For years, Governance, Risk, and Compliance (GRC) was seen as a necessary burden – a box-ticking exercise to satisfy regulators and auditors. But that perception is changing fast. New studies from 2025 show that technology is transforming GRC from a reactive compliance function into a strategic driver of business performance.

Companies that have digitized their GRC processes report greater transparency, faster audits, and significantly improved risk control. Automation, data integration, and artificial intelligence are helping organizations manage complexity, build trust, and stay compliant — all while saving time and resources.

Key Takeaways

• According to “The State of GRC 2025” report, 96 percent of executives now view GRC as a strategic business enabler.
• McKinsey’s research shows that digital GRC systems can reduce audit preparation time by up to 40 percent.
• Automated risk assessment and real-time monitoring dramatically reduce human error.
• Companies with integrated GRC technology respond faster to crises and regulatory changes.

The Evolution of GRC: From Control Function to Strategic Platform

The past decade has seen a profound transformation in how organizations approach GRC. Spreadsheets, manual checklists, and reactive processes are being replaced by integrated digital platforms that connect data, people, and decisions.

McKinsey’s 2025 report “Governance, Risk, and Compliance: A New Lens on Best Practices” highlights that while many companies have strong governance frameworks, they still struggle with “limited tech enablement.” In contrast, organizations that have digitized their GRC processes see clear benefits — higher efficiency, improved visibility, and stronger accountability.

Similarly, “The State of GRC 2025 – From Cost Center to Strategic Business Driver” finds that nearly all surveyed companies (96 percent) now treat GRC as a core part of their business strategy. Technology integration, AI-driven analytics, and automated reporting are turning GRC into the nervous system of modern corporate governance.

How Technology Strengthens GRC

Technology reshapes GRC on multiple levels — structurally, culturally, and operationally.

1. Automation of Repetitive Tasks
   Routine tasks such as risk documentation, policy tracking, and control testing can now be automated. According to the study “GRC Automation in Manufacturing”, companies using automation reduced compliance-related workloads by up to 70 percent.
2. Centralized Data Integration
   Modern GRC platforms consolidate data from ERP, HR, cybersecurity, and audit systems, creating a single source of truth. This integrated view allows leaders to identify interdependencies and manage risks proactively rather than reactively.
3. Real-Time Monitoring and Early Warning Systems
   Real-time analytics enable organizations to detect and respond to risks faster. Automated alerts and risk scoring tools transform GRC from an after-the-fact reporting function into a dynamic early warning system.
4. Collaboration Through Digital Workflows
   Cloud-based GRC solutions promote collaboration across departments. Tasks, reviews, and approvals flow through unified digital workflows, increasing transparency and accountability.
5. Artificial Intelligence and Predictive Analytics
   AI-powered platforms can detect anomalies, analyze emerging threats, and forecast potential compliance breaches. Predictive insights help organizations shift from reactive compliance to proactive prevention.

Measurable Impact: What the Studies Show

The business impact of GRC technology is now quantifiable — and the numbers are compelling.

• McKinsey reports that digitized GRC processes reduce audit preparation times by up to 40 percent.
• The “GRC Automation in Manufacturing” study found that automation can save up to 70 percent of compliance reporting time.
• Financier Worldwide notes that GRC platforms deliver major efficiency gains in third-party and supply chain risk management.
• The Wolfpack Risk “State of GRC 2025” report found that companies with integrated GRC systems respond twice as fast to critical incidents as those relying on manual processes.

In short: GRC is no longer an administrative function — it has become a data-driven management discipline.

Technology as the Enabler of a New GRC Culture

While technology provides the tools, success depends on people and culture. True transformation happens when organizations integrate technology into their governance structures, leadership practices, and decision-making processes.

Companies that view GRC as a shared responsibility — not just a compliance task — achieve not only better control but also greater agility. Digital platforms create visibility, but leadership and culture turn that visibility into trust and accountability.

In 2025, GRC technology is more than an efficiency booster — it’s the backbone of organizational resilience.

Conclusion

In 2025, GRC is no longer a burden; it’s a competitive advantage. Technology enables organizations to connect governance, risk, and compliance in a single digital ecosystem — reducing complexity, accelerating decisions, and building long-term trust.

Those who invest in digital GRC today are not just staying compliant — they are shaping a smarter, safer, and more transparent future. The shift is clear: from obligation to opportunity.

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FAQ

What does GRC technology mean in practice?
It refers to digital systems that centralize, automate, and monitor governance, risk, and compliance processes — such as integrated GRC platforms, AI-driven analytics, and automated audit tools.

What are the main benefits of GRC platforms?
They reduce manual effort, increase transparency, identify risks in real time, and simplify regulatory reporting.

Which studies confirm these effects?
Key sources include McKinsey (2025), Wolfpack Risk (2025), Financier Worldwide (2025), and GRC Automation in Manufacturing (2025).

Is technology alone enough for effective GRC?
No. Technology must be combined with clear governance structures, defined responsibilities, and a risk-aware culture.

Which industries benefit the most from digital GRC?
Financial services, manufacturing, logistics, healthcare, and other highly regulated sectors benefit most from integrated, technology-enabled GRC systems.

In August 2025, an unexpected disruption to PayPal’s systems caused a significant impact on payment processing in Germany. A malfunction in PayPal’s fraud detection logic resulted in German banks blocking SEPA direct debits worth more than €10 billion. Many customers and merchants were affected, experiencing delayed payments, declined withdrawals, and negative balances. PayPal attributed the issue to a technical error triggered by a system update and has promised automatic refunds as well as close cooperation with affected financial institutions to fully resolve the situation.

Key Takeaways

• System update caused PayPal’s fraud detection to fail on August 23/24, 2025
• German banks blocked direct debits totaling over €10 billion
• Customers faced rejected payments, negative balances, and blocked transactions
• PayPal fixed the error, issued refunds, and warned of phishing attempts following the disruption
• The incident highlights the tight connection between technology, governance, and payment risk – and showcases critical GRC improvement areas

What Happened?

