, they will also revolutionize legal work, for example by automating repetitive tasks or preparing and analyzing extensive documents.
How widespread is the use of AI technologies in legal departments of German companies?
This question was asked in March/April 2024 on behalf of the Noerr law firm to those responsible for legal departments in leading German companies from a wide range of industries. In 100 interviews, questions were asked about the use of AI in the legal department, its opportunities and risks, and the consulting topics of the departments in this area.
The aim of this survey is to provide CEOs, managers and other decision-makers with a solid basis for assessing the potential of using AI in legal departments as an integral part of a future-oriented legal consulting practice that combines innovation and ethical responsibility.
Selected results are noteworthy:
- Currently, the potential of artificial intelligence in legal departments is not being fully exploited, only a quarter of the legal departments surveyed already use AI tools.
- Nevertheless, something is planned more than half the introduction of AI systems by 2025. The majority of AI tools will be used to analyze documents and texts as well as for document management.
- Almost two thirds of the legal departments surveyed expect the use of AI to reduce repetitive work, but only 42 percent expect direct cost savings.
- Two thirds rely primarily on AI tools when implementing them Standard solutionsonly 23 percent want to develop their own tools.
- However, most companies still have no budget
- One reason for the reluctance: two-thirds of the survey participants see the market for legal AI tools as still underdeveloped and complain lack of transparency.
- In addition, 42 percent see AI technologies as a Security risk
- Internally Many legal departments have already advised on AI issues, primarily on compliance matters and IP topics, but there is also increasing demand in other departments, such as HR.
- Guidelines for the use of AI in the company as well as training employees pose challenges for legal departments: only 15 percent of the companies surveyed currently have AI policies.
High need for advice
The topic of AI is already making high use of the resources of the legal departments surveyed. They are mostly entrusted with the topic of AI compliance, less frequently data protection officers or compliance departments
“From the respondents’ point of view, the introduction of AI tools is associated with high costs,” emphasizes study co-author Peter Bräutigam, partner in the Digital Business division at Noerr. “Above all, many legal departments still have to invest heavily in digitization – but that is the prerequisite for meaningful use of AI.” According to the survey, just 43 percent of legal departments consider themselves to have at least established digital maturity, and only 9 percent of them have a high degree of digitization.
There are also risks with regard to security – but these often result from the fact that AI is already being used, but there are no regulations governing its use within the company and especially the legal department. The use of AI that is tolerated in this way but not regulated by appropriate guidelines entails considerable legal risks, for example in relation to data protection, the protection of trade secrets or client confidentiality.
The first results of the survey were already presented at the Noerr Digital Day on May 13, 2024 in Munich. After the survey was completed, the results were summarized and evaluated by an interdisciplinary committee consisting of Peter Bräutigam, Georg Edelmann, Daniel Happ, Christoph Rieken, Daniel Rücker and Pascal Schumacher.
The complete results are available for download here.
