Staying Afloat in an Ocean of Financial Regulations and Challenges
A fast-paced and globalised world means change is constant. The accounting and finance industry makes no exception with changing regulations, novel cross-border requirements and a heightened scrutiny from investors and regulators alike. As highlighted by Catherine Shimsky, Vice President, ERC advisory, policy and learning, at Novartis at a recent PCC webinar, maintaining stability and embracing transformation is a key challenge for compliance professionals in 2026. The traditional accounting model is also experiencing capacity constraints. Growing client portfolios and keeping headcount low do not go hand in hand, prompting financial leaders to think creatively to navigate scalability, succession and talent pressures. As in many other industries, AI seems to be the answer to these challenges – however, its use introduces unique risks in this highly regulated sphere.
This article by the Accounting and Reporting Financial Summit Europe 2026 team explores regulatory pressures; the integration of AI technology; and the growth of ESG reporting challenges.
Regulatory and Pricing Pressures
Changes in financial and accounting regulations play a significant role in financial operations, with 77% of firms predicting tax laws to impact their workflows. Geopolitical factors like tariffs also contributes to an ever-changing landscape while exacerbating already existing challenges such as regulatory fragmentation and lack of harmonisation across jurisdictions.
Electronic invoicing is a big point of discussion in Europe as it is set to progressively become mandatory, especially for domestic transactions. Some governments such as France, Germany and Spain are implementing phased rollouts. E-invoicing legislation from governments is set to increase European business competitiveness – by making collaboration between business and public sector more accessible and promoting e-invoicing in B2B transactions. Technology-wise, digitalisation enables the automation of previously disjointed business processes as well as the adoption of new technologies such as AI and machine learning integration.
On the other side of the pond, Most Favoured Nation pricing - a policy seeking to link US drug prices to those in other developed countries - may affect pricing frameworks in ex-US (excluding the United States) licensing agreements. With this new policy, ex-US pricing actions can have a direct impact on US net prices and revenues, marking a turning point in global pricing balance. A heavy discount in a European market may end up lowering the price of the same drug in the USA which could inflate or reduce ex-US prices to accommodate. Therefore, the coordination and timing of launches, price revisions and contract renegotiations are now a global affair that needs to be carefully orchestrated. MFN has introduced a new dynamic in global pricing and pricing governance must respond accordingly to minimise risk.
In addition, companies must evaluate the financial and operational impact of tariffs and onshoring commitments on their global supply chains. With high tariffs imposed and a volatile stock market, companies must monitor if any of the asset impairment indicators exist and account for any losses. Significant effort will also be required in evaluating for how long and to what extent future cash flow will be affected by tariffs in different circumstances. While disclosure requirements under IFRS for interim financial reporting are less comprehensive than for annual financial reporting, companies are required to explain significant events that affect their financial position. This means where tariffs have caused impairments, these will have to be disclosed in a comprehensive manner. With evolving regulations and legislation, it is crucial for companies to monitor when changes are announced and consider if these need to result in amendments to measurements or disclosures.
The above regulatory and pricing pressures make for a tricky landscape to navigate and keep up with. At the Life Sciences Accounting and Reporting Europe Town Hall (Day 1, 17 November) finance leaders will come together to engage in an open, audience-driven dialogue on the evolving regulatory landscape across both USA and Europe. Join the conversation and ask your questions directly to a panel of experienced finance leaders.
Integration of AI Technology in Reporting: A Two-Pronged View
According to KPMG data, 71% of companies globally are using AI in finance and data from the 2025 Future Ready Accountant report showed that the percentage of European companies implementing AI tools has jumped from 8% to 42%. BioXconomy highlights AI as a “powerful tool for compliance and a significant source of risk”. With less students choosing accounting degrees and rising need for accounting professionals, more and more companies are deploying AI across a multitude of activities from forecasting and analysing data to drafting regulatory submissions. Automation and AI-driven reconciliation systems have helped some firms reduce month-end closes from ten to two days. Experimenting with "self-healing" data pipelines that correct anomalies in near-real time is also on the table with some companies already trying it out. Even more, development of LLMs has made conversational accounting a reality, with leaders and investors alike being able to ask questions and receive answers in plain language by their finance system. This is prompting a new generation of accountants who are more of strategic business advisors, a bridge between the raw data and the boardroom and whose skills are adapted to new technology such as prompt engineering.