On the weekend of August 23/24, 2025, a scheduled system update disabled PayPal’s automated fraud detection. As a result, direct debit transactions were sent to banks without proper verification, prompting institutions to block them as a security measure. This led to a widespread payment freeze: online merchants couldn’t process transactions, and users faced failed payments or unexpected charges. While there is no confirmed hacker involvement, reports surfaced of PayPal credentials being sold on the dark web – suspected to stem from malware on customer devices rather than a breach of PayPal’s core systems.

Root Causes

Governance Gaps

The change appears to have been implemented without adequate risk assessment, simulation, or executive oversight. Emergency protocols for rollback or escalation were missing or not activated.

Risk Blind Spots

Deploying a system update without robust live simulations or rollback options is high risk. Automated fail-safes and emergency escalation plans were either ineffective or not in place.

Compliance and Testing Shortfalls

PayPal had fraud prevention policies in place, but the technical resilience of these measures proved insufficient. Regular audits, payment flow testing, and anomaly detection systems appear to have been lacking.

How It Could Have Been Prevented

• Controlled Testing Environments: All updates should be fully tested in isolated environments with clear rollback options before deployment.
• Emergency Governance: Strong change management with predefined escalation chains and real-time alerts for deviations.
• Advanced Monitoring: Health checks, automated rollback triggers, and anomaly detection systems running 24/7.
• Stakeholder Communication: Real-time status updates for banks, merchants, and customers to reduce confusion during outages.
• Integrated GRC Audits: Regular simulations and comprehensive GRC audits to assess system readiness and response capabilities.

Conclusion

The August 2025 PayPal outage is a powerful reminder that system updates in payment infrastructures carry systemic risk. It underscores the need for tightly integrated governance, risk management, and compliance processes to ensure continuity. Organizations should treat this disruption as a wake-up call to review their GRC strategies, conduct scenario testing, and establish robust contingency plans.

FAQ

1. Why did German banks block payments?
Due to a system error, PayPal sent unverified debit requests. Banks acted preventively to avoid potential fraud.

2. Was it a hacker attack?
No. PayPal confirmed the issue was internal and not caused by external intrusion.

3. How many users were affected?
PayPal reported that fewer than five percent of German customers were directly impacted, but the scale of payment disruptions was significant.

4. How did PayPal respond?
PayPal fixed the issue, issued refunds, and is working with banks to clear the backlog. The company also warned users about phishing attempts in the aftermath of the outage.

5. What should other companies learn from this?
Major infrastructure changes should be guided by strict change management, GRC-driven risk assessments, constant monitoring, and robust backup strategies – especially in critical sectors like payments.

Intro

Wolfspeed, once celebrated as a pioneer in silicon carbide (SiC) semiconductor technology, is preparing for a Chapter 11 bankruptcy. The company had aggressively expanded its production capacity in anticipation of surging demand from the electric vehicle (EV) sector. However, growth expectations fell short, and the business model collapsed under mounting pressure from market forces and internal strategic missteps.

This article examines the underlying causes of Wolfspeed’s crisis, explores how the absence of robust Governance, Risk, and Compliance (GRC) structures contributed to the situation, and outlines what organizations can learn from this high-profile failure.

1. Wolfspeed’s Trajectory: Ambition Meets Vulnerability

Wolfspeed emerged from Cree Inc. and quickly rose to global prominence as a leading supplier of silicon carbide power semiconductors. With EV adoption growing and governments subsidizing electrification, Wolfspeed positioned itself as a critical player in this evolving landscape.

The company embarked on a capital-intensive expansion, including a $5 billion fab in North Carolina and a wafer facility in Germany. This growth was financed almost entirely through debt, with more than $6 billion in liabilities accumulated by 2025.

2. Key Drivers of the Financial Collapse

a) Overestimation of Market Demand

Wolfspeed built its growth model on the assumption of sustained EV adoption. Yet, by late 2024, automakers in North America and Europe began scaling back their production forecasts, citing stagnating EV sales. Wolfspeed’s order volumes declined, and in early 2025, the company publicly acknowledged “substantial doubt” about its ability to continue as a going concern.

b) Excessive Leverage and Capital Commitments

Wolfspeed’s debt-financed expansion left it highly vulnerable to rising interest rates and market volatility. With $6.5 billion in debt and only $1.3 billion in cash reserves, the company faced significant liquidity constraints.

c) Intensifying Competition – Especially from China

Chinese competitors such as SICC Co., TanKeBlue, and San’an Optoelectronics significantly expanded their SiC wafer production capacity with strong state support. By 2025, the price of SiC wafers had dropped by up to 30%, driven by Chinese firms’ low-cost strategies. Wolfspeed, operating in high-cost regions, was unable to match these prices and began losing market share.

d) Delays in Government Subsidies

Wolfspeed had banked on U.S. CHIPS and Science Act subsidies, expecting up to $750 million in public funding. However, bureaucratic delays and regulatory hurdles meant that funds were slow to materialize, exacerbating the company’s funding gap.

e) Strategic Management Failures

Wolfspeed remained committed to its expansion strategy despite multiple warning signs—declining customer demand, deteriorating free cash flow, and growing competition. There was little evidence of active scenario planning or risk-based adjustment of the company’s investment pipeline.

3. GRC Failures That Amplified the Crisis

Although market conditions clearly played a role, Wolfspeed’s internal systems failed to identify, assess, and respond to emerging risks effectively. The absence of a mature GRC framework left the company structurally exposed.

Governance

• No evidence of strategic scenario planning to evaluate alternative market trajectories.
• Weak board oversight over leverage, capital allocation, and risk exposure.
• Delayed response to operational signals such as revenue declines and customer attrition.

