Six Trends Shaping Class Action Risk In Australia In 2026

Exposure to class actions remains a reality for businesses operating in Australia, and several emerging trends are set to influence that risk.

As the class action landscape in Australia evolves, so too do the associated corporate risks, creating an increasingly complex and dynamic environment for corporate Australia.

Here we highlight our predictions for class actions for the year ahead, what it means for Australian corporates, and practical tips to stay ahead. What is clear is that 2026 will be yet another defining year for class actions in Australia.

1. Evolving and expanding areas of focus

While filings in consumer and shareholder class actions are expected to remain steady, we anticipate continued growth in employment related claims and an uptick in cyber class actions. 

This increase will be driven not only by the prevalence of cyber security incidents faced by corporate Australia, but also by heightened regulatory enforcement in the cybersecurity space, which is expected to amplify compliance obligations and litigation risk. 

To mitigate these risks, organisations should prioritise a robust risk and compliance framework for wage and other employment entitlement obligations, conduct regular payroll audits, and strengthen regulator engagement to address potential issues early on. 

Staying ahead of regulatory developments and monitoring litigation trends in these sectors is also essential. Engaging with your external lawyers to stress-test business practices and disclosure protocols can help identify and address risks before they escalate into litigation.

2. Increased resolve among defendants

Although settlements will remain common, we expect to see more willingness on the part of corporate defendants to test the merits of their defenses in court.

This trend signals a shift in litigation strategy. For clients, it means that class actions may become more protracted and resource-intensive. 

It will be increasingly crucial to assess the merits of each case early and develop a litigation strategy that balances legal merits, commercial objectives and reputational risk. 

3. Increased resolve among defendants

The overlap between regulatory investigations and class action risk endures.

ASIC’s 2026 enforcement agenda prioritises misleading pricing practices impacting cost of living, financial reporting misconduct, and claims and complaint handling, as well as re-establishing market integrity following the collapse of Shield and First Guardian Master Funds. Financial reporting misconduct directly increases exposure to shareholder and investor class actions, whereas ASIC’s focus on misleading pricing practices and claims and complaint handling failures creates potential for consumer class actions, particularly in financial services and insurance sectors.

Clients should expect that regulatory investigations and class actions will increasingly proceed in tandem, often covering similar subject matter but at different speeds. This requires a coordinated response across legal, compliance, and communications teams. 

Early engagement with regulators and transparent internal investigations can help manage both regulatory and litigation risk. Developing a unified strategy at the outset — rather than reacting after risks emerge — will be critical to minimising exposure.

There is also potential for increased director liability exposure arising from ASIC’s enforcement activity, independent of any class action, where alleged market disclosure or governance failings are in issue.

4. Cross jurisdiction copycats

We are seeing a pattern where litigation initiated overseas, particularly in the United States, is followed by the filing, or investigation, of similar claims in Australia.

In 2025 we saw ‘copycat’ product liability class actions and investigations involving the medical and pharmaceutical sector, which we expect to persist in 2026.

We’re now seeing this expand into other sectors. In the automotive sector, Tesla was recently the subject of an Australian class action, with the allegations mirroring those brought in US proceedings.

5. ESG disclosure risk

Sustained regulatory focus on ESG issues — such as greenwashing and climate-related disclosures — will continue to create fertile ground for class action risk in 2026. 

While much of the activity to date has been regulator-led, we expect to see an increasing nexus between regulatory investigations, shareholder engagement, and follow-on class actions in this area. 

Heightened scrutiny of sustainability claims, environmental impacts and transition statements increase the risk that disclosure gaps or aspirational messaging are tested in court, particularly where there is a disconnect between public statements and business practices or performance. For listed entities, this risk is amplified as ESG disclosures become increasingly integrated into continuous disclosure, annual reporting, and fundraising materials. 

Class actions in this space are likely to be framed not only as misleading or deceptive conduct claims, but also as disclosure-based shareholder actions where ESG-related statements are alleged to have inflated share prices or obscured material risks. We can also expect class action promoters to continue to explore novel theories on loss and causation as this area matures and the case law develops. 

For corporates, this means that ESG risk can no longer be viewed solely through regulatory and reputational lenses. Robust internal governance around ESG data, careful alignment between sustainability narratives and operational reality, and disciplined disclosure practices will be critical. 

Against this backdrop, legal review of ESG statements — particularly where they intersect with financial performance or forward-looking commitments — will be an essential component of class action risk management in 2026. 

6. Courts to continue to refine case management

As class actions continue to grow in both number and complexity, Australian courts will remain focused on case management tools that promote efficiency, justice, and early certainty for defendants and class members alike. 

We expect continued judicial emphasis on class closure mechanisms, encouraging the parties to early mediation, staged proceedings, and increased scrutiny of common issues at an early stage. 

For defendants, this presents both challenges and opportunities. While early case management may compress timelines and increase upfront demands on resources, it may also provide a pathway to earlier resolution and greater certainty around exposure, particularly where claims can be narrowed or resolved on common issues. 

Strategic engagement with case management processes will therefore be critical. Defendants who invest early in understanding the scope of the claim, identifying pressure points, and engage constructively with the courts will be likely to achieve greater procedural certainty and cost control. 

In an environment where courts are increasingly interventionist, thoughtful and proactive litigation strategy can be a key differentiator in managing class action litigation in 2026. 

The year ahead in summary:

The Australian class action environment is becoming more sophisticated and challenging, particularly for global organisations. Proactive risk management, investment in technology, and coordinated legal strategies are essential to navigate this evolving landscape. Taken together, these developments mean that 2026 will be yet another defining year for class actions in Australia.

Preparing against cyber risk

Amongst the rising threats, cyber security remains a top concern, with preparedness being essential for risk mitigation and effective response.

Corporates should view cyber preparedness as an ongoing process, not a one-off exercise — cyber risk should be a standing agenda item for governance committees and be front of mind for Australian boards.

Regularly updating incident response plans, conducting tabletop exercises, and engaging with external experts can enhance resilience. 

Corporates should also ensure alignment with Australian and international privacy standards, and invest in proactive cyber security measures, including training and vendor risk assessment

In the event of a breach, prompt and transparent communication with stakeholders — including regulators, customers, and employees — can help contain reputational damage and reduce the likelihood of class action litigation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.