Increasing uncertainty is changing the way companies do business around the world. In-House Perspective considers the work of the legal team as organisations seek to adapt.

Events previously perceived as unlikely now happen with increasing regularity. The war in Ukraine and conflict in the Middle East have disrupted trade and supply chains, for example, which in turn has damaged the global economy and exacerbated the cost-of-living crisis. The US President, Donald Trump, has attempted to impose significant tariffs on a large number of countries, claiming this will boost American manufacturing and create jobs. One consequence has been uncertainty for businesses globally.

Meanwhile, the rising frequency of extreme weather events caused or shaped by the climate crisis is creating further barriers to doing business. Cyber criminals are developing more sophisticated methods – aided by artificial intelligence – and successfully targeting major companies.

In this context, risks such as sanctions, tariffs, trade disruption and cybersecurity have all moved up the agenda. Companies must adapt to ensure they can continue to operate. For some organisations, what they consider to be the greatest risks they face may have shifted. For Rudolf Von Moreau, Vice-Chair of the IBA Corporate Governance and Activism Subcommittee, the most significant risks now relate to regulation and export control, for example.

‘Flexibility is the key topic today,’ says Giovanni Lombardi, Chair of the IBA Corporate Counsel Forum, who sees a move away from globalisation towards nationalisation and the re-shoring of businesses and suppliers. He says this trend can create legal risk if the business is bound by an exclusivity contract that can be ‘difficult to exit […] without facing economic impact or risks.’

Meanwhile, Ben Bleicher, an officer of the IBA Antitrust Section, highlights how cyber risk has become more complex to manage because of the involvement of state actors. ‘The change from a commercial to a state-actor threat has meant the severity, extent and frequency of attacks has gone up,’ he says.

How risk looks today

In response to such volatility, some business leaders are changing how they manage risks. Lombardi, who’s also Chair of LAISA (STA), a legal-tech company operating on the Italian market, says risk management has moved away from defining a framework and then measuring where the business is moving within that structure. Now, he says, risk management ‘is more an ongoing exercise whereby your frameworks change’ and are constantly adjusted because ‘the solution you have in place today might not still be the best solution in three months’ [time].’

Derek Leatherdale, a senior geopolitical risk adviser at Sibylline – a private intelligence company that helps organisations manage risks – agrees. Businesses are still ‘navigating from an old template of risk management to something that reflects a much more dynamic, volatile external environment,’ he says. He adds that risks are emerging faster and their effects on organisations are multifaceted. Business leaders are working on being able to anticipate shocks, such as recent events in the Middle East, so they can respond more effectively, says Leatherdale.

Von Moreau, who’s also General Counsel at Infineon Technologies in Munich, says the risk management process is strengthened by constantly being tested. Consequently, an organisation will respond more effectively to shocks.

Marina Araujo, an officer of the IBA Corporate Counsel Forum, highlights that in some cases, different authorities are trying to regulate the same issue, creating more uncertainty for companies. Araujo – who’s also Legal Manager in Corporate, Commercial and Permitting at Anglo American in Brazil – says that, in this context, her company has adapted its risk assessments, trying to think creatively about how its operations might be affected.

For Bleicher, who’s also Interim Antitrust Counsel at Ford Motor Company in London, it’s how business leaders rank risks that has changed, rather than how they manage them. For example, trade disruption risks, which are an immediate consequence of geopolitical uncertainty, may have risen up the agenda. The in-house legal function might respond by building protections into contracts, such as including force majeure clauses or seeking greater indemnities, he says.

One way business leaders and boards of directors are responding to emerging risks is by setting up committees to address them. This can be at a board or operational level. These committees might focus on a specific event or risk type, which can help the organisation respond quickly to disruption.

Often these committees are cross-functional because geopolitical risks can affect different teams across the business, in various ways. Because of this, Leatherdale says, one individual should take responsibility for how the organisation as a whole manages geopolitical risk, to avoid a siloed approach. Some companies are hiring new people to manage or lead in this area, who might report to the chief risk officer.

Lombardi agrees that different areas of the business must communicate to manage geopolitical risk effectively. He believes that internal functions have come closer together over the past ten years and that individuals, including those from the legal team, are more likely to move into different areas. This level of flexibility can help the business to respond to the complex risks it faces, he says.

Leatherdale says general counsel (GCs) with a governance remit should consider whether the board receives enough expert insight into geopolitical issues on a regular basis. If not, a company could, for example, hire a part-time geopolitical adviser to provide regular updates to the directors. Alternatively, they might employ a specialist non-executive director. Or, if the audit committee oversees risk or the board has a standalone committee for this task, that body might need to analyse geopolitical risk in greater depth and more regularly. Leatherdale adds that the board should also receive impact assessments to understand what certain geopolitical risks mean for the business so that the directors can scrutinise the actions of the management team more effectively.

According to Leatherdale, ‘a lot more legislation and regulation […] is being geopolitically driven by various governments.’ Some GCs are by default taking the lead on understanding what this means for their organisation, he adds. Going forward, Leatherdale believes ‘there will probably be less international co-ordination on regulation.’ For GCs, he says, this means more jurisdiction-specific regulation that must be complied with locally, which may also differ from standards and frameworks in other countries. Harmonised regulatory frameworks that operate across multiple jurisdictions are now less likely to appear, he adds.

Bleicher says the best way to address regulatory fragmentation is to meet the highest standards wherever they are and adopt a different approach locally if needed. Lombardi warns, however, that going above and beyond what’s legally required, or ‘gold plating’, can risk the business becoming less competitive.

In Bleicher’s view, multinational companies can sometimes be more influential than individual countries in setting regulatory best practice. Lombardi agrees that a multinational company’s ‘specific influence on regulation is much higher than [a] single country’s.’ In that sense, says Lombardi, the regulatory standard on some international issues may be driven by what multinational companies have to comply with, regardless of which state or organisation has set those criteria.

