Is AI the answer to compliance? The Practice Manager’s view
Tuesday 11 July, 2023
To discuss your requirements for legal software, please click to book an online demo or contact us on 01252 518939 info@insightlegal.co.uk
Tuesday 11 July, 2023
To discuss your requirements for legal software, please click to book an online demo or contact us on 01252 518939 info@insightlegal.co.uk
As we’ve already covered in previous blogs, AI is being touted as a magic solution for efficiency in the legal sector – with over half of lawyers saying that ChatGPT should be used in legal work. Yet while its benefits on efficiency and cost savings are well-explored, could AI really be the answer to compliance?
Here, we explore AI for compliance from a Practice Manager’s perspective.
First things first. ‘Real’ or ‘True’ AI is artificial intelligence that can learn, adapt, make judgement calls, create new rules, and make decisions in unfamiliar scenarios. That isn’t here yet, but it’s coming
However, aspects of AI (especially advanced automation) are already in wide use, and they’re a gift to law firms, especially in compliance. Compliance is about following sets of rules, and rules are bread and butter for machine intelligence. One firm at our recent Practice Managers’ breakfast reported how using AI has relieved a huge administrative burden in areas of their firm and allowed them to take on more fee-earning work.
Not every Practice Manager is as enthusiastic about the prospect of AI, and their reticence is understandable. The legal industry is built on precedent, reliability, and confidence. Sudden innovation and relatively untested technology can appear to threaten those things. Law is a very human line of work with very human consequences — what business do machines have handling it, and can we trust them to do things the right way, especially for something like compliance?
Attitudes vary. Some firms are sceptical about (or even hostile to) AI, and some have adopted its new tools enthusiastically. When it comes to compliance, which side tips the balance of risk vs reward?
When you have a programme that’s capable of working faster than a human, for longer than a human, and more accurately than a human, then there’s enormous potential. Add to that the ability to match or at least approach human-level decision-making, then the compliance possibilities seem endless.
The savings in time and money are the most obvious. It could free people to concentrate on the creative and empathetic work in the firm, the real ‘art’ of law or practice management, while routine compliance tasks are managed by AI.
AI will also aid human understanding of compliance obligations, how they apply in a specific scenario, and the best action to take. Solicitors and Practice Managers will need to sense-check AI’s recommendations and decisions, but the software will offer much more data and far more ‘answers’ to questions of compliance.
One Practice Manager recently told us: “We’ve introduced five bots in the firm, and they haven’t replaced any jobs. What they have done is increased our capacity to take on additional fee-earning work. Despite initial concerns, our teams have come to accept and appreciate the positive impact of AI.” If AI can take on some of the more time-consuming compliance, it could boost efficiency and profitability.
On the one hand, AI will be helping firms stay compliant, and on the other, it will create compliance demands of its own – with bias potentially posing a serious threat to effective compliance. As Paul Hobden, Insight Legal’s Managing Director, commented in a recent interview: “While I believe many of the current compliance requirements will be easier to manage and easier to audit, AI is going to throw up an array of new ethical and compliance issues. For instance, who audits your AI algorithm for bias?’
We train AI on data, and data is something we associate with objectivity, but data sets can easily contain human bias. AI could easily scale up that bias through machine learning, and very quickly the firm could commit serious discrimination through its AI. One of the most famous examples of that is when Amazon had to shut down its AI recruitment tool because it developed a prejudice against women.
Experienced members of staff have and will continue to have experience of compliance pre-AI. Eventually, though, employees who started their careers as ‘AI natives’ won’t necessarily have the compliance skills to ask the right questions and ‘challenge’ AI. It may not be a huge problem — skills and requirements adapt to the technology of the time — but it could risk creating a generation of solicitors and Practice Managers who don’t truly understand the basics of compliance.
If AI-powered compliance becomes the norm, there’s a danger that it becomes a crutch that firms lean on too heavily. It will be extremely powerful, but even when it reaches the height of its powers (whatever that may be), it needs to be treated as a tool, not an authority.
ChatGPT might be considered the ‘face’ of AI at the moment. There’s even a law-specific version. Chatbots have stirred a lot of excitement as well as fear — ChatGPT’s own creator wants it regulated for our protection.
Aside from future existential threats, the immediate risk is that a solicitor could ask AI to prepare a document or perform compliance work, see the result and feel that it was acceptable, and not check it thoroughly enough. That is a timebomb for compliance.
Is AI a compliance opportunity or liability? Join the discussion with other Practice Managers over on LinkedIn, where you can share your thoughts on the impact of AI on compliance – and how you think it might affect your firm in the future.
Insight Legal’s software supports thousands of Practice Managers by streamlining compliance, case management, tax, time recording, and much more. To find out more about creating more efficient processes, visit https://www.insightlegal.co.uk/solicitors-software/.