HKU Finds Legal Firms Race to Adopt AI Amid Governance Gaps
HKU report shows legal firms rapidly use generative AI but lack proper governance.
Why it matters: Legal professionals must address governance gaps to manage risks like data breaches and AI errors. Robust AI policies ensure ethical, secure, and compliant AI use in legal workflows.
- 69% of legal professionals use general AI tools for work, up from 31% in 2025.
- Only 9% of law firms have enforced written policies governing AI use.
- 46% cite data security as a major barrier for AI adoption.
- 'Shadow AI' and unwatched workflow changes increase hidden risks in legal firms.
The Hong Kong University (HKU) LITE Lab’s research highlights a swift rise in generative AI adoption among legal firms while revealing alarming governance deficits.
According to the 2026 Legal Industry Report by 8am, 69% of legal professionals now use general-purpose AI tools for work-related tasks, a sharp jump from 31% in 2025. However, only 9% of firms have a written and actively enforced AI policy, underscoring a governance lag (DC Bar).
This mismatch puts legal data at risk. Almost half (46%) of professionals view data security as a critical barrier, especially since mainstream AI tools do not prioritize attorney-client privilege. Firms must scrutinize data storage, third-party access, and platform use to protect sensitive information (American Bar Association).
Experts warn the biggest threat isn’t reckless AI use but the gradual, unnoticed integration of AI into workflows—coined 'Shadow AI'—without governance or oversight. This invisible setup amplifies ethical and compliance risks (Nexos.ai).
Furthermore, fewer than 25% of enterprises overall have formal AI governance programs, according to the British Standards Institution, illustrating a broader industry challenge (BSI).
Brownstein Client Alert emphasizes that the critical legal risk today is not AI adoption itself but AI use without clear policies, human oversight, accountability, training, or risk controls (Brownstein). The HKU findings elevate this imperative, urging firms to act swiftly on building robust AI governance frameworks to harness AI’s benefits responsibly.
By the numbers:
- 69% — legal professionals using general-purpose AI tools for work tasks (2026 report)
- 9% — law firms with written and enforced AI governance policies
- 46% — legal professionals citing data security as a barrier to AI adoption
Yes, but: Some firms may not prioritize formal AI governance due to cost, complexity, or lack of awareness, risking unchecked AI use.
What's next: Legal firms are expected to develop and implement comprehensive AI governance frameworks throughout 2026 to mitigate risks and comply with emerging regulations.