A&O Shearman set out the next phase of its AI strategy in a press release on Thursday 5 November. Every practice at the firm must spend at least 3 per cent of its time building AI tools and services for its own area of law. This time makes up most of the value of the five-year commitment, the release said. The firm was formed in 2024 when Allen & Overy and Shearman & Sterling merged.

City AM reported that partners have approved the plan. The commitment equals more than 5 per cent of the firm’s annual revenue, which was $3.7 billion in the last financial year, the paper wrote. Artificial Lawyer puts the commitment at $220 million a year.

The sources describe the requirement differently. The press release refers to each practice’s time, while City AM writes about the practices’ billable hours. Legal Cheek reports that every lawyer must set aside at least 3 per cent of their billable time. Only London Daily News writes that most of the sum is partners’ time.

Legal expertise built into systems

Four years of experimentation have shown that AI benefits clients most in systems built for a specific area of law, the firm said. These systems embed the expertise of that area and can then be rolled out across the whole of it. Generic tools used the same way across the entire firm deliver less, it said.

One example is ContractMatrix, a contract tool for in-house legal teams that the firm built in 2023 with Microsoft and the legal AI platform Harvey. The firm says client use of ContractMatrix services has grown ninefold in 12 months. In September 2026, 96 per cent of its partners and 93 per cent of its lawyers used its AI tools, the firm said. The figures are the firm’s own.

‘This significant investment signals where we intend to take the firm over the next decade,’ Hervé Ekué, A&O Shearman’s global managing partner, said in the release.

Questions over how the figure was calculated

The press release does not explain how the $1.1 billion was calculated. Richard Tromans, founder of Artificial Lawyer, asks the same question. Tromans says an AI agent can be put together in Harvey in an afternoon, so Tromans cannot see what a billion dollars’ worth of working time would be spent on. The Artificial Lawyer founder also asks who tracks the time, what is measured and whether so much unbilled work will simply make the firm poorer. ‘It’s really a bizarre announcement,’ Tromans writes.

London Daily News calls the sum a notional figure. The cost is forgone billing, the paper says, because hours spent on development are not billed to clients.

Rival Freshfields signed a deal with Anthropic in April and rolled out Claude models to all its staff, 5,700 users, City AM reports. In May, Kirkland & Ellis was reported to be planning a $500 million investment in its own AI platform, Global Legal Post wrote.