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A&O Shearman lawyers ordered to sacrifice billable hours to build AI tools
A&O Shearman will invest $1.1bn (£816m) over five years in its artificial intelligence strategy, committing more than 5 per cent of annual revenue. The Magic Circle firm says the investment will change how it delivers legal work and trains staff, and help it compete by combining legal expertise with AI’s speed and scale.
Each practice will be expected to devote at least 3 per cent of its billable hours to developing specialist AI tools and services. The firm says its four years of testing showed the strongest results when lawyers with deep expertise in a field help build systems tailored to that area. A&O Shearman reported $3.7bn (£2.8bn) in revenue in its latest financial year; rival Freshfields has also expanded its AI use through a deal with Anthropic.
In short
- A&O Shearman is investing $1.1bn in AI over five years.
- Each practice must spend at least 3% of billable hours on AI tools.
- The firm says specialist legal expertise is key to effective AI systems.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Requiring lawyers to spend some billable time building specialist AI tools could make those tools more accurate and useful, because practitioners understand the legal work they are meant to support. A large, sustained investment may also help the firm serve clients more efficiently and keep its expertise competitive as other firms adopt AI.
The case against
Taking time from client work to develop AI tools carries an opportunity cost, and it may be difficult to know whether the investment will deliver enough value to justify its scale. Some may also question whether lawyers’ time is best spent on tool development, given the need to maintain client service and provide training as the technology changes legal work.