Leading global law firm Baker McKenzie today published the results of its eighth annual global survey of 600 senior in-house lawyers at industry-leading multinationals, the Global Disputes Forecast 2025. The report looks at the disputes landscape for the year ahead across various sectors and offers actionable insights to help organizations prepare for the future.
Key Findings
The survey reveals that technology-related issues top the list of concerns for businesses heading into 2025. Cybersecurity and data privacy emerge as the top disputes risk, driven by the proliferation of data breaches and stricter regulatory requirements. Additionally, the rapid pace of digital transformation, particularly the integration of artificial intelligence (AI) into business processes, introduces new litigation and compliance risks around data governance, data privacy and ethics. Against this backdrop, spending on dispute management shows no sign of slowing: 85% of respondents said they expect their disputes spend to increase or stay the same in 2025. Additionally, litigation preparedness remains a critical concern for organizations, with several barriers preventing them from being fully prepared for potential disputes. Class actions and investigations also continue to be significant concerns.
“We are at an inflection point where cyber risk is concerned. With technological advancement – such as AI and other drivers for digital transformation – as well as the increased global geopolitical threat, it’s not hard to see why we are witnessing a rapid increase in cyber-attacks right across the eco-system,” commented Vinod Bange, partner, London.
"Companies should remain savvy in monitoring AI developments across legal disciplines – not just IP-related case law and legislative developments, but also existing privacy and sector-specific regulation as well as emerging horizontal AI regulation – to develop a strategy to manage legal risk and maximize opportunities," added Isabella Liu, partner, Hong Kong.
Key Disputes Trends: 2025 Snapshot
According to respondents, the following dispute types present the greatest risk to organizations in 2025 (ranked by percentage of respondents identifying them as a top risk):
• Cybersecurity and data privacy: 45%
• Artificial intelligence: 44%
• Employment: 32%
• Commercial and contract: 25%
• Tax: 25%
Cybersecurity and Data Privacy Disputes
Cybersecurity and data privacy remain at the forefront of organizational concerns, with respondents identifying this topic as the top disputes risk (45%). The growing frequency and sophistication of cyberattacks, stringent regulatory requirements and changes to operations are key factors driving this trend. When asked to analyze the impact on their organizations, respondents who were concerned about cyber and data risk cited investigations and enforcement action (including fines) as the top concern (70%). Recent developments in cybersecurity regulations have further intensified concerns around financial and reputational damage and exacerbated fears of investigations. Meanwhile, the rise of remote work and the growing use of cloud services and third-party vendors have introduced new vulnerabilities. As cyber threats become more sophisticated, insurance policies may not fully cover the damages or may lead to disputes over claims; this is a concern for 44% of respondents focused on cyber and data risk. Among the same group, cyber and data compliance issues in the supply chain are also an issue for 41% of respondents.
Artificial Intelligence Disputes
AI-related disputes are highlighted as a significant dispute risk by 44% of respondents. For these respondents, primary concerns revolve around data privacy and security (60%), as well as ethical disputes (59%). Intellectual property disputes are also prominent (55%), reflecting the complexities of integrating AI into existing legal frameworks and the potential for misuse or misappropriation of AI technologies. Businesses are concerned about AI-underpinned output being at risk of IP infringement, alongside other IP risks, such as inadvertently infringing a third-party trademark or infringing the personality rights of individuals. Additionally, questions around ownership and protectability of content produced by or with assistance from AI can also invoke issues of IP ownership, enforcement and management.
Employment Disputes
Almost a third (32%) of respondents view employment disputes as a major risk. Competition scrutiny, including restrictive covenants/noncompetes, has become the leading concern for employment disputes; among those that cited employment as a risk, 42% see it as the top risk. In 2024, the US Federal Trade Commission took steps – which face ongoing legal challenges – to impose a nationwide, nearly complete ban on worker noncompete agreements. This aligns with the broader trend of global antitrust regulators looking at competition between employers as they vie to attract and retain employees.
For those concerned about employment disputes, equal pay considerations are another key concern (cited by 40%), prompted by pay transparency regulations that have swept the globe in a bid to close gender gaps in the workplace. Workplace investigations are another contentious area, with 40% concerned about discrimination or harassment disputes, against a backdrop of stronger protection for whistleblowers and a rise in reporting.
