Compliance rules stunting growth for Irish companies, says study

PwC Global Compliance Survey says 97% of Irish firms surveyed believe regulations have become more complex 

Complex regulations governing compliance are stunting Irish business, and stalling AI adoption, according to the latest PwC Global Compliance Survey.

Complex regulations governing compliance are stunting Irish business, and stalling AI adoption, according to the latest PwC Global Compliance Survey.

Nearly three-quarters (73%) of Irish respondents to the global survey said that the increasing complexity of compliance requirements is stunting key areas of their business, such as profitability, market expansion, launching new products and services, adoption of AI, and resource capacity.

Compliance covers a company’s responsibility for legal, regulatory, and internal policy obligations, and covers areas such as General Data Protection Regulation.

The global survey gathered the views of 1,802 executives across 63 territories, including 32 respondents in Ireland.

It found that 97% of the Irish companies surveyed believe regulations have become more complex in the last three years, and 85% feel they are more onerous than global counterparts.

Just 12% of Irish respondents said that they are either piloting or already using AI across a wide range of business areas, such as using AI in predictive analytics, fraud detection, and investigations.

While Irish companies say compliance is affecting business, 88% of Irish firms have concerns about data privacy and misinformation when it comes to adopting AI in compliance activities.

Despite this, over half (59%) of Irish respondents believe that AI will have a net positive impact on compliance.

PwC risk and regulation partner Julie Kennedy said: “As regulatory pressures intensify and technology re-shapes compliance, Irish businesses must act decisively to close the gap with global leaders. 

"By embracing cutting-edge technology, nurturing diverse talent, and adopting a strategic mindset, firms can transform compliance from a cost centre into a value driver.

“In the current economic environment of disruption and uncertainty, having a best-in-class compliance function that ensures the business adheres with all applicable regulations, preventing financial loss, and guarding the firm’s reputation, is more important than ever.

“Those who successfully reimagine their compliance functions as strategic assets will gain a competitive edge in an increasingly complex business environment.”

The complexity of data across the organisation (63%) and a lack of technology tools (50%) are key challenges holding up the use of data to support compliance activities in Ireland. Less than a quarter (23%) of Irish respondents said that they are planning to invest more in technology to optimise compliance activities.

In Ireland, specialist knowledge was seen as a critical skill to maintain effective compliance by 81% of business respondents, compared with just 53% globally.

Some 59% of Irish businesses saw communication/collaboration and critical thinking/professional scepticism as critical skills, compared to 42% globally.

The report said: “This emphasis on specialisation and communication/critical thinking may influence future talent acquisition and development strategies in the compliance field, especially in Ireland.”