Risk Management

• No clearly defined debt ceilings or investment triggers tied to demand indicators.
• Lack of stress testing to assess interest rate sensitivity or price erosion scenarios.
• Insufficient market intelligence on global competitors and supply chain risks.

Compliance

• Delays in fulfilling conditions for government subsidy disbursements.
• Reactive investor communication, which eroded stakeholder trust.
• No integrated approach to ESG-related risks in global operations.

4. How Strong GRC Could Have Made a Difference

A well-implemented GRC framework would not have guaranteed success—but it would have provided critical foresight, agility, and resilience to manage through adversity.

GRC Component	Preventive Measure	Potential Impact
Governance	Early warning systems and scenario-based reviews	Strategic course correction before financial instability
Risk	Stress testing, debt control, risk-adjusted investment policy	Improved capital discipline and market responsiveness
Compliance	Active subsidy tracking, stakeholder communications	Preservation of creditworthiness and investor confidence
Reporting	Monthly KPI dashboards on operational and financial risk	Transparency for executives and creditors alike

5. Conclusion and Strategic Lessons

Wolfspeed’s crisis is a cautionary tale for high-growth industrial firms. Even with advanced technology and a favorable policy environment, overconfidence and poor risk oversight can derail long-term success.

As Wolfspeed enters Chapter 11, it will attempt to restructure and emerge as a leaner, more stable entity. But the damage—particularly for shareholders and suppliers—is already significant.

The lesson is clear: GRC is not merely a compliance obligation. It is a critical management function that enables informed decisions, protects against overreach, and builds resilience in a volatile global economy.

FAQ – Wolfspeed’s Insolvency and the Role of GRC

What does Wolfspeed do?
Wolfspeed manufactures silicon carbide (SiC) power semiconductors used in electric vehicles, energy infrastructure, and industrial systems.

Why is Wolfspeed in financial trouble?
The company overinvested based on overestimated EV demand, while accumulating excessive debt. At the same time, Chinese competitors eroded market prices, and public subsidies were delayed.

What is Chapter 11?
Chapter 11 is a U.S. bankruptcy process that allows companies to reorganize under court protection without ceasing operations.

How did Chinese competitors impact Wolfspeed?
Chinese producers flooded the market with subsidized SiC wafers, causing prices to fall sharply. Wolfspeed could not compete on cost and lost market share.

Could a strong GRC system have prevented this?
While not a panacea, a robust GRC system would likely have flagged critical risks earlier, supported better decision-making, and protected key stakeholder relationships.

What should other companies take away from this?

• Link capital investments to validated demand indicators.
• Run regular stress tests on liquidity, interest exposure, and market share erosion.
• Use GRC tools not just for compliance, but as an integrated part of strategic planning.

The acquisition of Monsanto by Bayer in 2018 was a landmark deal in the global agribusiness industry. Bayer, a leading player in pharmaceuticals and agricultural chemicals, paid approximately $63 billion to acquire Monsanto – a company known primarily for its herbicides, particularly the product Roundup. However, what started as a strategic move to expand its portfolio quickly turned into a nightmare filled with legal and financial challenges. The controversial connection between Bayer and Monsanto has led to a series of lawsuits, putting the company under significant financial strain and causing reputational damage.

In this blog post, we will break down Bayer’s acquisition of Monsanto, the challenges surrounding Glyphosate, and the consequences faced by the company. Additionally, we will explore how better Governance, Risk, and Compliance (GRC) systems might have helped Bayer avoid or mitigate the crisis.

1. The Acquisition of Monsanto: A Strategic Move or a Risky Play?

When Bayer announced the acquisition of Monsanto in 2018, the company was seeking to strengthen its position in the agribusiness sector. Monsanto, an American multinational, was a global leader in genetically modified seeds and crop protection chemicals, especially the herbicide Glyphosate. Glyphosate was the key ingredient in Roundup, which had become an essential product for agriculture and industry worldwide.

Bayer saw the acquisition as an opportunity to establish leadership in the global agribusiness market and take advantage of synergies between Bayer’s existing products and Monsanto’s innovations in seed development and crop protection.

Strategic Objectives:

• Market Leadership in Agribusiness: The acquisition was intended to position Bayer as a dominant player in the global agribusiness market.
• Product Portfolio Synergies: Bayer aimed to combine its products with Monsanto’s to develop a more comprehensive offering in plant protection and biotechnology.

However, the purchase of Monsanto was not without risks – and one major risk was already well-known: Glyphosate.

2. Glyphosate and the Lawsuits: A Ticking Time Bomb

Glyphosate, the active ingredient in Roundup, had been one of the most widely used herbicides since its introduction in the 1970s. However, in recent years, Glyphosate has come under increased scrutiny. In 2015, the International Agency for Research on Cancer (IARC), a branch of the World Health Organization (WHO), classified Glyphosate as “probably carcinogenic.”

Starting in 2016, lawsuits began to pile up in the United States, with plaintiffs claiming that Glyphosate had caused cancer. This led to a wave of litigation, with more plaintiffs joining the legal battle over time. Despite Monsanto’s repeated defense of Glyphosate’s safety, concerns over its potential cancer-causing effects fueled the lawsuits.

Bayer, despite being aware of the risks, went ahead with the acquisition of Monsanto – perhaps under the assumption that the legal challenges would not be as severe. However, the actual impact was far greater.

3. The Impact on Bayer: Financial and Reputational Damage

Financial Strain: The legal battles surrounding Glyphosate have placed Bayer under significant financial strain. In 2020, the company announced that it would allocate more than $11 billion to settle Glyphosate-related lawsuits in the United States. However, this was only part of the financial burden. Bayer continues to face ongoing lawsuits, and the outcome of future litigation remains uncertain.

Reputational Damage: Bayer also faced severe reputational damage. The acquisition of Monsanto had already drawn significant criticism, and the continued use of Glyphosate in many markets only intensified opposition from consumer protection groups and environmental activists.

