Medium firms (26-100 employees) sit at the centre of the legal market’s compliance evolution. They’re too large to rely on informal processes, yet not big enough to have the specialist departments of larger peers. This creates a delicate balancing act.

Legl’s State of Compliance 2025 report shows a group that’s adapting fast - every medium firm we surveyed made compliance changes in the past year - but often under heavy strain. Confidence is solid, despite time and capacity remaining constant pressures.

In this article, we’ll explore what our survey findings reveal about the state of compliance for medium firms in 2025.

To see the complete findings, download the State of Compliance 2025 report today.

Where medium firms excel

Medium firms often combine the best of both worlds – the responsiveness of smaller practices with the structure of larger ones. Indeed, our findings show a segment that’s moving with intent: adapting quickly, gaining confidence in their abilities, and building shared accountability throughout the firm. 

Leading the pace of change

According to our survey, no segment has been more active in responding to evolving AML and regulatory expectations. Every medium firm in our survey made at least one compliance change in the past 12 months – the only group where that figure reached 100%.

That responsiveness reflects both pressure and intent. Medium firms are often at the stage where growth brings greater scrutiny, but without the fully dedicated compliance infrastructure of larger peers. 

As a result, they feel regulatory shifts quickly and move quickly to adapt.

Cautious confidence

Medium firms are increasingly confident in their own capability. Forty-two percent say their compliance teams are fully equipped – the highest of any group. When asked “Which of the following are areas you’re actively developing within your team?” 68% point to strengthening regulatory knowledge, while 50% are focused on improving workflow design.

That mix of investment shows that medium firms aren’t getting ahead of themselves. While many feel fully equipped right now, they recognise that compliance teams always benefit from greater knowledge and better processes. Knowledge strengthens decision-making, while workflow design ensures it’s applied consistently.

The takeaway is a quiet but significant one: medium firms aren’t just reacting to regulation, they’re professionalising their response to it.

Balancing accountability and enablement

When asked what would most improve collaboration with fee-earners, compliance professionals at medium firms leaned heavily on accountability (23%) and training (38%). 

This suggests a shift in how medium firms view compliance. Rather than seeing it as a function owned by one team, they’re beginning to frame it as a shared responsibility that depends on clarity and capability across the firm.

It’s a subtle but important development. Compliance is moving from process to culture – built not just on systems, but on shared intent and mutual accountability.

Where medium firms struggle

While medium firms are the most active in adapting to regulation, high levels of activity doesn’t always translate into ease. Our survey showed that medium firms struggle with three recurring pain points: time pressure, tool fragmentation, and hesitation about where to invest next.

Managing fee-earner time pressure

Ninety-five percent of medium firms cite fee-earner time pressure as one of their biggest compliance challenges – more than any other group. It’s the cost of being caught between scale and structure. Compliance has grown into a shared function, but few medium firms have the dedicated support that large firms rely on.

Time-poor fee-earners are forced to juggle client-facing work with compliance demands. Ultimately, however, they’re judged on billable hours - meaning compliance duties often slip down their to-do list. 

This leaves compliance teams in a tough spot, trying to enforce consistency without slowing things down. 

Capacity under constant strain

For medium firms, the biggest barrier to progress isn’t intent or understanding – it’s bandwidth. Nearly three-quarters (74%) cite team capacity or budget as their main constraint on compliance operations. That’s almost double the rate for small firms (42%) and large ones (42%).

It’s a revealing statistic. Medium firms are large enough to face complex, high-volume compliance demands, but not yet big enough to have the dedicated resources to absorb them. 

The result is constant tension – a push to keep up with regulatory expectations while juggling growth and delivery.

A need for better technology

Medium firms are the most eager to strengthen their technology foundations. When asked what kind of support would most increase their impact over the next 12 months, 68% pointed to stronger tools and integrations – compared with 50% of small firms and 40% of large ones.

That response captures a familiar tension. Medium firms already use a range of systems, but in many cases, these might have been adopted reactively to meet immediate needs. What they now want is cohesion – technology that connects rather than complicates.

The demand isn’t necessarily for more software, but for systems that talk to one another. Firms at this stage understand that efficiency and visibility come from integration, not accumulation. 

Final thoughts

Medium firms are at a turning point. They’ve moved past the stage of simply reacting to change and are beginning to consolidate their compliance function – joining up systems, roles, and responsibilities that have evolved quickly over the past few years.

The data shows both strain and strength. Medium firms are adapting faster than anyone else, with constant activity, cautious confidence, and a clear appetite for improvement. However, they’re still searching for the capacity and cohesion to make that progress truly sustainable.

To learn more about the state of compliance for law firms in 2025, download our full report.