Milad Shojaei investigates the global trends in legal tech and the UK’s role within it. With regions across the world endorsing greater reliance on technology and automation, it is vital that the UK is ahead of the curve. Exploring what our counterparts are doing right, can tell us much about what we are doing wrong.
Technology has changed the face of everything, and the law is no exception. Law firms worldwide are employing digital strategists and embracing the benefits of legal tech. As the technological revolution takes hold, the question beckons, are the tides changing at the same pace globally? All justice systems are facing the same problems and tech startups have delivered many of the most innovative solutions. However, they face resistance from the conventional operations the sector has come to know and overcoming this is a common challenge endured by many legal departments globally.
The global response
Developments in technology have transformed the legal practice in obvious ways. Law firms that have historically distanced themselves from the pace brought about by tech startups have now embraced technical solutions and improved efficiency. With this said, the developments behind legal tech have been different in application across regions. The US marks the home to most of the legal tech startup industry for decades. Despite the profession still being conservative in itself, US law firms are embracing disruptive innovation and employing technology to meet growing demands. To keep up, Europe has made great strides in progressing its technological developments and offers one of the most advanced legal tech industries in the world. Israel makes a notable contribution to this. The country is quickly establishing its ability to dominate many high-tech fields in only the last few years. It intends to keep up with the rest of the world but faces severe challenges. Many legal professionals in Israel are reluctant to adopt new technologies. This is a common obstacle shared by the legal tech industry in the UK.
Is France driving legal tech forward at the UK’s expense?
France is also a key player. Though far from achieving the levels of development in the US, the French legal tech market has experienced significant growth in recent years. France has managed to deliver an exceptional increase in interest from investors with a new record of €52.1m raised in 2019. Why has progress in the legal tech industry surged in the region? Unlike Israel and the UK, where startups struggle to change the conventional operations favoured by legal professionals, french lawyers have reacted by driving forward the global push towards the digitisation of their industry. Despite adopting a reluctant approach during the earlier stages of legal tech integration, their legal professionals have now widely acknowledged the importance of new technologies. The future of innovation looks positive for France as they continue to react to change effectively and take steps to reshape their sector, driving forward business efficiency and productivity as core values.
Is the UK doing enough to keep up?
Research by Intapp has submitted that not enough UK Law firms are deploying new technologies. The report found that fewer than 50% of law firms in the UK were using automation tools. Moreover, according to the data from the 2018 Sharplegal Report released by Acritas, American legal departments are more likely to use new legal technologies. The report further outlines that 25% of UK legal departments are not using any technology, as compared to 11% in the US. Further, new research from Dell Technologies has also discovered that businesses in the UK are generally trailing behind 12 other global countries. The UK legal department has always resisted innovation, and this is especially visible when we make comparisons on a worldwide scale. Has the UK fallen behind?
Despite the alarming reports, there is cause for hope. In 2018, British law firms doubled their investment in digital solutions. Investment into UK law tech startups also increased, from £2.5 million in 2016 to £62 million for the first three-quarters of 2019. Various magic circle firms have all launched their own in-house innovation development hubs, and others have established incubators to invest in the next generation of law tech businesses. So what more needs to be done? It is vital to encourage the complete overhaul of the sector’s traditional operations. Also, legal tech is currently focussed on delivering services that solve specific legal issues, and it is challenging to deploy these within corporations on a larger scale. The legal sector must commence a change in approach by taking greater steps in investigating the capability of technology to solve more significant challenges such as legal automation. Law firms should also facilitate this as they continue to invest in legal software and innovation departments.
Legal tech education
There has generally been a theme in the UK that there isn’t enough legal tech education to facilitate the widespread use of new technologies, and that law schools need to do more to stay ahead of the curve. The Law Society has found in a study that young lawyers are amongst the most technophobic of legal professionals. Statistics suggest that some 50% of junior lawyers are not aware of legal tech at all. Although most junior lawyers embrace the potential benefits of technology, not enough is being done to fill the skills gap.
The US has undoubtedly benefited from nurturing legal tech education. In 2012, the American Bar Association made significant changes to the Mode Rules of Professional Conduct, placing a duty on lawyers to be competent not only when practising law but also in understanding the application of technology. Further, North Carolina is the second state to mandate continuing education and training in technology. This, alongside the 21 educational establishments that are teaching legal tech courses, indicates where the priorities lie within the US judicial system.
Similar developments have taken place in Australia. The Law Faculty at the University of Technology in Sydney have launched a Bachelor of Laws degree in Legal Futures and Technology to prepare graduates for careers that will require familiarity with innovation and emerging disruptive technologies. Does the UK meet legal tech education needs? The University of Law has provided a host of new courses in legal technology, and some universities have got to terms with the new approach that the legal training needs to be a step ahead to meet new technologies disrupting the delivery of legal services. This suggests that although the legal education market in the UK has been slow to adjust to the demand, it is picking up with institutions paving the way for systematic change across the board. But is it enough? Technical solutions are fast approaching in light of recent changes brought about by the pandemic and recent developments. Unless the UK takes more meaningful steps in prioritising legal tech education, we will surely see a skills gap in the coming years.
Professor Richard Susskind, IT adviser to the Lord Chancellor
Where do we go from here?
Technology has the potential to transform the legal order. The tides are turning at different speeds worldwide as each country seems to support varying degrees of acceptance toward innovation and its practice within the legal sector. As the legal tech community expands, regions are likely to learn from each other. We are likely to see momentous progress in the coming years, in light of the recent developments in technology and the wake-up call instigated by Covid-19. Technical solutions that can reshape the law are already here, and lawyers around the world have started to embrace the disruption to the industry by introducing heavier tech competence into legal practice. To avoid falling behind, it is vital to react to technological disruptions appropriately and to implement more considerable resources to the overall application and education of legal tech.