As governments around the world respond to growing geopolitical, social, and macroeconomic uncertainty, chief audit executives are warning that global policy changes are having a profound and negative impact on the risk landscape facing their businesses.
New research from the Chartered Institute of Internal Auditors, based on a survey of almost 900 Chief Internal Auditors across the U.K. and Europe, has revealed that changes in laws and regulations are now the single most impacted area by recent global policy changes, cited by nearly two-thirds (64 percent) of respondents. This comes amid a backdrop of rising global trade and geopolitical tensions, including as a result of the renewed U.S. tariff threats, which are driving a surge in business risk.
“The message from our research is clear: global policy changes—whether related to trade, regulation, or climate change—are having a direct and growing impact on the risks businesses must manage. In an increasingly volatile world, internal auditors serve as a vital source of assurance against the multitude of threats organizations face,” said Anne Kiem, chief executive of the Chartered Institute of Internal Auditors, which represents internal auditors in the U.K. and Ireland. “We urge business leaders to work closely with their internal audit teams to gain assurance that internal control and risk management frameworks are agile, responsive, and robust in this fast-changing environment. It is also essential that boards ensure internal audit functions are properly resourced to carry out their roles effectively.”
Following a wave of recent cyberattacks targeting major U.K. retailers, cybersecurity has emerged as the second most impacted risk from rising geopolitical uncertainty-cited by half (50 percent) of Chief Internal Auditors. This reflects an increase in the number of cyberattacks instigated by hostile states like China, Iran and Russia. Market volatility, shifting consumer behavior, and intensifying competition were also flagged by 46% of respondents, as global policy changes shape consumer spending choices. Notably, some European consumers are turning away from brands associated with the new US Administration—evidenced by Tesla’s plummeting sales—in favor of companies whose owners are perceived to uphold stronger ethical and moral standards.
Top 5 Risks Most Negatively Impacted by Global Policy Changes
The top five risks most negatively impacted by global policy changes related to macroeconomic, social and geopolitical uncertainty are as follows:
- Change in laws and regulations (64 percent)
- Cybersecurity and data security (50 percent)
- Market changes, competition and changing consumer behaviour (46 percent)
- Digital disruption, new technology and AI (46 percent)
- Climate change, biodiversity and environmental sustainability (43 percent)
The findings form part of the Chartered Institute of Internal Auditors’ flagship annual research project, Risk in Focus 2026, with this year’s report marking its tenth anniversary. The report provides a forward-looking view of the top risks facing organisations across Europe. 