This O’Melveny Public Company Advisory Group publication reports on the results of the firm’s review of risk factor disclosures from large companies’ latest Form 10-Ks to identify common trends in reported risks across industries. Not surprisingly, risks related to AI, tariffs and the change in the presidential administration were trending up, while pandemic risk factors were trending down, and DEI risk disclosures were evolving. Here’s more info:

Artificial Intelligence. AI risks were mentioned in 86% of all Forms 10-K filed by large companies in 2025. Many large companies included a “standalone AI risk factor” that consolidated AI-related risks. AI was also referenced in these 10 other risk factors:

– Cyber threat – Actors using AI to commit cyber crimes
– Human Capital – Retaining a sufficiently skilled workforce
– Regulatory – Complying with expanding governmental oversight of AI
– Competitive – Keeping pace with technological advancements of competitors
– Use & Misuse – Misuse of AI by employees, contractors, and bad actors
– Execution – Launching new tools without vulnerabilities, bugs, or defects
– Strategic – Responding to rapid changes in technology and customer preferences
– IP – AI use leading to infringement claims by or against the company
– R&D – Recovering investments in new technologies
– Reputation – Bad publicity or liability arising from company’s use of AI

Tariffs. Tariff risks were mentioned in the Risk Factors section of 85% of all Forms 10-K filed by large companies in 2025. Those risk factors addressed:

– Tariffs and trade policies impacting availability and pricing for commodities and raw materials
– Tariffs as a factor contributing to volatility in the political and economic environment
– Tariffs and other trade restrictions causing supply chain interruptions
– Tariffs causing fluctuations in customer demand, making forecasting difficult
– Tariffs causing reduction in consumer spending

Presidential Administration Change. 15% of all Forms 10-K filed by large companies in 2025 discussed risks related to the change in presidential administration. In addition to tariffs, those included:

– Risks to the company (including FCA liability) if their sustainability or other practices are deemed to be in contradiction to the Trump Administration’s “anti-ESG” policies
– Impact of the Administration’s efforts to reduce the federal workforce, in particular for companies that require federal agency approvals
– Impact of the Trump Administration’s efforts to roll back government spending, in particular for companies that rely on government contracts and subsidies

DEI. The percentage of large companies including references to DEI in risk factors declined from 2024, even while 7% of large companies added a new risk factor mentioning DEI. Where maintained or added, the risk factors often addressed the difficulty of balancing competing pressures from investors, regulators, consumers and the federal government.

– Meredith Ervine