The loss of public trust and the negative media coverage severely impacted Bayer’s stock price, leading to a decline in investor confidence.

4. How Better GRC Could Have Prevented or Mitigated the Situation

An effective Governance, Risk, and Compliance (GRC) system could have helped Bayer better identify and assess the risks associated with acquiring Monsanto and the long-term financial and legal consequences. A robust GRC framework would have provided Bayer with a clearer picture of the potential challenges, allowing for better decision-making and risk management strategies.

4.1 Early Risk Assessment and Awareness

A stronger GRC system could have allowed Bayer to more accurately identify and assess the legal risks associated with Glyphosate. If Bayer had conducted a more thorough risk assessment, it might have reconsidered the acquisition or at least taken additional steps to mitigate the risks involved.

4.2 Enhanced Due Diligence

The due diligence process conducted before the acquisition could have been more focused on the ongoing legal battles. A more comprehensive GRC system would have likely flagged the legal risks and provided a more realistic picture of the potential future liabilities.

4.3 Long-Term Risk Management

A proactive approach to long-term risk management could have helped Bayer better navigate the financial strains associated with the ongoing lawsuits. Bayer could have developed a clearer strategy for mitigating the financial risks and communicating the benefits of Glyphosate and its safety more effectively.

4.4 Ethics and Regulation

A more robust GRC framework would have also encouraged Bayer to consider the ethical and regulatory implications of continuing to rely on Glyphosate. By assessing not only the legal risks but also the societal and regulatory dimensions of the issue, Bayer might have been able to better anticipate the public backlash and regulatory challenges.

5. Why Bayer Is Considering Bankruptcy for Monsanto

In light of the ongoing high number of lawsuits and the financial strain, Bayer is now considering the possibility of pushing Monsanto into bankruptcy to alleviate the burden of ongoing legal disputes. Bankruptcy could allow Bayer to manage the legal proceedings in a way that minimizes its financial obligations.

However, such a move would not only severely damage Bayer’s reputation but could also lead to further legal and regulatory challenges. The political and public backlash from filing for bankruptcy could also have long-term consequences for Bayer’s brand and market standing.

Conclusion: A Vicious Cycle of Strategy, Risk, and GRC Failures

Bayer’s acquisition of Monsanto was a risky move from the outset, with financial, legal, and reputational challenges already on the horizon. An improved GRC system could have helped Bayer better understand the risks involved and allowed the company to make more informed decisions. The situation serves as a cautionary tale for businesses considering large acquisitions or entering industries with significant regulatory and societal challenges. An effective GRC framework is essential for identifying, assessing, and managing risks to ensure long-term success.

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FAQ on Bayer, Monsanto, and Glyphosate

1. Why did Bayer acquire Monsanto despite the legal issues surrounding Glyphosate?

Bayer acquired Monsanto to strengthen its position in the agribusiness sector and take advantage of synergies between its own products and Monsanto’s innovations. While Bayer was aware of the risks associated with Glyphosate, it believed these could be managed effectively and that the acquisition would be beneficial in the long term.

2. What is the issue with Glyphosate?

Glyphosate, a key ingredient in Roundup, was classified by the International Agency for Research on Cancer (IARC) as “probably carcinogenic.” This has led to a series of lawsuits, where plaintiffs claim that exposure to Glyphosate caused cancer, resulting in significant legal challenges for Monsanto (and later Bayer after the acquisition).

3. How much did Bayer pay for the acquisition of Monsanto?

Bayer acquired Monsanto for approximately $63 billion in 2018, marking one of the largest deals in the history of the chemical and agricultural industries.

4. What are the financial impacts of the Glyphosate lawsuits on Bayer?

The ongoing legal battles have cost Bayer billions of dollars. In 2020, Bayer set aside $11 billion to settle lawsuits in the U.S., but the financial strain continues with further litigation ongoing.

5. How could better GRC have helped Bayer avoid or mitigate the situation?

An improved GRC system could have helped Bayer better assess the risks associated with the Glyphosate litigation, conduct a more thorough due diligence process, and implement proactive long-term risk management strategies. It would also have helped Bayer consider the ethical and societal implications of continuing to rely on Glyphosate.

6. Why is Bayer considering bankruptcy for Monsanto?

Due to the overwhelming legal and financial burden from the ongoing lawsuits, Bayer is considering pushing Monsanto into bankruptcy to manage these liabilities. This move could help alleviate financial pressure, but it would have severe reputational consequences for Bayer.

7. What would bankruptcy for Monsanto mean for Bayer?

Bankruptcy would provide Bayer with some legal relief, but it would also cause significant reputational damage. It could further erode public trust in the company and lead to additional legal and regulatory challenges.

8. What can other companies learn from Bayer’s experience?

Bayer’s situation highlights the importance of thorough risk management and the need for strong Governance, Risk, and Compliance (GRC) systems. Businesses should carefully assess the long-term risks associated with large acquisitions and consider the ethical, legal, and reputational implications of their decisions. A robust GRC system is essential for protecting a company’s long-term viability and success.

The aviation industry is undergoing one of its most significant transformations: Boeing and Airbus are splitting the major U.S. supplier Spirit AeroSystems between them. This historic deal raises key questions about the strategic reasons behind the takeover and highlights the Governance, Risk, and Compliance (GRC) challenges that come with it.

Why Are Boeing and Airbus Acquiring Spirit AeroSystems?

1. Quality Issues and Production Deficiencies

In recent years, Spirit AeroSystems has faced repeated negative headlines due to severe quality issues in aircraft component manufacturing. For Boeing, defective parts in the 737 MAX series and a serious incident in early 2024 triggered the need to regain control over critical production processes. Addressing these quality concerns was a primary driver behind Boeing’s acquisition.

2. Supply Chain Stabilization

Global aviation has been struggling with fragile supply chains since the pandemic. As one of the largest suppliers, Spirit AeroSystems became a critical — but increasingly risky — link. Both Boeing and Airbus aim to reduce dependency on external suppliers and secure their production stability through this takeover.