Tax Disputes
Tax disputes are a concern for a quarter of respondents. Global employee mobility – driven by enhanced technological platforms, digital nomadism, the easing of COVID-19 restrictions, job relocation and increasing demand for remote work opportunities – is the chief driver of tax dispute risk (cited by 62% of respondents who identified tax as a risk). Over half of those respondents also cite indirect tax (51%), including industry-specific tax, and transfer pricing (also 51%) as key tax dispute areas. Indirect tax disputes arise from the dynamic nature of VAT and GST regulations and the attempts of tax authorities to try to adapt to a rapidly-changing economy. Transfer pricing disputes continue to be one of the main focuses of tax authorities, and they represent a challenge for multinational companies since they involve a thorough analysis of their business model and value chain.
When it comes to managing tax disputes, litigation remains the resolution mechanism of choice, with more than 90% of respondents citing litigation as a preferred mechanism and 72% citing arbitration.
Post-M&A Disputes
Meanwhile, tax issues are the most common triggers for post-M&A disputes. Tax indemnities or other tax-related topics were cited by 56% of respondents who identified post-M&A dispute risks. Transactions often trigger an audit by the tax authorities which can then lead to taxes relating to the time period before the closing of the transaction. General contract claims were also top of mind for these respondents (also cited by 56%), as were purchase price or valuation disputes (46%).
Organizations predicting post-M&A disputes are most likely to consider legal claims against the other party in a transaction due to third parties asserting claims (72%), earnings problems or operative liquidity issues in the acquired company (66%), and problems identified during the preparation and audit of annual financial statements (62%).
ESG Disputes
ESG disputes remain a concern for organizations, with 21% of all respondents highlighting them as a significant risk. The most prominent ESG dispute risk is waste management (cited by 60% of respondents identifying ESG as a risk), while almost half (45%) cite water stress as a prominent risk. The regulation of emissions (34%) and energy transition (33%) are also significant concerns.
Barriers to Litigation Preparedness
Litigation preparedness remains a critical concern for organizations, with several barriers preventing them from being fully prepared for potential disputes. According to our survey, the most significant barrier is the inability to keep pace with regulatory developments (cited by 60% of respondents), followed by difficulty finding the right external advisers, and funding and resourcing challenges (both cited by 53% of respondents). Supply chain vulnerabilities (50%) and internal organizational structures (45%) also lead to gaps in litigation preparedness.
Growing Class Actions Concerns
Class actions continue to be a significant concern for organizations, with the UK (51%), Germany (40%) and Australia (39%) identified as the top three countries posing the greatest risk outside the US. Following the UK Supreme Court's judgment in Merricks in December 2020, there has been a significant upswing in collective claims filed. In the US, where class action risk is well known, organizations remain alive to new threats. For instance, companies may be liable for wiretapping based on the use of common analytics software. In California, for example, plaintiffs have filed hundreds of lawsuits against businesses in a wide range of sectors, alleging that the use of technology, including chatbots and website cookies, requires express consumer consent. Those operating without that consent would potentially fall foul of unlawful eavesdropping or wiretapping under the California Invasion of Privacy Act.
Investigations Risk
In line with the dispute risk analysis, cybersecurity and data privacy tops the list for investigation risks in 2025 (52%). Trade wars and geopolitical concerns have also brought sanctions and export controls front of mind for organizations (42%), which now must comply with an expanding global framework of sanctions, not just emanating from the United States, as well as the risk of counter sanction. After taking the second spot in 2024, ESG investigations have slipped down the list this year, becoming the fourth most prevalent concern for respondents in 2025 (40%) alongside employment (40%). Anti-bribery and corruption investigations placed a little higher in priority than last year (36%). Tax investigations came sixth at 34%, driven by complex regulations and global business operations, with a focus on transfer pricing and the OECD's Base Erosion and Profit Shifting (BEPS) framework.
Sector Insights
Consumer Goods and Retail (CGR)
• 37% of respondents in the sector rank AI as the greatest dispute risk to their organizations. IP and AI issues have overlapped in recent high-profile litigation related to the unauthorized use of material in training generative AI. There is also a growing threat of litigation from "AI washing," where companies may, deliberately or inadvertently, make false and misleading statements about their use of AI.
• IP, brand and patent disputes are also identified as prominent risk areas (37%). As counterfeits become more sophisticated, brands have to keep improving their technology and detection methods, particularly as e-commerce has provided a wide variety of selling methods to those peddling counterfeit goods.
