UK Public Given Opportunity to Provide Input on Litigation Funding

A recent report has uncovered what the UK public thinks about third-party funding and which funder fees they find acceptable. The report, titled “Reputation and Accountability: Class Actions, ESG and Values-Driven Litigation,” sheds light on the rise of ‘values-driven litigation’ and its impact on corporate responsibility.

The study, conducted by Portland Communications, surveyed 2,000 people and 540 business leaders in the UK to gauge their perceptions of class actions, ESG-related claims, and securities litigation. These forms of litigation are often seen as ‘values-driven’ due to their moral or ethical objectives. The report explores how these legal actions are being used to hold companies accountable and push for better corporate standards.

When it comes to litigation funding, the report found that while many now accept the role of third-party funders, a large majority (81%) believe that class actions mainly benefit funders and lawyers financially. However, the public is becoming more comfortable with the idea of funders supporting class actions and sharing in the damages awarded. Interestingly, fewer people now believe that all compensation should go directly to those affected, dropping from 66% in 2023 to 46% this year.

As for funder fees, most respondents (25%) consider doubling the initial investment to be a fair fee, with a notable increase in those who believe a funder receiving 10 times their investment is acceptable, rising from 6% to 15% in the past year.

The report also revealed that awareness of class actions is on the rise, with 24% of respondents claiming ‘high levels’ of awareness in 2024 compared to 19% the previous year. Despite this, only 23% of those surveyed have participated in a class action, though 65% said they would join one if given the opportunity.

Additionally, many believe that class actions often result in compensation for those affected (57%), hold companies accountable (56%), and drive improvements in corporate behavior (50%). However, many are unaware of their eligibility to claim damages in high-profile cases, with only 22% believing they are eligible for compensation in claims before the Competition Appeal Tribunal (CAT).

Overall, the report highlights a growing trend of values-driven litigation in the UK and emphasizes the importance of companies prioritizing accountability and transparency. Business leaders also expressed their support for legal action to address climate risks and human rights violations within companies. Furthermore, a majority of respondents believe that securities litigation is a necessary tool to hold companies accountable for misleading information and to promote better governance.

These findings illustrate a shifting landscape in how the UK public views litigation funding, class actions, and the role of legal actions in driving positive change in corporate behavior.