Corporate & Commercial 2026

Trends Shaping Legal Considerations for Boards and Businesses

Corporate and commercial legal practice is evolving alongside significant opportunities and challenges for businesses worldwide. Unpredictable global markets, geopolitical tensions, rapid technological innovation and shifting regulatory regimes are prompting businesses to reconsider their business strategy and risk management approach. The Corporate & Commercial 2026 Global Overview Practice Guide examines the key trends shaping legal considerations for boards, management teams and their advisers in this developing environment.

A shifting governance focus

Over the last decade, corporate governance has shifted from a focus on board structure, financial performance, shareholder rights and fiduciary duties to an emphasis on risk oversight, regulatory compliance and decision-making that considers stakeholder expectations, rapid technological development and sustainability. Directors are now expected to weigh these considerations, along with long-term impacts, where relevant to the corporation’s best interests.

This includes understanding how environmental, social and governance (ESG) issues affect enterprise value and risk, with governance expectations extending to climate risk, sustainability strategy, human capital management, supply chain ethics and diversity. After several years of focus on these matters, geopolitical tensions and regulatory developments have resulted in a tempering of (and in some cases backtracking on) ESG-related governance efforts in many jurisdictions. It remains to be seen where the ESG pendulum shifts from here.

While cybersecurity, data breach prevention and crisis management planning have been on the radar of boards for some time, AI governance is emerging as the next major technology-focused area of board oversight. AI introduces new digital vulnerabilities that carry heightened enterprise risk. Although legislative regimes for AI adoption and use are still developing, regulatory and market practice are coming to expect companies to have AI governance frameworks in place. Boards are expected to be AI-literate and able to articulate how AI is governed within the organisation.

More broadly, directors are facing growing scrutiny over expanding disclosure and reporting obligations around cyber incidents, AI use and related risk factors and governance controls, causing increased pressure to justify major strategic decisions and demonstrate a robust decision-making process.

Rising shareholder activism

Shareholder engagement continues to be a central aspect of corporate governance worldwide. Shareholder activism has become increasingly transnational, with investors playing a more active role in influencing corporate strategy, governance and board accountability across jurisdictions. Activist shareholders are willing to challenge board decisions, vote against directors’ re-election, campaign for changes to corporate strategy or governance, and advance or support litigation where they believe directors have failed in their duties. This trend is no longer confined to the largest public companies, as mid-market and even private companies are seeing a more engaged shareholder base. 

Regulatory scrutiny and complexity

Shifting regulatory frameworks are prompting businesses to adapt quickly across multiple jurisdictions. After several decades of governments promoting globalisation, the past few years have seen a renewed focus on economic sovereignty, with regulatory regimes adapting accordingly. These tensions present challenges to businesses balancing international growth with compliance across shifting regulatory regimes. Regulators are taking a more active approach to corporate governance and individual accountability, with greater emphasis on transparency, risk disclosure and governance controls.

Antitrust authorities worldwide are intensifying enforcement, particularly in relation to digital markets, data-driven business models and concentrations of market power involving large technology and AI platforms.

Jurisdictions are taking markedly different approaches to AI, and active compliance regimes are only slowly taking shape. In the meantime, multinational businesses are navigating a patchwork of dedicated legislation, consumer protection enhancements, and privacy rules related to AI.

Cross-border transfers of personal data are increasingly subject to legal restrictions, prompting businesses to map their data flows carefully and put contractual and technical safeguards in place. Regulators are showing greater willingness to enforce, and non-compliance can result in both financial penalties and reputational harm.

Anti-money laundering, sanctions, and anti-corruption enforcement have become increasingly prevalent, with regulators co-ordinating internationally. Businesses with international dealings are adopting compliance programmes that can be updated swiftly, as well as screening designed to identify exposure at an early stage.

Environmental obligations are following a similar trajectory, with climate-related litigation emerging as a source of legal risk.

Securities regulators are refining continuous disclosure requirements, insider trading rules, and shareholder disclosure thresholds as public markets globally seek to attract investment without compromising investor protection. Internal controls and whistle-blower protections remain a consistent area of regulatory focus.