3. Strategic Realignment and Vertical Integration

The industry trend is shifting back toward vertical integration. Boeing is investing approximately $4.7 billion to bring former divisions back in-house. Airbus is acquiring only those Spirit sites dedicated to producing components for Airbus models. Both companies are securing essential resources and expertise for future competitiveness.

GRC Challenges: Key Tasks Following the Takeover

The acquisition of Spirit AeroSystems offers operational advantages but also presents significant Governance, Risk, and Compliance (GRC) challenges.

1. Governance: Establishing Clear Structures

With the integration of Spirit facilities, Boeing and Airbus must implement new governance frameworks. Defining responsibilities, reporting lines, and control mechanisms is crucial to ensure transparency and prevent mismanagement.

2. Risk Management: Minimizing Quality and Supply Chain Risks

Spirit AeroSystems’ history demonstrates how quickly quality failures can lead to severe financial and reputational damage. A robust risk management system is essential to monitor production processes and detect supply chain risks early.

3. Compliance: Navigating Complex Regulatory Landscapes

With sites in the USA, Europe, and Morocco, Boeing and Airbus face a wide range of regulatory requirements. Labor laws, environmental regulations, export controls, and industry standards must all be addressed. A global yet locally adapted compliance framework is vital.

Conclusion: Opportunity and Responsibility

The takeover of Spirit AeroSystems by Boeing and Airbus represents a strategic move to stabilize supply chains and improve production quality. However, the GRC challenges must not be underestimated. Only with strong governance, effective risk management, and strict compliance can both companies turn this bold move into lasting success.

FAQ: Spirit AeroSystems Takeover by Boeing and Airbus

What is Spirit AeroSystems?
Spirit AeroSystems is one of the world’s largest manufacturers of aircraft components, supplying both Boeing and Airbus.

Why was Spirit AeroSystems split?
Due to ongoing quality issues and supply chain risks, Boeing and Airbus decided to split Spirit to gain greater control over critical production areas.

How much is Boeing paying for Spirit AeroSystems?
Boeing is acquiring the majority of Spirit for approximately $4.7 billion.

Which sites is Airbus taking over?
Airbus is acquiring facilities in Belfast, Prestwick, Morocco, France, and parts of the USA that exclusively supply Airbus programs.

What are the GRC challenges associated with the takeover?
The main challenges include establishing clear governance structures, minimizing quality and supply chain risks, and ensuring compliance with international regulations.

What does the takeover mean for the aviation industry?
The acquisition strengthens Boeing’s and Airbus’s market positions but could reduce competition among suppliers and put pressure on smaller vendors.

Introduction: What Does Easter Have to Do with Compliance?

At first glance, Easter and compliance seem worlds apart. One conjures images of springtime, colorful eggs, and the message of rebirth and hope, while the other is often associated with rules, regulations, and restraint. But a closer look reveals a symbolic connection: just like life, compliance too sometimes needs a fresh start.

Spring is a time of renewal – and companies, too, must regularly reflect on and update their structures, values, and processes to stay future-ready. This article explores how the message of Easter can inspire a more forward-looking approach to Governance, Risk, and Compliance (GRC) – and why it’s time to transform compliance culture at its core.

1. Outdated Compliance Structures: When Good Friday Becomes Business as Usual

Many organizations are still burdened by legacy systems, siloed data, and a compliance culture built around fear, control, and reaction, rather than responsibility, prevention, and transparency. These outdated structures have grown over the years and now weigh down companies like a cross they’re forced to carry.

Common signs of “Good Friday” compliance structures:

• Overly complex rulebooks with little practical relevance
• Ineffective communication between risk management, audit, and business units
• Low employee engagement with compliance topics
• Reactive instead of preventive mindsets

Bottom line: These structures can stifle innovation and erode trust – they are in urgent need of transformation.

2. The Turning Point: Risk as a Catalyst for Renewal

Easter doesn’t only symbolize an end – it marks a new beginning. Similarly, crises, regulatory shifts, or reputational setbacks can serve as turning points for companies. Rather than merely mitigating damage, the true opportunity lies in embracing change and rethinking the organization’s compliance DNA.

Why risk is now a strategic issue:

• Cybersecurity, ESG regulation, supply chain laws, and AI compliance make risk management a C-suite priority.
• Companies that proactively manage risks build stronger relationships with investors, customers, and employees.
• Transparent governance structures foster clarity, confidence, and accountability.

3. Rebirth of Compliance Culture: From Control to Commitment

Today’s GRC strategy is no longer about red tape – it’s about mindset and values. A modern compliance culture promotes ownership, digital efficiency, open communication, and above all: trust.

Key success factors for a “reborn” compliance culture:

• Digital tools & automation: Smart systems reduce routine work and free up capacity for strategy and foresight.
• Human-centricity: Employees don’t just follow rules – they understand and internalize them.
• Ethics & transparency: Companies act with integrity, inside and out.

Example:
A company introduces a digital whistleblower system, supported by internal values-based training. The result? More reporting activity, faster responses – and stronger trust in leadership.

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4. Governance as the Easter Message: Compliance as Part of Corporate Purpose

Easter is a celebration of hope, forgiveness, and future possibilities. In today’s complex world of ever-growing regulations and uncertainties, a modern GRC strategy is more than a shield – it’s a reflection of a company’s ethical compass.

Governance in 2025 means:

• Long-term vision instead of short-term risk avoidance
• Accountability instead of blame
• Purpose over policy

Compliance becomes an integral part of sustainable leadership.

Conclusion: Time for a Corporate Spring

Easter reminds us every year that change is not only possible – it’s essential. In the world of governance, risk management, and compliance, this change is long overdue. Companies that dare to question outdated structures and rebuild their compliance culture from the ground up pave the way for trust, resilience, and future-readiness.

