The Brief:
82% of GCs globally now expect law firms to clearly explain how they use AI, and firms that can't are at risk of losing ground.
AI adoption is broad in in-house legal teams, but most admit AI execution still has a way to go.
In-house legal teams have moved past the question of whether to use AI. Now they're bringing AI scrutiny to law firms.
KPMG’s 2026 Global General Counsel Outlook surveyed nearly 500 GCs and senior legal leaders across 28 jurisdictions. The findings are clear: AI is already embedded in legal functions globally — and GCs are done waiting for their external firms to catch up.
Three-quarters of in-house teams have already deployed AI delivering measurable value. 70% use it for legal research. 65% for regulatory and compliance monitoring. Adoption is broad.
But the expectations don’t stop at the in-house door.
82% of GCs now expect law firms to clearly explain how AI is used in their work. 66% have an increased focus on tech-advanced services. Firms that can’t demonstrate how they’re using AI will risk being replaced by firms that can.
The billing conversation is shifting too.
87% of GCs prefer value- or outcome-based pricing over the billable hour. The logic is hard to argue with — if AI is cutting the time it takes to do the work, clients want the fees to reflect it.
But it’s not all confidence on the in-house side either.
65% of GCs are still concerned about AI accuracy. Only 26% strongly agree that success metrics for AI integration are well-defined and tracked in their organisations. Just 25% believe their tools are actually built for their team’s specific workflows.
In a market where every firm claims to use AI, the ones who can prove it will be the ones clients keep calling.