In a recent webinar covered by BioXconomy, Elizabeth Hardcastle, partner at Sidley Austin, shared three core principles when it comes to AI integration: having a human in the loop to review and sign off AI-generated work; implementing comprehensive AI governance policies; and maintaining adequate documentation to support decision-making related to AI. In addition, EU regulators continue to tighten scrutiny around AI decision-making with strict obligations around transparency, retention and data security.
In the panel discussion, AI in FP&A: From Hype to Practical Impact, Nikolai Simeonov, Strategic Projects FP&A Manager at Zentiva, will focus on where AI is delivering tangible value today, including its application across forecasting, planning, variance analysis and reporting processes. We will also evaluate the risks, controls and governance frameworks required to support responsible, compliant and scalable AI adoption within FP&A functions.
ESG and Reporting Challenges in Accounting and Finance
The accounting industry has experienced a significant shift towards a more rigorous ESG reporting that has led to organisational and data management challenges. The Corporate Sustainability Reporting Directive (CSRD) calls for broader reporting of environmental, social and governance (ESG) issues. This means that ESG data is now scrutinised just as much as financial data, making it a compliance and financial reporting function that requires attention and resource.
One of the risks mandatory ESG reporting poses is a disconnect between sustainability teams, not necessarily experienced in finance and finance teams. Additionally, accurate and thorough data capture and data management across complex organisations is another challenge to be solved, with manufacturing and supply chain operations further complicating data reporting. Companies must also align to different frameworks such as the GHG Protocol, ISSB standards and CSRD, which add another layer of complexity for multinational firms that operate in jurisdictions with differing requirements. The rise of the ESG controller as a key role in financial organisations can help close the gap between financial accuracy and traditional sustainability reporting. ESG controllers can apply rigorous control frameworks, borrowed from financial reporting, to identify and resolve data pipelines issues sooner.
Recently, the European Commission has revised the European Sustainability Reporting Standards (ESRS) to reduce administrative burdens for EU businesses while ensuring high-quality reporting on issues such as climate change, biodiversity and human rights. Some of the changes include reduction of mandatory data points by 60% as well as added flexibility and more streamlined processes. These changes are expected to reduce reporting costs by more than 30% per company - a very important goal as ESRS is a voluntary reporting standard for smaller companies outside the scope of CSRD. This standard, however, makes it easier for smaller companies to respond to requests for sustainability information from large financial institutions and establishes a value chain cap.
At Life Sciences Accounting and Reporting Summit Europe 2026, in the company of Laura Gittard, VP, Global Finance Risk Management & Controls and ESG Reporting at GSK, we will assess how organisations are integrating ESG considerations into their financial reporting and accounting frameworks. Attendees will leave with a better understanding of integrating ESG and CSRD/ESRS requirements, strengthening finance risk and controls and implementing governance, data and assurance considerations as stakeholders demand more decision-useful, comparable sustainability information.
In 2026, we are bringing the Life Sciences Accounting and Reporting Summit to the financial capital of Europe, London. Join us at this premier European forum where top pharma and biotech finance leaders gather to address industry-specific accounting challenges and transform them into competitive advantages. Leave with a better understanding of what lies ahead and with new connections in the finance and accounting world thanks to our dedicated networking opportunities.
“This event offers deep sector-specific content, case studies and peer debate that recognise the unique characteristics of pharma and biotech – from R&D and product portfolios to collaboration models and ESG issues – making the insights immediately applicable for finance and reporting teams working in life sciences today.” – Laura Gittard, VP, Global Finance Risk Management & Controls and ESG Reporting at GSK