Now is the time to dust off your GRC strategy and turn it into a living culture rooted not just in rules, but in purpose.

Tariffs are among the most hotly debated instruments of trade policy. In particular, the imposition of additional tariffs by the U.S. government under Donald Trump has been making headlines in recent years, and continues to do so. The impact of these protectionist measures was—and still is—felt on multiple fronts, both by the U.S. economy and by trading partners affected by these tariffs. What concrete effects have Trump’s tariffs had on the U.S. and on other countries? What historical examples of tariffs exist, and how successful were they? And to what extent are today’s companies being called upon to adapt their Governance, Risk, and Compliance (GRC) structures to cushion against such risks? This article takes a detailed look at these questions.

Trump’s Tariffs and Their Economic Impact

Under the Trump administration, the phrase “America First” became a central slogan. In the context of trade policy, it meant protecting domestic industries and reducing the trade deficit. Accordingly, President Trump announced early on his intention to impose punitive tariffs on a range of imported goods.

Particularly high-profile were—and remain—the tariffs on steel and aluminum from various countries. China repeatedly came under the U.S. spotlight because, according to Trump, there were massive trade imbalances. These tariffs quickly led to countermeasures and retaliatory tariffs. Countries like China and EU member states struck back by introducing their own tariffs on U.S. products, such as agricultural goods and certain consumer products.

The consequences within the U.S. emerged on several levels. On the one hand, certain U.S. industries benefited from a temporary competitive advantage. Steel producers, for instance, suddenly faced less competition, leading to a greater domestic market share. On the other hand, many companies that process steel (for example in the automotive and machinery sectors) saw production costs increase, ultimately resulting in higher prices for end consumers. In addition, U.S. exporters in sectors like agriculture suffered significant losses, as retaliatory tariffs effectively “shut out” key export markets. U.S. farmers in particular complained about lost revenue because products such as soybeans and other agricultural goods became subject to higher duties in countries like China.

For trading partners—from China to the EU to Canada and Mexico—these tariffs primarily meant higher prices in the U.S. market. This shrinks their market share and puts export-sector jobs at risk. At the same time, many foreign companies are forced to focus on other markets or seek workarounds. Overall, these processes are driving a realignment of global supply chains. Multinational companies, in particular, are reassessing their sourcing and production structures to avoid being overly affected by U.S. tariffs and possible retaliatory measures.

Historical Examples of Tariffs and Their Success

While Donald Trump became particularly well-known for his aggressive tariff policy, relying on punitive tariffs is not new. A frequently cited example from economic history is the Smoot-Hawley Tariff of 1930. During the Great Depression, the U.S. government under President Herbert Hoover raised tariffs on numerous imported goods in hopes of protecting domestic agriculture and industry.

However, this strategy proved counterproductive. Several trading partners responded with countermeasures, sparking a veritable “tariff war.” The resulting exchange of tariffs reduced global trade overall and ultimately exacerbated the economic crisis of the 1930s. While the global economy today is not directly comparable to that era, it illustrates that protectionist policies may have short-term effects but often lead to a downward spiral in the long run, given that countermeasures and trade barriers also affect one’s own economy.

Another example is the “Chicken War” of the 1960s between the U.S. and the European Community. Both sides imposed tariffs on poultry and other products, resulting in a diplomatic freeze and higher prices. This conflict exhibited many of the same patterns later seen under Trump: countermeasures, trade diversion, and costly legal disputes before international bodies.

The Role of GRC in the Context of Tariffs

Companies operating in multiple countries must protect themselves from economic and political risks. When governments impose tariffs on short notice or renegotiate international trade agreements, the situation can change drastically in a very short time.

Tariffs or other protectionist measures are not just temporary disruptions; they can have far-reaching consequences for supply chains, production costs, and markets. A carefully designed Governance, Risk & Compliance (GRC) system enables companies to respond to these challenges in a targeted way. The three core areas of Governance, Risk, and Compliance operate like gears that must mesh seamlessly in order to manage crises or political upheavals successfully. Below, you’ll learn what a strong GRC framework looks like and what specific steps each area can take.

Governance: Clear Structures for Rapid Decisions

Governance refers to the leadership and organizational structures responsible for strategic decisions. A robust governance framework features transparency and clear responsibilities so that management can react quickly to trade barriers or changes in tariffs.

• Central Steering Committee: In the face of looming tariffs or other political risks, it can be helpful to establish a dedicated “trade committee” or crisis team. This body evaluates information related to tariffs, coordinates departments such as purchasing, logistics, and finance, and makes timely decisions.
• Clear Escalation Paths: If supply chains are threatened, problems must be communicated swiftly to top management. A well-designed governance model specifies to whom employees should report in various situations, ensuring that necessary strategic changes or investment decisions can be made quickly.
• Strategic Alignment: Governance also involves adjusting business strategy to changing conditions. If import costs rise, for instance, the company may decide to relocate production steps domestically or specifically target investments in new markets. Strong governance ensures that such measures are coordinated and not implemented in isolation.

Example: If a U.S. company learns that tariffs on steel imports from Canada are in the pipeline, an effective governance body would immediately convene all relevant stakeholders. This group would examine whether to diversify existing steel suppliers, renegotiate with Canadian partners, or temporarily increase inventory.

Risk Management: Identifying and Mitigating Threats

Without solid risk management, companies could be caught off guard by tariffs literally overnight. A professional process of risk analysis and control ensures that such developments are identified early and that adequate countermeasures can be prepared.

