Geopolitical Shocks And AI Risks Push GRC Software Market Towards $11 Billion As Legacy Risk Tools Struggle To Keep Pace

London, UK. New research from Verdantix forecasts that the global governance, risk and compliance (GRC) software market will grow from $6.5 billion in 2025 to $10.9 billion by 2031, as organizations respond to escalating geopolitical instability, expanding AI governance requirements and increasingly fragmented regulation.

The Verdantix Market Size And Forecast: Governance, Risk & Compliance Software 2025-2031 (Global) report finds that GRC software is evolving from a compliance-focused application to a strategic operational platform. Firms are moving away from siloed risk tools towards unified platforms capable of continuously monitoring risks, automating evidence collection and supporting AI governance across increasingly complex operations.

North America currently represents the largest regional market, and the region’s GRC software spending is forecast to reach $4.9 billion by 2031. Growth is being fuelled by expanding US state privacy regulations, increasing third-party and AI governance obligations, and expectations of broader federal AI governance requirements.

The research identifies business services as the fastest-growing industry, largely due to the EU AI Act, which from August 2026 will require professional services firms operating within the EU to maintain inventories of AI systems and demonstrate effective human oversight during audits.

Beyond regulation, organizations are responding to heightened operational risk, such as the Strait of Hormuz closure, sanctions misalignment and an increasing number of state-sponsored cyber attacks. Recent geopolitical upheaval has exposed vulnerabilities across global supply chains, while the rapid adoption of AI is creating new governance challenges. IBM estimates that unmanaged AI usage increases the average cost of a data breach by approximately $200,000, reinforcing the need for greater visibility into AI deployment and data flows across enterprise ecosystems.

"The pace of geopolitical disruption, AI adoption and regulatory change is expanding compliance workloads faster than legacy GRC tools can keep up. Enterprises are no longer buying GRC software simply to satisfy auditors, but to provide continuous, integrated visibility of risk across their operations," said Tom Murphy, Analyst at Verdantix. "Buyers are increasingly selecting unified GRC platforms in which AI-driven monitoring and automated evidence workflows are the primary differentiators. Vendors that cannot deliver these capabilities at mid-market price points risk losing competitiveness as demand accelerates over the next few years."

The findings also reflect changing buyer priorities. Verdantix research shows that 78% of risk managers rank improvements in real-time data collection and reporting as either their top or a high priority, indicating a broader shift from periodic compliance reporting to continuous risk intelligence and evidence-based governance.

The full report, Market Size And Forecast: Governance, Risk & Compliance Software 2025-2031 (Global), is now available.

About Verdantix
Verdantix is an independent research and advisory firm that serves a global client base consisting of the world’s most innovative corporations, services vendors and investors. Our insights and analysis form a foundation of the most granular data available in the marketplaces we serve. This allows us to make highly accurate far-reaching forecasts and big-picture predictions that business leaders depend on when they are setting out to reach their most important goals.