Energy and Infrastructure (E&I)
• Respondents in this sector were more concerned about ESG disputes than in any other industry; it was identified as the greatest dispute risk by 40% of respondents in the sector. Companies in this sector have vastly increased the resources they are putting into ESG in recognition of the increased focus on both regulatory compliance and media and public scrutiny. This investment may be starting to ease concerns; although 40% of respondents anticipate ESG disputes, the figure is significantly lower than last year.
• Respondents in E&I were also twice as likely as those in other sectors to predict a dispute in response to restructuring and insolvency (28%). This is likely due to changes in the business environment, including the shift from fossil fuels to renewables, resource nationalism trends and volatile commodity prices, which are affecting product viability, as well as macroeconomic trends such as currency fluctuations, foreign exchange control issues and challenges in accessing international financing for projects, which are driving structural changes.
Financial Institutions (FI)
• Respondents from financial institutions were more optimistic in their disputes outlook than respondents in other sectors. More than a fifth of respondents predicted that their disputes spend would decrease in 2025, the highest proportion of any sector group.
• Cybersecurity/data privacy and AI were the clear risk front-runners for FI respondents; they were cited by 66% and 61% of respondents in the sector, respectively. While AI systems provide huge opportunities for innovation, efficiency savings and potential benefits to customers, they may also create more opportunities for cybercrime, data breaches and allegations of mishandling personal data.
• Although AI is perceived as a higher area of risk for FI respondents, the sector is also using AI proactively in dispute management, particularly in analysis and decision-making.
Healthcare and Life Sciences (HLS)
• Cybersecurity/data privacy and AI were the top disputes concerns for companies in this sector; both were cited by 46% of respondents in the sector as the greatest dispute risk. Among those concerned about a cyber or data incident, 83% fear regulatory investigation or enforcement action, including fines. The use of AI goes hand-in-hand with increased cyber threats, a particular consideration for HLS companies that handle patients' personal and medical data, including in the context of clinical trials, research and testing. Additionally, the use of AI in products and services, particularly in predictive health, telemedicine/remote medicine and remote patient care further increases the risk.
• Employment disputes have risen up the list significantly this year as an area of concern for all HLS respondents (36%). In this sector, respondents cited employment dispute concerns relating to misconduct investigations/whistleblowing as well as equal pay/pay transparency/other pay disputes.
Industrials, Manufacturing and Transportation (IMT)
• Almost half of IMT sector respondents anticipate an increase in disputes spending in 2025, compared to an average of 33% across all sectors.
• Cybersecurity/data privacy (43%) and AI (35%) were the top expected dispute types, related to issues such as the development of automated machinery and transportation systems using AI systems. Increasingly, companies in this sector must consider contractual clauses that explicitly deal with potential failures, injury and resulting liability related to the AI systems they create, maintain or even just use.
• When asked about litigation preparedness, 60% of IMT respondents cited the inability to keep pace with regulation as a chief barrier.
Technology
• For the third year in a row, cybersecurity/data privacy (56%) is the top expected dispute for this sector, closely followed by AI (54%). In particular, we expect to see more disputes and more regulation around the data generated by IOT devices and the cybersecurity risk that these devices present.
• Among the technology companies concerned about cyber security and data privacy, 61% were most worried about a regulatory investigation or enforcement action. Almost half of respondents (45%) highlighted concerns around cyber and data compliance issues in their supply chains. Companies must consider the wider legal risk if a cyberattack in their supply chain shuts down core business operations. For example, a cyber incident in an upstream supply chain that prevents an organization from delivering to downstream customers might bring contractual liability as well as cyber-specific legal risks.
Survey Methodology
The Global Disputes Forecast 2025 survey was conducted with 600 senior in-house lawyers from a diverse range of sectors at industry-leading multinationals (ranging from $500 million to $50 billion+ in turnover) in September 2024. Respondents were based in Brazil, Hong Kong, Germany, the UK, the US and Singapore. The survey aimed to capture the key concerns and emerging trends in the disputes landscape, providing a comprehensive overview of the challenges businesses are likely to face in the coming year.
About Baker McKenzie’s Global Dispute Resolution Capabilities
Baker McKenzie has more than 1,000 disputes lawyers across its 74 locations globally. Our team comprises battle-tested litigators with deep roots in their home jurisdictions. We have extensive experience in key industries including: consumer goods and retail; energy and infrastructure; financial institutions; healthcare and life sciences; industrials, manufacturing and transportation; and technology.