Legal departments spend most of their time handling data privacy concerns, according to “The General Counsel Report 2025” report released by FTI Consulting, Inc. and global tech company Relativity.
Part one of the report revealed that this was the case for 61 percent of legal departments; meanwhile, 58 percent reported that responding to incidents like data breaches took up most of their time.
Eighty-eight percent of respondents expressed concern about the risks of emerging data sources like collaboration applications, linked content and cloud productivity platforms. Of these, 59 percent said they were highly or extremely concerned. Sixty-five percent said they were little to not prepared to tackle emerging data source-related issues; 57 percent said they had already encountered new compliance challenges related to such data sources.
“Data privacy and data protection lead the way as regulatory risks, and, in the era of rapid change, an overwhelming majority predict risk to increase at an even faster rate,” said David Horrigan, Relativity’s discovery counsel and legal education director, in a statement. “Not surprisingly, with new governments in the UK and the United States, we saw a substantial increase in chief legal officers reporting regulatory compliance as a major risk.”
Forty-one percent of general counsel considered regulatory compliance their top risk – an increase of 11 percentage points compared to the previous year. Forty-four percent of general counsel reported they closely followed privacy regulation in non-US jurisdictions, 35 percent the EU AI Act, and 35 percent other artificial intelligence regulation in non-US jurisdictions.
Increased complexity and data and stricter regulations have also contributed to an uptick in the cost of disputes and investigations, according to 50 percent of general counsel. Internal investigations were a primary driver of disputes and investigations activity for over a third of respondents, while 25 percent pointed to whistleblowers.
Over 75 percent reported that they relied more on law firms to tackle expanding risks than in the previous year (63 percent), with 85 percent of general counsel anticipating a rapid boost in corporate risk and legal department demand in the coming year.
“Through an increasing openness to technology, a focus on business objectives and reliance on strategic expert partners, most general counsel have struck a realistic balance between absorbing increased risk and fueling growth within their organizations,” said Sophie Ross, FTI Technology global chief executive officer, in a statement. “Given the current fluidity across business, technology and regulatory environments, general counsel will need to maintain this careful balance and prioritize adaptability across the evolving landscape of data-driven challenges.”
“The General Counsel Report 2025” surveyed 207 general counsels in 12 countries in September 2024. In July and August 2024, Ari Kaplan Advisors conducted 34 one-on-one interviews with chief legal officers and general counsel at major global corporations.
Part two of the report will be published next month.