Introduction:
As of February 2026, European corporate strategy is dominated by the need to navigate a “make-or-break” year for economic reform, defined by intense geopolitical pressures, a push for industrial autonomy, and, for the first time, solar and wind power exceeding coal and gas in the EU. Key strategic issues revolve around responding to an impending “Made in Europe” industrial policy, managing high energy costs, and adapting to a more fragmented global trade environment. On the other hand, the United States is defined by intense navigation of economic uncertainty, rapid AI integration, and a volatile geopolitical landscape. US CEOs are shifting away from traditional recession worries toward managing high-stakes, long-term structural changes, with 60% prioritizing business model transformation to secure future profitability.
United States
February 2026
- Corporate Bankruptcies Hit 15-Year High
2025 Surge: Over 700 companies filed for Chapter 7 or 11 bankruptcy protection by December 2025.
Key Sectors Affected: Retailers, restaurants, and industrial firms are heavily impacted.
High-Risk Outlook: The CreditRiskMonitor FRISK® stress index in 2026 remains above average, indicating sustained, elevated risk of insolvency. Businesses are actively pivoting from growth-focused strategies to defensive maneuvers, including aggressive cost-cutting, restructuring, and the use of liability management transactions (LMTs) to avoid full liquidation.
Contributing Factors: The AllSides report highlights that persistent inflation and high debt burdens continue to squeeze company balance sheets. Manufacturers have been hit hard by high input costs and supply chain disruptions due to tariff policies.
Trend Continuation: Business insolvencies are expected to remain above pre-pandemic levels, with potential improvement only appearing in the latter half of 2026 as rate cuts take effect, says Coface.
While the 700+ figure specifically refers to large corporate filings in 2025, overall bankruptcy filings (including personal) rose 11% in the year ending December 2025, according to the United States Courts.
- The U.S.-Mexico – Canada Agreement (USMCA)
The statutory review of the U.S.-Mexico-Canada Agreement (USMCA) in 2026 is creating investment uncertainty and focusing on supply chain security. The USMCA is critical for the U.S., Canadian, and Mexican economies and failure to renew it would have significant implications. Trilateral trade (goods and services) reached over $1.9 trillion in 2024; the USMCA market covers 30% of global GDP.[1] Failure to renew the USMCA agreement would remove Canada and Mexico’s protections against U.S. tariffs. Governments are supposed to submit their recommended changes to the Free Trade Commission by June 1st. There are several issues that the U.S., Canada and Mexico will bring on the table of the negotiations. Ahead of the July 1, 2026, joint review, the U.S., Canada, and Mexico are preparing to negotiate reforms focusing on strengthening labor, environmental, and digital trade obligations, alongside addressing disputes over rules of origin, Mexican energy policies, and dairy market access. The negotiations aim to tackle Section 232 tariffs on steel/aluminum and ensure supply chain security.
Key Reform Areas for 2026 Negotiations are:
- Rules of Origin (Auto Industry): The U.S. is pushing for stricter interpretations of automotive rules of origin to maximize regional content, while manufacturers navigate complex, tighter standards for vehicles and components.
- Energy and Regulatory Disputes: Continued focus on resolving U.S. and Canadian challenges against Mexico’s energy policies that favor state-owned firms, which are seen as violating USMCA’s market-opening commitments.
- Labor and Environmental Standards: Strengthening the enforcement of labor obligations, particularly regarding collective bargaining rights, and tightening environmental commitments.
- Digital Trade and Data: Refining provisions to ensure free flow of data, protecting source code and algorithms, and ensuring fair treatment of digital services.
- Dispute Settlement Mechanisms: Addressing the effectiveness of the rapid response labor mechanism and general dispute resolution.
- Dairy Market Access: Addressing Canadian dairy tariff-rate quotas, a long-standing issue for the U.S..
- Supply Chain & Security: Integrating strategies for critical minerals and strengthening North American supply chains to compete with China, particularly in manufacturing.
EUROPE
February 2026
- “Made in Europe” Strategy and Protectionism: Over 1,100 CEOs and the European Commission are pushing for a “Made in Europe” strategy to prioritize local products in strategic sectors, responding to cheaper imports and tightening competition. This forces companies to reconsider supply chain security, with some favoring the shift, while others—particularly in the automotive sector—fear inflationary effects and the dismantling of globalized, efficient, but vulnerable supply chains.
- Geoeconomic Re-calibration and De-risking: With Germany developing a “China Action Plan” for February 2026, European firms are under pressure to de-risk from China, particularly regarding rare earths and critical technologies. Companies are shifting from a passive, cost-focused model to a proactive, security-focused strategy that anticipates further restrictions on trade with China and Russia.
- Energy Cost Disparities and Sustainability: European industries continue to face energy costs two to three times higher than in the US and China. Corporate strategy must now balance the urgent need for competitive energy prices with the accelerating “Clean Industrial Deal,” forcing firms to accelerate decarbonization despite economic pressures.
- AI Integration and Regulatory Compliance: The focus has moved from AI adoption to embedding AI into core business strategies, moving beyond IT to redesign workflows, while simultaneously complying with the strict, newly enforced, and increasingly audited EU AI Act.
- Regulatory Tightening and Deepening Integration: Companies are navigating a massive shift toward “2026 implementation” of previously agreed laws, including the Digital Services Act (DSA), Digital Operational Resilience Act (DORA), and intensified, more centralized EU antitrust enforcement following the Draghi report.
- Financial & Operational Resilience: With inflation stabilizing near 2% and recession fears easing, the focus for finance leaders has shifted toward managing volatility and structural change rather than immediate crisis management.
- Omnibus Package: Launched in February 2025, the European Commission‘s Simplification Omnibus Package (I & II) aims to reduce regulatory burdens by 25% for businesses and 35% for SMEs. It focuses on streamlining sustainability reporting (CSRD), due diligence (CSDDD), and Carbon Border Adjustment Mechanism (CBAM) rules, with key changes including delaying CSDDD application to 2028 and easing, while maintaining, green transition requirements.
[1] https://www.policymagazine.ca/letter-from-washington-the-outlook-for-usmca-cusma-on-the-road-to-july/
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