Legal departments across U.S. firms are increasingly grappling with a wide range of new legal risks as the business environment becomes more complex. Technology and data governance, climate-strategy disclosure, product-safety compliance, and regulatory transparency are just a few of the legal risk domains that are now demanding attention. A recent executive survey highlights that it is not just external regulatory pressure driving corporate legal strategies; internal operational drivers are also playing a significant role in shaping firms’ responses, particularly when it comes to climate initiatives. This reflects the expanding role of legal teams in influencing business strategy beyond their traditional focus on litigation.
One of the key shifts is the growing importance of technology and data governance. With data breaches, cybersecurity risks, and privacy concerns becoming central to modern business operations, corporate legal teams are now tasked with navigating an increasingly complex web of regulations. These issues often cross international borders, with firms needing to comply with a patchwork of global data protection laws. Legal teams are also at the forefront of ensuring that their companies’ technological infrastructures are secure and compliant with ever-evolving standards.
The pressure on legal departments is further heightened by the rising prominence of climate-strategy disclosure. As climate change becomes a major focus for governments, investors, and the public, companies are facing new mandates to disclose their environmental impact, climate-related risks, and sustainability strategies. A shift is taking place where these initiatives are being driven as much by operational needs as by external regulatory requirements. Companies that are proactive in addressing climate issues are finding themselves better positioned in terms of both compliance and reputation, while those that fall behind may face regulatory scrutiny and increased investor pressure.
Another critical area of concern for legal teams is product safety compliance, highlighted by the recent recall of Ford’s Bronco and Bronco Sport models. This high-profile case exemplifies how product-safety issues can quickly escalate, moving from engineering concerns to boardroom discussions. Legal counsel must now coordinate responses across multiple departments, from operations to communications, all while managing external legal exposure. This interconnected approach is becoming essential as product safety increasingly intersects with broader business strategies and reputational risks.
In addition to these specific areas of concern, large law firms and corporate legal teams are also navigating broader expectations around transparency. A key example is the recently passed legislation requiring the U.S. Department of Justice (DOJ) to disclose certain records that were previously withheld. This new transparency mandate is part of a larger trend that is reshaping how companies handle legal and regulatory disclosures. While this particular legislation may impact multiple industries, it serves as a warning to legal-risk professionals about how transparency dynamics could expand beyond traditional courtroom environments and affect corporate operations.
For in-house legal leaders and law-firm partners alike, the message is clear: managing legal risk today requires a much broader perspective. It is no longer sufficient to focus solely on litigation or compliance; legal departments must now consider regulatory, operational, and reputational risks as part of an integrated strategy. Legal teams are increasingly being called upon to act not only as defense counsel but also as strategic advisers, helping to guide business decisions and ensure that companies are prepared for the rapidly evolving regulatory landscape. This new role for legal departments reflects the changing nature of business risk and underscores the growing importance of legal teams in shaping and supporting corporate strategy.
The evolving landscape requires legal teams to be proactive, adaptable, and knowledgeable in areas that go far beyond traditional legal frameworks. As companies navigate new risks and compliance mandates, legal departments must increasingly take a holistic approach, integrating legal considerations into the strategic decision-making processes of the entire organization. This shift signals a significant transformation in the role of corporate legal teams, from a reactive function to one that is more forward-thinking, dynamic, and integral to overall business success.
