A new ethics network is planned as the LSB warns of conduct undermining trust and the rule of law
A new professional ethics network is to be launched in an effort to drive a cultural shift across the legal profession, after evidence showed that ethical standards among some lawyers continue to fall short.
The initiative was outlined in the Legal Services Board’s draft business plan for 2026 and 2027, which is currently subject to consultation. The plan also reveals that the LSB’s budget is expected to fall slightly next year, following a significant increase in the current financial year.
The oversight regulator said its recent evidence gathering, including material from the Post Office Inquiry and its own report into the misuse of non-disclosure agreements, had highlighted serious ethical concerns. These included situations where lawyers’ independence was compromised or where courts were misled.
According to the LSB, such conduct causes harm to consumers and weakens the rule of law, ultimately eroding public trust. It said improving understanding and adherence to professional ethics was therefore critical for the health of the legal system.
Last year, the board consulted on a draft statement of policy on upholding professional ethical duties. This policy is expected to be finalised during the coming year, after which frontline regulators will be required to respond to its expectations.
Embed from Getty ImagesThe draft business plan says that achieving the required cultural step change will depend on a shared commitment not only from regulators but from the legal sector as a whole. To support this, the LSB plans to convene a Professional Ethics Network.
The network will be used to identify emerging ethical challenges and to develop and share recommendations on how professional ethics should be understood and applied across the sector. The aim is to embed the principles set out in the forthcoming policy statement more effectively.
Consumer protection has also been identified as a major priority for the year ahead. The LSB said its market surveillance work had highlighted key areas of risk, including mass claims activity, third-party litigation funding, the potential collapse of large law firms, and developments in the unregulated sector. It also flagged the increasing use of artificial intelligence as an emerging concern.
The regulator said it wanted to ensure that, as the legal services market evolves, consumers are able to make informed choices and understand the risks associated with different services.
The consultation revealed that the LSB had unsuccessfully applied to the government backed Regulators’ Pioneer Fund for support to create a voluntary standards regulatory sandbox for artificial intelligence-powered consumer lawtech. Despite this, it said it was actively exploring alternative ways to progress the work.
The proposed sandbox would have examined how voluntary standards could support high quality AI driven legal tools, promote responsible innovation and help consumers assess the suitability of such services.
The LSB also pledged to revise its approach to overseeing frontline regulators, aiming to reduce unnecessary burdens where performance is strong while taking firm action where required. This will include quarterly monitoring of the Solicitors Regulation Authority and the Bar Standards Board, with the LSB stating it expects to see improvements from both.
A planned review of internal governance rules has been paused due to potential litigation that may affect the framework. Overall, the rules were said to be operating as intended.
The proposed budget for 2026 and 2027 is just under £5.7m, representing a small reduction. The LSB said this reflected lower accommodation costs, the absence of one-off expenditure, and a greater use of technology, including artificial intelligence, to improve efficiency.