The corporate diplomat

Some GCs and their teams are increasingly engaging in internal corporate diplomacy to explain the legal complexities that are emerging to the board and the management team. Von Moreau says this ensures that ‘those people that take the decisions in the company understand the basis’ for them. He adds that his legal department is also actively involved in working with the company’s government affairs group to explain the interests of the business to regulators and industry federations.

Araujo says her company has relationships with external organisations such as professional bodies. The business also engages with the government to encourage it to create a stable and predictable regulatory environment that’s attractive to foreign investment.

‘There’s nearly always merit in trying to engage’ on new regulation or legislation, says Leatherdale. However, he believes that corporate diplomacy may be less effective in changing regulation where it has been strongly motivated by a government’s national security concerns. Governments may be less open to tweaking such regulation to suit a company’s interests.

Leatherdale adds that certain governments might be more willing to meet business leaders whose companies are domiciled in their country than they are about engaging with those whose businesses are domiciled elsewhere. This is especially the case if the company is based in a country that the government doesn’t have a good relationship with. ‘There’s a growing thicket of regulation and legislation’ emerging from different countries around the world, he says, ‘and a company’s ability to influence those all at the same time is probably negligible.’

Bleicher says business leaders need to take a ‘very nuanced country-by-country approach’ to corporate diplomacy, being aware of the messages they put forward both publicly and in their government affairs relationships and how these may need to be tailored to a specific jurisdiction.

Business functions should be aligned when an organisation engages with a country, so that the company’s messaging, approach and style are consistent, he adds. Taking this approach will avoid any unintended consequences where the outcome of an engagement in one area negatively affects another aspect of doing business in that country, Bleicher explains. ‘The worst you can do is have fractured conversations with governments,’ he says. Companies can counter political volatility by consistently engaging with governments and regulators to build up a good reputation over time, he adds.

GCs and their teams can respond to uncertainty by building up access to local expertise in the jurisdictions where their company operates. Von Moreau says his team is regionalising for this reason. His organisation are taking on more foreign language speakers in the central legal team to enable better communication with local experts. Helena Ledic, an officer of the IBA Corporate Counsel Forum, says that her organisation ‘could not function multinationally without the expertise of local people in each jurisdiction.’

Ledic, Associate General Counsel and Senior Director at CSC in Chicago, says that a recent report by her organisation – The General Counsel Barometer 2026: from Complexity to Control – found that access to specialist talent has become of greater concern to GCs over the past year. The report writers surveyed GCs and senior legal professionals in Europe, the UK, North America and the Asia Pacific about the issues affecting them. Thirty-two per cent of respondents said they weren’t confident they were responding to challenges with sufficient in-country legal expertise. Meanwhile, 29 per cent said they weren’t confident about their ability to monitor how local legislative changes would affect filings and standards.

Bleicher says that the company’s head of country should be in tune with local ethics and prevailing opinion and be communicating with the resident business community and government. He says accumulating this kind of local intelligence, which can be as important as knowing what the law is, requires real engagement and trust that can take years to build up.

The operational evolution

Macro-economic risks are usually the remit of the CEO or the chief financial officer rather than the GC, who typically monitors legal risk, says Lombardi. However, recent global developments are bringing legal and operational risks closer together. For example, tariffs are a tax risk but they’re also a legal one. Or a disruption event caused by geopolitical instability can create a supply chain risk.

Lombardi believes that, increasingly, GCs will move into the operational side of the business as greater cooperation across functions is required to manage emerging risks. ‘Joining the operations field is a natural evolution for GCs in specific industries,’ he says. ‘The geopolitical factor would work as an accelerator for that.’

Araujo says that to be able to do business, company leaders must understand what’s happening internationally. This hasn’t always been the case. Having this understanding ‘helps us to better assess the risks here in Brazil and the work that we do, because everything is connected,’ she says.

Lombardi says that in-house legal teams should closely monitor regulatory changes in different jurisdictions so they can forecast future developments. He says the legislative process is more transparent than it used to be, with in-house counsel able to track the evolution of a proposal and provide feedback before it’s enacted. Internal functions should work together by exchanging their ideas and views to help the company be active in the regulatory environment, adds Lombardi.

Contracts with suppliers and legal frameworks for managing the supply chain should be flexible enough to manage the legal risk attached to a specific geopolitical issue, says Lombardi. ‘The fact that geopolitical uncertainty […] has been disruptive for certain industries should be the alert bell to rethink your overall set of agreements with clients on the one hand and suppliers on the other,’ he says.

GCs may also need to reconsider how they structure their local legal entities and their internal structure in this regard, Leatherdale says, noting that these have traditionally been optimised for tax efficiency as an overriding principle. Governments are increasingly pushing for greater visibility of what companies are doing in their jurisdiction, which means such structuring may need to be rethought. Respondents to CSC’s GC Barometer report cited the reorganisation of global entity structures as number seven of the eight top priorities identified for legal operations in 2026.

Leatherdale believes that ambitious GCs with a good sense for strategy are well placed to assist the board with the governance of geopolitics. GCs ‘have an amazing ability to look across on behalf of their boards at the way their companies do geopolitics and whether there’s scope to improve that,’ he says.

Bleicher says it’s important that multinational companies do the right thing because they’ll outlive specific governments and their agenda. Taking this approach will allow the business to transcend periods of volatility. ‘Doing the right thing, leading with your heart and sticking to your company values and ethics is very important,’ he says.

Ledic agrees. She says her company’s five-year mission statement always includes a promise to take responsible action towards their customers, regulators and employees. ‘If we use that as our guiding star, that carries us through taking the right actions,’ she says.