Gartner Says General Counsel Should Plan for Shifts in Regulatory Risk Ahead of U.S. Election

With uncertainty surrounding the impact of the upcoming U.S. presidential election on regulatory agendas worldwide, general counsel (GC) should prepare different scenarios contingent on the result now to anticipate the risks, according to Gartner, Inc.

“GC typically respond to major events or rulings after they occur, but, to plan ahead, GC should analyze which regulations are critical to the business, anticipate the major differences between the two potential administrations, and advise senior leaders and the board on the risks,” said Laura Cohn, Director, Research, in the Gartner Legal and Compliance practice. “Stakeholders will want to know the risks and be prepared for them, no matter what the outcome of the election is.”

Given the differences in regulatory philosophies held by each political party, Gartner recommends GC determine:

·       Which regulations and policies are most critical to the organization

·       Where there is a likely and significant difference between the possible administrations

Considering such factors will help organizations focus their scenario-planning efforts ahead of the November election.

To prepare for election results well before voters go to the polls, GC should use existing regulatory tracking systems to map out the risks and potential changes, prioritizing which regulations are most critical to the business. Companies face a host of risks from political polarization, including legal and regulatory risks as well as economic risks. While some are systemic, meaning they would have an impact on organizations regardless of election outcomes, others are contingent on election results (see Figure 1).

GC can facilitate an assessment of possible regulatory change by asking questions about the organization’s exposure and potential response. It will be key to determine in advance whether there are specific actions the company should take following either election scenario. It is also important to understand how such actions could change as a new regulatory agenda emerges – and also whether acting early will reduce risk.

When these considerations pose medium or high concern, the legal department’s preparation will have a significant impact on the organization’s capacity to respond to the event.

“Companies today face a wider swing in regulatory priorities contingent upon election outcomes than they have in the past,” Cohn said. “Identifying and planning for potential regulatory changes critical to the organization today will help GC and their stakeholders react to post election policy activities.”

Gartner clients can read more in 2024 Elections: How Legal Can Plan for Shifts in Regulatory Risk. Nonclients can access the report, Legal and Compliance Hot Spots to better prepare legal, compliance, and privacy functions through the end of 2025.