• Continuous Monitoring: Effective risk management continuously monitors relevant markets, political developments, and legal frameworks. This allows the company to anticipate the likelihood of new tariff regulations early on and develop contingency plans.
• Scenario Analysis and Stress Tests: Many companies use scenario planning to be better prepared. They run through various assumptions—for example, what would happen if a 25% tariff on steel were introduced? The results of these analyses help to prioritize response options.
• Supplier Diversification: The more flexible a company’s sourcing strategy, the less severe the risk if a particular country is subject to tariffs. Good risk managers typically maintain multiple suppliers in different regions and negotiate framework agreements to cushion short-term price increases.
• Insurance Solutions: In some industries, political risks (Political Risk Insurance) can be partly insured. Though not always possible, it demonstrates that risk management extends beyond procurement and logistics, covering financial and legal aspects as well.

Example: A global automotive supplier sources aluminum from Mexico and China. Its risk management identifies the possibility that the U.S. might impose tariffs on aluminum products. By strategically expanding European and Southeast Asian suppliers, the company reduces its dependence on those markets. Should tariffs actually be introduced, it can quickly switch to alternative suppliers.

Compliance: Lawful Conduct in All Tariff and Trade Matters

Compliance means ensuring that a company adheres to all relevant laws, regulations, and internal guidelines. Especially in the wake of punitive or retaliatory tariffs, new laws and regulations often emerge. A robust compliance management system is vital to avoid unnecessary legal pitfalls.

• Customs and Export Regulations: Once tariffs are in effect, the associated tariff rates and product classifications often change. An effective compliance system monitors these changes in real time and updates internal processes (e.g., product coding, documentation) accordingly.
• Proactive Training: Employees in purchasing, logistics, and sales need to be trained to implement new regulations correctly. Compliance training imparts the necessary knowledge of documentation requirements, customs procedures, and deadlines.
• Transparent Documentation: A seamless record of imported goods is essential. Modern compliance tools ensure that all customs documents, product certificates, and delivery records are readily available. In case of inspections or legal disputes, the company can provide evidence of all transactions.
• Ethics and Integrity: Compliance encompasses not only adherence to laws but also ethical and sustainable dealings with business partners. In an environment where tariffs create political tensions, a clear commitment to fair business practices can strengthen the trust of partners and customers.

Example: After China introduces new retaliatory tariffs, a U.S. company must adapt its export documentation to the revised regulations. The compliance team informs everyone involved about the new HS codes (Harmonized System Codes) and ensures that no incorrect information is submitted during customs clearance. This helps prevent legal conflicts and reduces financial risks from potential fines or delivery delays.

How the Three GRC Pillars Work Together for a Robust Business Strategy

The real power of a GRC system only emerges when Governance, Risk Management, and Compliance work hand in hand. Risk management, which identifies new tariff risks, will only be effective if good governance structures enable swift responses and if robust compliance management ensures a solid legal foundation.

This synergy is crucial when international conflicts arise and governments impose tariffs on short notice. Only a company that knows its decision-making pathways and obligations (Governance), has tested possible scenarios (Risk Analysis), and rigorously complies with all regulations (Compliance) can act confidently in such situations.

Concrete Example of an Integrated GRC Response:

1. Risk Management analyzes initial indications of planned tariff increases and recommends building up inventory and reducing dependence on the affected import country by seeking alternative suppliers.
2. Governance convenes a crisis team to evaluate these recommendations and decide—within a very short period—whether and how the company should invest. Relevant departments (purchasing, production, logistics) are then informed.
3. Compliance reviews the required formalities for switching suppliers and ensures that all documentation and declaration obligations are met in order to comply with legal requirements.

Such an approach significantly reduces the likelihood of unpleasant surprises, high additional costs, or even supply failures.

Conclusion: Tariffs, Protectionism, and Corporate Strategies

Trump’s tariffs have shown how quickly protectionist measures can upend global supply chains. While individual sectors in the importing country can benefit in the short term, most companies face greater uncertainty and many consumers end up paying higher prices. Historical examples such as the Smoot-Hawley Tariff or the “Chicken War” show that import tariffs usually trigger countermeasures and put global trade under pressure.

In a networked world, we can expect tariffs to continue to be used as a means of exerting pressure. Companies would therefore do well to align their Governance, Risk, and Compliance processes in such a way that they can respond swiftly and flexibly. A mature GRC framework enables early risk detection, supports lawful conduct, and ensures transparent corporate leadership. In doing so, companies lay the foundation to remain successful even in turbulent trade environments.

In a world marked by geopolitical tensions, economic uncertainties, and technological disruptions, Governance, Risk & Compliance (GRC) is becoming increasingly crucial. Businesses are facing unprecedented challenges: geopolitical tensions are escalating, regulatory requirements are tightening, and technological advancements—especially in artificial intelligence (AI)—are rapidly reshaping existing business models. In this article, we will highlight why strong GRC management is not only essential for survival but also a key competitive advantage.

1. Political Uncertainties and Protectionism

The re-election of Donald Trump as U.S. President brings with it a renewed focus on protectionist economic policies. Trade conflicts, tariffs, and national interests are once again taking center stage. This means that globally operating companies must rethink their supply chains and compliance strategies. Additionally, uncertainties in EU politics, such as the future direction of economic policy and potential new trade barriers, add further complexity.

GRC Solution: Companies must adapt their compliance and risk management strategies to be prepared for protectionist measures. A flexible GRC system helps businesses quickly adjust to regulatory changes and identify risks at an early stage.

2. Geopolitical Tensions and Crises

The war in Ukraine and other geopolitical conflicts, such as tensions in the South China Sea, have massive impacts on markets and supply chains. Sanctions and political unrest create economic uncertainty and require strategic risk assessments.

GRC Solution: Companies need a dynamic risk management approach that continuously monitors political changes and provides risk mitigation scenarios. GRC software can assist through real-time monitoring and integrated risk assessment, allowing businesses to respond proactively to geopolitical developments.

3. Economic Uncertainties and Inflation

Rising inflation rates, volatile financial markets, and uncertain economic outlooks pose significant challenges for businesses. At the same time, regulatory pressures are increasing across various industries, forcing companies to engage more intensively with governance and compliance issues.

