Many law firms are already using or testing AI products internally, but there is still some trepidation about using them directly on client matters. According to Thomson Reuters’ 2024 Future of Professionals report, 46% of law firm respondents said they don’t feel very confident about articulating AI value to clients. This may be borne out of concerns around the impact on the billable hour and what this will mean for pricing models in the future as work is completed faster.
Yet the potential benefits are huge, given that lawyers can be freed up to spend more time on higher-value work. With this in mind, Thomson Reuters’ head of legal professionals for Europe, John Shatwell, discusses how law firms should approach communicating with clients over AI use to ensure ongoing trust.
How much information should firms give clients about their AI use?
A firm doesn’t generally require a client’s consent to use AI tools. In fact, 71% of clients don’t know if their law firm uses GenAI or not, according to the 2025 Thomson Reuters GenAI in Professional Services report, but there’s no reason at all why a law firm shouldn’t be vocal about its AI use. When there’s clear communication and transparency between the law firm and its client, trust is built. Be clear about exactly what work will be carried out and, as far as possible, how it will be done to avoid potential misunderstandings. Some clients may prefer their law firms not to use AI, which is why open and transparent communication remains essential.
Clients generally will appreciate it though, because they’ve been asking law firms for a number of years to demonstrate how they are using tech in the delivery of legal services. Our research shows that in-house lawyers are more likely to be innovators and early adopters of AI than their counterparts in law firms. So, with clients adopting and using AI already, there is an expectation that law firms should be using AI as well to be more efficient, deliver greater value overall and provide their clients with more strategic guidance. It will get to the point that AI use will be so ubiquitous that it won’t be a topic of discussion – it will just be the norm.
It will get to the point that AI use will be so ubiquitous that it won’t be a topic of discussion – it will just be the norm
How can firms best reassure clients about any concerns they may have around AI risk?
The biggest client concerns are typically related to security and accuracy; they usually impose specific information security protocols on the use of technology they purchase and even technology that law firms deploy in their work. Law firms need to be clear about the treatment of any client data that is fed into an AI tool, where it’s hosted and whether it’s reused. That’s why it’s essential law firms use a professional-grade AI legal assistant such as CoCounsel from Thomson Reuters because it doesn’t use any customer data to train its models.
When it comes to accuracy, there’s not a generative AI tool that can assert to be 100% accurate, but nor can a human for that matter. We view an AI legal assistant like CoCounsel as augmenting, not replacing humans, so it’s important there’s a verification process. The verification process for the majority of tasks will take far less time than doing the work from scratch, and that delta is where most of the value lies. Clients will want reassurance that the output is checked and verified by a legal professional, and so my advice for law firms using AI is: ‘Trust, but verify’.
How can firms best demonstrate the value of using AI on client matters?
First and foremost, it should be about showing how effective a law firm is in serving the client and how it is making clients happy. Has the law firm been able to serve its customers more promptly and efficiently with faster response times and improved communication? If firms are using AI correctly to automate routine legal tasks, that means lawyers are then free to pioneer new ways to serve their clients. With firms concerned about a reduction in fee income arising from GenAI, we see firms having developed, or being in the process of developing, value-add services to help differentiate them from their peers, which allows them to retain or even grow their current margins.
You mentioned concerns about reduced fee income. What impact will this have on pricing models, and how should firms manage this?
AI is going to provide significant time savings for law firms by reducing time spent on certain administrative tasks. Research by the Thomson Reuters Institute suggests GenAI could save around 200 hours per year, per lawyer. As a result, the billable hour will likely become a less effective measure of value.
Therefore, over time, law firm pricing models will evolve to reflect the outcomes delivered to clients rather than the inputs i.e. lawyer time. That’s going to mean a significant change in law firm business models. This change won’t be linear; it will rather emerge in certain practice areas before others. For example, we see litigation practices as likely to be slower to move to this model than transactional or advisory work. However, I think many law firms are preparing for this change by partnering with organisations like Thomson Reuters to invest in AI technology along with evaluating the talent that they have and will need in order to take advantage of these market shifts.
To ensure the value that lawyers bring to the client is truly understood, we’re seeing law firms invest heavily in these relationships. For example, we see firms developing bespoke solutions and expanding their consulting capabilities. This means that, instead of reduced billings because of AI, law firms can expect to increase billings for innovative, intellectually satisfying, high-value strategic work that can now be done by freeing up those 200 hours. Therefore, the more efficient a law firm becomes at utilising AI, the greater its profit is going to be.
To what extent should firms consult with clients when developing use cases for AI?
Law firms absolutely should consult with their clients. The most successful law firms that we partner with are already hugely collaborative with their clients in developing tech-based solutions and workflows, and that trend will only accelerate with GenAI.
Many law firms are already using or testing AI products internally, but there is still some trepidation about using them directly on client matters. According to Thomson Reuters’ 2024 Future of Professionals report, 46% of law firm respondents said they don’t feel very confident about articulating AI value to clients. This may be borne out of concerns around the impact on the billable hour and what this will mean for pricing models in the future as work is completed faster.
Yet the potential benefits are huge, given that lawyers can be freed up to spend more time on higher-value work. With this in mind, Thomson Reuters’ head of legal professionals for Europe, John Shatwell, discusses how law firms should approach communicating with clients over AI use to ensure ongoing trust.
It will get to the point that AI use will be so ubiquitous that it won’t be a topic of discussion – it will just be the norm
