General Counsel and chief legal officers are navigating a moment of rapid change and rising pressure in 2025. Their roles are expanding to manage risk at an “unparalleled pace“. This includes addressing data protection, AI opportunities and AI legal risks.
They are strategically positioning themselves as business protectors and “data guardians in chief“. While increasingly open to generative AI (GAI), General Counsel face significant concerns about its ethical use and impact.
Disclaimer: To capture the broader industry direction and forecast the challenges arising in Australia, we have utilised global sources in this article. Complete list of references in the footer notes of this blog.
Top AI Concerns for General Counsel
General Counsel have identified several critical areas of concern regarding AI in 2025, moving beyond early fears of job loss to more nuanced challenges. (Source: Future of Professionals Report 2025)
1. Undetected Hallucinations and Inaccurate Results
This is the top-ranked concern for General Counsel, at 35%. There are “horror stories” of AI generating fake cases that lawyers then present in court. Lawyers must rigorously review and oversee the output of AI tools to ensure compliance with professional ethical standards.
A significant majority, 91% of professionals, believe computers should be held to higher accuracy standards than humans. Importantly, 41% said AI outputs need to be 100% accurate before use without human review. (Source: Future of Professionals Report 2025)
Human review of AI outputs is therefore critical.
2. Data Privacy and Security
This remains a paramount concern for legal professionals handling sensitive information. Failures in this area can lead to reputational damage and legal consequences.
Over half of the surveyed legal professionals believe AI tools could compromise attorney-client privilege. (Source: docket.acc.com)
Safeguards include clarifying internal guidelines for AI use, vetting vendors for data retention policies, and exercising caution with sensitive information on public models. Cybersecurity is described as a “paramount risk”.
3. Bias and Ethical Issues
General Counsel are concerned about bias in AI. AI systems must be regularly audited for bias, especially when they influence areas governed by anti-discrimination law. (Source: docket.acc.com)
Practices like testing for demographic skews, systemic exclusion, and unfair patterning in decision outputs are crucial. Using diverse and representative datasets helps mitigate bias. Ethical considerations also include transparency and accountability.
4. Explainability Limitations / Black Box AI
General Counsel worry about the inability to understand how AI reaches its conclusions. The key to ethical AI use is ensuring that decision-making processes are transparent and reviewable. Organisations should avoid “black box” algorithms.
“A black box AI is an AI system whose internal workings are a mystery to its users. Users can see the system’s inputs and outputs, but they can’t see what happens within the AI tool to produce those outputs.”
Source: IBM, What is black box artificial intelligence (AI)?
5. Regulatory Compliance
Governments and regulatory bodies are quickly introducing laws to govern AI usage, with more expected in 2025. The EU’s AI Act outlines “stringent requirements” for transparency, accountability, and data protection.
Legal teams must proactively adapt to these standards. Accountability is a guiding principle, meaning responsibility must be traceable, preventing justifications like “the algorithm made me do it”.
In-house counsel should champion ethical standards that go beyond minimum compliance, especially in jurisdictions with looser laws.
6. Human Oversight and Judgment
Attorneys “may not abdicate their responsibilities” by relying solely on GAI tools for tasks requiring professional judgment. AI should “augment, not replace, human judgment”, particularly in high-consequence settings. (Source: Ethical Considerations for Generative AI Technology)
General Counsel emphasise the need for appropriate controls and sufficient oversight, with “someone needs to review all of the output”. Over-reliance on technology could also crimp professional skill development.
7. Cost of Tools and Upskilling Teams
The cost of AI tools and the need to upskill or cross-train teams to use the technology are also concerns for General Counsel.
Broader Context for General Counsel in 2025
The legal sector’s relationship with AI is still in its early stages. While many legal professionals are embracing AI aas a transformative force and are optimistic about its positive impact, a significant gap exists in preparedness. Three out of four legal departments lack a technology roadmap. General Counsel need to close the AI Readiness Gap.
This is described as a “personal pain point” for General Counsel. General Counsel are in a unique position to shape how their organisations adopt AI: thoughtfully, securely, and with clear outcomes in mind. Their role is essential at the junction of legal, ethical, and strategic decision-making.
Resources Referenced in This Post
- “2025 General Counsel Survey Report.” (Report) Available at: https://ftitechnology.com/spotlight/gc-report-2025
- “2025 Legal Trends: AI Becomes a Competitive Advantage.” (Article). Available at: https://www.lexitaslegal.com/resources/2025-legal-trends-ai-becomes-an-advantage
- “ACC: The Hot Seat – Ethical Issues GCs Face (April 17, 2025).” (Online Learning Event). Available at: https://onlineed.acc.com/products/the-hot-seat-ethical-issues-gcs-face-april-17-2025
- Carino, Serene E. “Ethical Considerations for Generative AI Technology – Farrell Fritz.” Farrell Fritz, November 1, 2024. (Article). Available at: https://www.farrellfritz.com/insights/legal-insights/ethical-considerations-for-generative-ai-technology/
- Cannon, Hope. “How general counsels are stepping up as unlikely AI champions.” Diligent, May 23, 2025. (Blog Post). Available at: https://www.diligent.com/resources/blog/general-counsel-ai-champion
- “How AI is transforming the legal profession (2025).” Thomson Reuters, January 16, 2025. Available at: https://legal.thomsonreuters.com/blog/how-ai-is-transforming-the-legal-profession/
- Burnside, Lauren. “How AI, Data, and Collaboration Are Reshaping Legal Ops in 2025 – Today’s General Counsel.” Today’s General Counsel, March 21, 2025. (Article). Available at: https://todaysgeneralcounsel.com/how-ai-data-and-collaboration-are-reshaping-legal-ops-in-2025/
- Association of Corporate Counsel. “How Corporate Counsel Can Balance Innovation with Oversight in the Age of AI | ACC Docket.” ACC Docket, June 2, 2025. (Article). Available at: https://docket.acc.com/how-corporate-counsel-can-balance-innovation-oversight-age-ai
- “How to Bridge the Legal AI Expectations Gap.” Lexitas, October 31, 2024. (Article). Available at: https://www.lexitaslegal.com/resources/legal-ai-expectations-gap
- Thomson Reuters. “Future of Professionals Report 2025: Strategic AI Adoption: Unlocking Innovation and Maximizing Returns.” (Report), 2025. (PDF Document).
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