GRC Solution: A structured GRC system can help businesses better assess financial risks and efficiently implement compliance requirements. AI-powered analytics tools can assist in forecasting future economic developments and making strategic decisions based on solid data.

4. Technological Innovations and Artificial Intelligence

Artificial intelligence is transforming business models and introducing new risks. From automated decision-making to ethical concerns regarding AI usage, companies must ensure compliance with legal requirements and ethical standards.

GRC Solution: A modern GRC software solution can help monitor AI applications and ensure compliance with all regulatory and ethical standards. Automated compliance checks and audits can relieve businesses of administrative burdens and minimize risks.

5. Regulatory Changes and Stricter Compliance Requirements

Regulatory authorities worldwide are tightening requirements for businesses. Data protection laws such as the GDPR, new ESG guidelines, and industry-specific compliance regulations present companies with major challenges.

GRC Solution: A central GRC platform allows businesses to efficiently manage regulatory requirements and continuously monitor compliance. Automated processes help minimize compliance risks and avoid penalties.

Conclusion: GRC as a Key Competitive Advantage

In a world full of uncertainties, GRC is no longer just a nice-to-have but a mission-critical function. Companies that strategically leverage GRC are better prepared for crises, minimize risks, and can adapt more quickly to changing market conditions. A powerful GRC software solution is the key to effective and agile risk management.

Businesses that invest in their GRC strategy now will not only secure compliance and risk transparency but also gain a significant competitive advantage in an ever-changing global economy.

The rapid integration of Artificial Intelligence (AI) in the financial sector presents both opportunities and challenges. With the publication of Supervisory Notice 08/2024, FINMA has outlined clear expectations for governance and risk management in relation to AI usage.

Key Points of FINMA Supervisory Notice 08/2024

FINMA emphasizes that although there is no specific AI legislation in Switzerland, existing, technology-neutral regulatory requirements also apply to AI. Financial institutions must actively analyze the impact of AI on their risk profile and adapt their governance, risk management, and control systems accordingly.

Key risks identified include operational risks such as model uncertainties, IT and cyber threats, and increased dependence on third-party providers. FINMA requires institutions to define clear responsibilities, maintain a comprehensive inventory of AI applications, conduct regular testing to ensure data quality and model stability, and implement independent reviews of critical AI systems.

The Impact of Increasing AI Usage on GRC

The growing implementation of AI is significantly transforming Governance, Risk Management, and Compliance (GRC):

• Governance: AI adoption necessitates adjustments in corporate governance, including the clear assignment of responsibilities for AI development, implementation, and oversight.
• Risk Management: AI can help identify and mitigate risks by analyzing large datasets and detecting patterns. However, new risks arise, such as faulty algorithms or biased data, which require continuous monitoring.
• Compliance: AI usage must align with existing regulatory requirements, ensuring transparency in AI-driven decisions and protecting sensitive data.

How GRC Software Can Help

Modern GRC software solutions play a crucial role in addressing AI-related challenges:

• Automation and Efficiency: AI-powered GRC tools can automate processes, increasing efficiency and accuracy in risk and compliance management.
• Real-Time Monitoring: AI-driven GRC systems enable continuous risk and compliance monitoring, allowing companies to proactively address potential issues.
• Integration and Scalability: GRC software integrates seamlessly into existing IT infrastructures and scales to meet the growing demands of AI implementation.

Conclusion

FINMA’s Supervisory Notice 08/2024 highlights the need for robust governance and risk management frameworks in response to AI adoption in the financial sector. As AI continues to shape GRC structures, organizations must adapt their strategies and tools. GRC software solutions provide essential support by automating processes, enabling real-time monitoring, and ensuring seamless integration into existing systems.

Successful companies set clear corporate goals to achieve growth, efficiency, and competitive advantages. However, these goals are often associated with risks that can negatively impact business success. Effective risk management is therefore essential to identify threats early, take appropriate measures, and ensure the achievement of corporate goals.

Risks as an Integral Part of Corporate Strategy

Every strategic decision carries risks. These can be financial, operational, regulatory, or technological in nature. If risks are not identified early and aligned with corporate goals, they can lead to significant losses. A proactive approach helps minimize uncertainties and maximize opportunities.

The Connection Between Corporate Goals and Risks

1. Identifying Relevant Risks

Companies should systematically identify risks related to their strategic, operational, and financial goals. For example, expanding into new markets can involve currency risks, regulatory uncertainties, and logistical challenges.

2. Risk Assessment and Prioritization

Not all risks have the same impact on corporate goals. Therefore, prioritization is crucial. Companies can use methods such as risk matrices or Monte Carlo simulations to assess probability and potential damage.

3. Developing Risk Management Measures

Once risks are identified and prioritized, measures to manage them must be developed. These may include risk avoidance, mitigation, transfer, or acceptance. For instance, companies can minimize certain risks through insurance or contractual agreements.

4. Continuous Monitoring and Adjustment

Dynamic risk management requires continuous monitoring and adaptation to new developments. Companies should regularly review whether existing measures are still effective or need optimization.

How GRC Tools Simplify Risk Management

Governance, Risk, and Compliance (GRC) tools help companies efficiently manage their risks and align them with corporate goals. These tools provide a centralized platform for identifying, analyzing, and controlling risks while facilitating documentation and reporting. The benefits of a GRC tool include:

• Automated Risk Assessments: Reduction of manual errors and faster identification of critical risks.
• Integration with Corporate Goals: Clear linkage between strategic goals and potential risks.
• Real-Time Monitoring: Continuous monitoring and alerts for deviations.
• Efficient Reporting: Simplified reporting for decision-makers and auditors.

Conclusion

Linking corporate goals with risk management is crucial for long-term success. A structured approach enables targeted risk control and ensures the achievement of corporate objectives. Modern GRC tools significantly simplify this process, allowing companies to monitor risks in real-time and make informed decisions. Proactive risk management is not just protection against threats but also a competitive advantage.