Firms speed up regulatory change but confidence falls, survey reveals

Compliance and risk teams are implementing regulatory changes at a faster pace than ever before, but confidence in the effectiveness of those efforts is declining, according to a new industry survey. The findings come from CUBE's Cost of Compliance Report 2026, which surveyed more than 2,000 senior compliance and risk professionals across 11 countries.

According to the report, 61 per cent of firms now embed regulatory change within a year, compared with 26 per cent in 2025. Meanwhile, 46 per cent complete an initial impact assessment within two weeks, up from 20 per cent a year earlier. Despite these improvements in speed, confidence has fallen. Just 45 per cent of respondents rated their compliance approach as generally or highly effective, down from 59 per cent in 2025.

The report suggests that organisations are facing increasing complexity as artificial intelligence becomes more widely adopted across compliance and risk functions. While 59 per cent of respondents said AI is embedded or at an advanced stage within core processes, only 34 per cent said they were confident they could demonstrate their AI governance framework to regulators today.

More than half (57 per cent) said they do not yet trust AI outputs for critical decision-making, while 58 per cent expect regulatory scrutiny of AI use to increase over the next year. The volume of regulatory change is also rising. The survey found that 17 per cent of firms now track more than 100 regulatory developments each month, compared with just 2 per cent in 2025.

Ben Richmond, Founder and CEO of CUBE, said: "I read these findings closely every year, and this year what stands out to me is the gap between what firms have deployed at pace with AI and what they can subsequently evidence. The foundations are still being built: just 40 per cent rate their data governance as completely effective, and data quality is the most-cited barrier to scaling AI."

He added: "Speed appears to be outpacing assurance: firms are deploying AI faster than they can govern it, and processing regulatory change faster than they can embed it with confidence."

The research also found compliance costs continue to increase, with 64 per cent of organisations reporting higher costs over the past year, largely driven by technology investment and AI governance requirements.

At the same time, 35 per cent of respondents said senior leaders were stepping back from or leaving roles with direct compliance accountability, rising to 47 per cent in India.

Despite the challenges, attitudes towards AI remain largely positive. Three-quarters of respondents said they expect the technology to free up staff for higher-value activities, while 73 per cent believe it will improve overall effectiveness.

Richmond said: "Firms that close the distance between what they have deployed and what they can evidence will get the most from AI over the next 12 months."

This article is produced by SWNS based on content distributed by GlobeNewswire.