Navigating the waves of regulation change

In today's rapidly evolving global landscape, businesses stand at the intersection of opportunity and risk management. At the onset of 2025, companies faced unprecedented regulatory shifts, demanding swift adaptation in governance, risk, and compliance (GRC) strategies. The KPMG 2025 Mid Year Report sheds additional light on these emerging trends, offering invaluable insights as organizations navigate complex regulatory transformations.

Building out robust risk and compliance functions has historically been a top priority for forward-thinking organizations. The current U.S. Administration has taken strategic steps towards revising regulation to enhance global competitiveness and decrease regulatory constraints on businesses. This introduces a duality of challenges and opportunities for GRC functions. On one hand, reduced oversight aims to stimulate economic activity, foster innovation, and increase market efficiency. On the other hand, it could lead to increased vulnerability to emerging risks, challenges in aligning with regulatory requirements across jurisdictions, and deterioration of stakeholder trust.

The opportunity lies in organizations leveraging this shift to propel their agendas forward and innovate with fewer limitations. Executive Orders now serve as catalysts, providing businesses cues on where they can push boundaries. There's a chance for GRC leaders to steer through this transformative phase by capitalizing on potential market efficiencies and optimizing resource allocation.

Organizations now have the chance to adapt their GRC operating models, enhance their technology ecosystems, and optimize resource allocation in this new environment. As they navigate a whirlwind of regulation activity within the United States and strive to remain compliant globally, forward-thinking GRC programs are poised to seize these opportunities and enable sustained organizational success.

2025: A year of regulatory change

As businesses grapple with regulatory changes—aiming to reduce burdens while encountering novel risks—the fragmented regulatory landscape requires agile strategies to address emerging challenges effectively. Key sectors like technology, manufacturing, energy, logistics, and retail are feeling the effects of reshaped regulatory policies. While streamlining regulations promotes economic activity, the divergence between federal initiatives and state actions complicates compliance efforts. Companies must recalibrate programs, striking a balance between the benefits of domestic regulatory changes and meeting international demands, particularly Europe’s stringent AI and privacy laws.

Adapting GRC programs to evolving challenges

Interaction between changing U.S. regulation and defined international standards prompts businesses to reassess GRC frameworks. This dynamic presents an opportunity to optimize resources and leverage past learnings in future strategies. Enhancing GRC programs involves integrating advanced technologies and comprehensive analytics to manage shifting compliance requirements.

Integrating technology into GRC practices

In today's global economy, organizations must navigate an increasingly complex and evolving landscape of divergent regulations affected by political, economic, technological, and societal factors. What was once routine regulatory compliance now demands heightened attention and strategic foresight. To effectively manage these challenges, integrating advanced technology, expert insights, and strategic planning is crucial.

Proactive compliance relies on cutting-edge technology and expert analysis. Emerging GRC solutions offer real-time data feeds and AI capabilities, enabling businesses to stay informed, forecast trends, and adjust operations accordingly. AI marks a significant advancement in transforming compliance and regulatory change management. With natural language processing tools, AI can interpret complex regulatory texts, providing actionable insights for internal controls and policymaking. It helps validate policy coverage, identify gaps, predict regulatory shifts, and align compliance strategies with anticipated changes.

Integrating advanced technology starts by leveraging regulations as a foundation to drive key activities such as policy management, compliance management, and the establishment of internal controls. Enhanced with real-time regulation data feeds, an integrated GRC solution can alert organizations to regulatory changes, facilitate assessments, and provide the data necessary for proactive decision-making. With AI's capabilities, these solutions can continuously monitor compliance, ensuring adherence to local requirements amidst varying global regulatory topics, such as AI governance.

Predictive analytics—powered by AI—enable organizations to foresee potential regulatory changes based on historical data, current trends, and socio-political developments. This foresight allows businesses to leverage regulatory compliance strategically, transforming it into a competitive advantage. By employing a modern solution that continuously monitors compliance, organizations stay ahead of regulatory changes, ensuring continuous adherence and optimization.

Navigating the waves of regulation change demands a nuanced approach that aligns strategic vision with emerging trends. As a leader in risk and compliance innovation, KPMG empowers organizations to manage regulatory transformations. By leveraging KPMG’s insights, businesses can utilize regulation as both a framework and an asset to gain a competitive edge.

Contact us to learn more about how we support organizations in their strategy for managing regulatory change and driving transformation with technology.