The new deal environment

Recent developments have altered how businesses conduct transactions and manage transaction risk. Rising geopolitical tensions and economic security concerns have led countries to increase scrutiny of foreign investments. Certain jurisdictions have introduced unique outbound foreign investment regulatory regimes. Cross-border mergers, acquisitions, joint ventures and investments are now subject to significantly greater national security review and antitrust clearance, and governments that historically encouraged foreign investment have expanded foreign direct investment screening regimes to protect critical infrastructure, sensitive technologies, data assets, semiconductors, telecommunications, AI and energy resources.

Tariffs and shifting trade policy are adding a further layer of uncertainty to cross-border transactions and supply chain arrangements. Businesses are increasingly factoring tariff exposure, export restrictions and the potential for retaliatory trade measures into deal pricing, supply agreements and long-term sourcing strategies, while also monitoring currency volatility and its effect on cross-border deal value and financing costs.

Transactional diligence has expanded beyond traditional financial and legal reviews to also cover geopolitical exposure, sanctions risk, cybersecurity, AI governance, data privacy, supply chain resilience, ESG issues, human rights compliance, workplace culture and regulatory readiness. Transaction agreements now include more robust representations, warranties, covenants, indemnities, closing conditions, termination rights and purchase price adjustment mechanisms.

Similar risk allocation measures are finding their way into everyday commercial agreements. Licensing, data rights and ownership of outputs generated using AI tools are now routine points of negotiation in supply, services and collaboration agreements, and these agreements now allocate responsibility for AI-related liability, including which party bears the risk of inaccurate, infringing or otherwise defective AI-generated outputs, and what indemnification obligations apply as a result.

Data governance terms, such as data residency, permitted use and security requirements, are appearing in routine supply, distribution and services agreements that would once have addressed data only in passing. Commercial agreements of all types are increasingly specifying minimum security standards, breach notification timelines, and co-operation obligations in the event of a cybersecurity incident.

Supply chain governance is following a similar path, with ESG-related supplier codes of conduct, representations and warranties, and audit and inspection rights now appearing in routine supply and distribution agreements.

Sanctions compliance and export control provisions are also appearing as standard terms even in commercial agreements that do not otherwise involve cross-border or regulated activity. Representations regarding sanctioned party status, export control compliance, and termination rights tied to a counterparty’s sanctions exposure are commonly included.

A tightening financial landscape

Access to financing has become a pressing challenge for businesses in this environment, as rising interest rates have increased the cost of capital and tightened credit conditions, prompting traditional bank lenders to apply more conservative underwriting standards and, in some cases, retreat from certain sectors altogether. This has accelerated the rise of private credit and other non-bank lenders as a significant source of financing for acquisitions, growth capital and refinancing, offering borrowers greater flexibility and speed of execution, often at a higher cost of capital and with further restrictive contractual terms.

At the same time, both traditional and private lenders are requiring robust covenants in credit agreements, including tighter financial maintenance covenants, enhanced information and inspection rights, and greater contractual control over borrower operations and future indebtedness, to protect their position in a higher-rate, higher-risk lending environment. Consequently, borrowers face more heavily negotiated debt commitment letters and credit agreements, increased financing conditionality in acquisition agreements, and closer scrutiny of covenant compliance, default and remedy provisions as part of deal structuring.

Preparing for what lies ahead

For businesses, these developments call for governance frameworks, compliance programmes and transaction structures capable of adapting to a shifting regulatory, geopolitical and technological landscape. Resilience in risk oversight, financing strategies and deal structuring tends to leave boards and management teams better placed to manage disruption and pursue opportunities for growth. Well-documented decision-making processes capable of withstanding scrutiny from regulators, shareholders and other stakeholders also play a role.

Against this backdrop, corporate and commercial legal advisers are called on for more than technical legal expertise. They are providing legal analysis with commercial and geopolitical judgement, helping clients structure transactions, manage risk and pursue growth in a complex and interconnected global environment. This favours legal advisers who remain current across multiple, often overlapping regulatory regimes, co-ordinate closely with colleagues in other jurisdictions and practice areas, and integrate fast-moving legal and geopolitical developments into actionable advice.