About 72% of business leaders worldwide say geopolitical risk is having a direct commercial impact on their operations, up from less than half a year earlier, according to a study by Clyde & Co.

Four in five organisations say geopolitical shifts now influence where and how they operate globally.

The law firm’s Corporate Risk Radar 2026 also shows 86% of company leaders rate technology as high-risk, up from just 46% last year – the biggest year-on-year rise for any risk category.

“As organisations adopt AI at pace, technology risk is rising sharply and extending far beyond the technology function into governance, regulation and reputation,” Clyde & Co says.

“What makes this more than an IT challenge is the way AI adoption has restructured dependency and vulnerability across entire organisations.”

As businesses integrate AI, they become more reliant on concentrated groups of third-party technology providers, the report says.

This can expose companies to cascading failures created by interconnection.

Governance is struggling to keep pace, with 76% of organisations saying AI, data privacy and cybersecurity requirements are moving quickly.

Only 68% have mature AI governance frameworks in place. Nearly eight in 10 leaders say AI and new technology will significantly influence their business over the next five years.

Clyde & Co Australia managing partner Rebecca Kelly says businesses are not only focused on which technologies to adopt, but also how to manage them.

“The challenge for clients has shifted from implementation to control. They are asking what to deploy to keep pace, but equally how to govern its use.

“If you look back 10 years, there were no whistleblower regimes, no governance overhauls, no environmental, social and governance frameworks.

“Those are now embedded in a sound corporate governance structure. AI governance is moving in the same direction.”