Stewarts Contributes to Portland’s Latest Report on Reputation and Accountability

Portland, a communications and advisory firm, has recently released its 2024 report, shedding light on the UK’s views and engagement with class actions, ESG, and securities litigation. The report is based on surveys conducted with the UK public and over 500 senior business decision-makers, aiming to explore the impact of these legal proceedings on reputation and corporate governance standards.

According to the report, public awareness of class actions in the UK has seen a notable increase, although this has not necessarily translated into a higher willingness to participate in these actions. Interestingly, while faith in the positive outcomes of class actions has grown, many still believe that lawyers and litigation funders benefit the most. Additionally, there is a low awareness among the public regarding eligibility for compensation in high-profile competition claims, despite a keen interest in participating in such cases.

Senior business decision-makers in the UK are acutely aware of their responsibilities to address climate risks and the potential legal repercussions from shareholders if they fail to do so. Lorraine Lanceley, a partner at Stewarts, shared insights in the report on the role of securities litigation in enhancing corporate conduct and its use in holding companies accountable for broader ESG shortcomings.

Lanceley’s commentary underscores the positive perception the UK public has of securities litigation as a tool to drive better corporate behavior. More and more shareholders are willing to take legal action against companies for governance lapses, with a significant percentage supporting such measures. Notably, the report indicates a growing willingness among the public to divest shares from companies that fall short on governance standards, reflecting a heightened focus on accountability.

The report also highlights an increasing trend in UK investor litigation, wherein shareholders are seeking compensation for governance failures through lawsuits. The availability of litigation funding has made it more feasible for such claims to come to fruition, thereby reinforcing the efficacy of securities litigation as a governance mechanism.

While class actions in the UK do not follow the opt-out approach seen in the US, investor protection remains a key objective of securities litigation. Despite cases settling before reaching trial, investors have been compensated through negotiated settlements. This, in turn, has not deterred the public’s support for securities litigation, which embodies a strong desire for holding companies accountable, particularly concerning ESG issues.

Overall, Portland’s report provides valuable insights into the evolving landscape of class actions, ESG, and securities litigation in the UK. As public sentiment leans towards increased shareholder activism and accountability, the role of litigation in shaping corporate behavior and governance standards continues to be of paramount importance.