2025 Executive orders to watch in 2026
The first year of President Donald Trump’s second term proved to be a busy one. The White House issued Executive Orders (EOs) on a wide range of topics, including employment, energy and natural resources, government contracting, federal regulatory oversight, and artificial intelligence (AI). A number of these EOs were challenged in court. Some of those challenges remain active, but others have been at least partially resolved.
Now that the flurry of EOs has slowed somewhat, business leaders can get a better sense of how to comply with this new federal guidance. The following are six areas in which the Trump administration focused its attention in 2025—and that companies can expect to remain priorities in 2026.
Diversity, equity, and inclusion
One of the Trump administration’s first EOs, issued in January 2025, sought to end what it calls “illegal” diversity, equity, and inclusion (DEI) and diversity, equity, inclusion, and accessibility (DEIA) programs.
Federal agencies have attempted to implement the EOs through directives and guidance. Hundreds of legal challenges have been filed, and more are likely, with plaintiffs (and critics) noting the lack of clear definitions for “illegal DEI” within existing law, EOs, directives, and guidance. This has created significant uncertainty for government contractors and subcontractors, grantees, and private employers.
As 2025 progressed, the Department of Justice created the Civil Rights Fraud Initiative (CRFI) to target “unlawful” DEI using the False Claims Act (FCA) to investigate and pursue claims against recipients of federal funds that knowingly violate federal civil rights laws by, among other things, promoting what it called “divisive DEI policies.” The Equal Employment Opportunity Commission (EEOC) has intensified its focus on “DEI-related discrimination” and “anti-American employment bias” by actively seeking potential claimants through social media postings.
In an interesting turn of events, on January 21, 2026, the Trump administration agreed to dismiss its appeal of an August 14, 2025, ruling prohibiting it from enforcing a February 14, 2025, letter that declared certain DEI practices at schools “impermissible” and required schools to certify their “compliance” with the administration’s interpretation of Title VI of the Civil Rights Act of 1964 as a condition of continuing to receive federal financial assistance.
Government contracts
On January 7, 2026, President Trump issued an EO titled “Prioritizing the Warfighter in Defense Contracting.” The EO states, “Many large contractors—while underperforming on existing contracts—pursue newer, more lucrative contracts, stock buy-backs, and excessive dividends to shareholders at the cost of production capacity, innovation, and on-time delivery.”
To address this stated problem, the EO requires the Secretary of Defense to identify defense contractors for “critical weapons, supplies, and equipment” that are also deemed to be “underperforming on their contracts, not investing their own capital into necessary production capacity, not sufficiently prioritizing United States Government contracts, or whose production speed is insufficient as determined by the Secretary, and that have, during the period of [the existence of any of these issues] engaged in any stock buy-back or corporate distribution.” Once the secretary has identified these contractors, he then is required to provide them with notice describing the nature of the underperformance or insufficient prioritization, investment, or production speed and is required to engage with them to resolve the issues identified. This engagement includes “providing the contractor with the opportunity to submit a remediation plan approved by its board of directors for review by the Secretary, during the 15-day period following notification.”
Significantly, if a remediation plan is deemed insufficient, the EO contains enforcement provisions allowing the secretary to initiate “immediate actions to secure remedies . . . that will expedite production, prioritize the United States military, and return the contractor to sufficient performance, investment, prioritization, and production, to the maximum extent permitted by law.” Independent of these enforcement provisions, the EO also requires the secretary to “take steps to ensure that any future contract with any new or existing defense contractor, including any renewal, contains a provision prohibiting both any stock buy-back and corporate distributions by the contractor during a period of underperformance, non-compliance with the contractor’s contract, insufficient prioritization of the contract, insufficient investment, or insufficient production speed as determined by the Secretary.” It further includes restrictions on executive compensation for defense contractors.
This EO represents a significant shift in how the government works with its contractors and leaves open questions on how the secretary will determine which contractors have the identified problems with contract performance. It extends the department beyond its traditional oversight role related to contract performance by requiring the secretary to monitor how defense contractors pay dividends, engage in stock buybacks, and pay their executives. Defense contractors should closely review and prepare for compliance with this EO and should also keep watch for any litigation involving it.
An April 2025 EO also made significant changes for government contractors by mandating substantial reforms to the Federal Acquisition Regulation (FAR) and related agency supplements to streamline federal procurement, which is referenced as the Revolutionary FAR Overhaul (RFO). The RFO order requires the FAR to include only provisions mandated by statute or essential for sound procurement, aiming to reduce regulatory complexity and inefficiencies.
Since the issuance of the RFO order, the FAR Council has issued model deviations to the various FAR parts, which can be found on the RFO website. Various federal agencies have also proceeded to implement class deviations to their own regulations, which effectively adopt the model deviations before the process of public comments and formal rulemaking is completed. This quick adoption will likely lead to disputes in the protest setting about whether the new RFO rules or the pre-RFO rules apply to a particular procurement. While the goal of these changes is simplification, government contractors should stay aware of potential conflicts between the old and new rules to determine how they might affect their contracts.
With the quickly changing landscape in the underlying regulatory scheme, government contractors must stay aware of these changes and potential enforcement related to them as 2026 unfolds. Expect increased activity around alleged fraud, waste, and abuse. Contractors should be ready to respond to a federal investigation at any time.
Artificial intelligence
President Trump ended 2025 with two EOs that, together, establish a sweeping federal AI strategy prioritizing national control over state regulation. While the Genesis Mission EO focuses on mobilizing federal resources for AI development, the AI Framework EO aggressively asserts federal preemption of state AI laws through litigation, funding restrictions, and new federal standards, framing AI leadership as vital to national security and economic competitiveness.
Key provisions of the orders include creating a Department of Justice (DOJ) AI Litigation Task Force within 30 days, a Commerce Department evaluation of state laws within 90 days, financial penalties for noncompliant states, and Federal Communications Commission (FCC) and Federal Trade Commission (FTC) actions to set national standards and preempt conflicting state requirements.
These orders create immediate compliance uncertainty for companies, raise constitutional and First Amendment issues, and signal significant opportunities for public-private partnerships under the Genesis Mission initiative.
Green/renewable energy
The Trump administration’s recent actions have created a significant amount of uncertainty in the renewable energy sector by dismantling key federal programs and incentives. For example, the cancellation of the Solar for All grant program—originally allocating $7 billion to expand solar access for low-income households—removes a major funding source for distributed solar projects.
This action stems from the One Big Beautiful Bill Act, which eliminated the Greenhouse Gas Reduction Fund and restricted tax credits that previously supported solar development. Additionally, the Interior Department’s new policy prioritizing nuclear, gas, and coal projects over wind and solar on federal lands further limits opportunities for large-scale renewable projects.
Combined with the Environmental Protection Agency’s (EPA) proposed reversal of the Endangerment Finding and the Department of Energy’s (DOE) review of $15 billion in clean energy grants, these moves create uncertainty for renewable energy companies and signal a broad federal retreat from renewable energy investment.
Federal agency independence
The Independent Agency EO, signed by President Trump on February 18, 2025, marked a major shift in federal regulatory oversight by attempting to extend White House control over independent agencies such as the FCC, the FTC, the Securities and Exchange Commission (SEC), and the Federal Energy Regulatory Commission (FERC). For the first time, these agencies would be required, if the EO is followed, to submit all “significant regulatory actions” to the Office of Management and Budget’s (OMB) Office of Information and Regulatory Affairs (OIRA) for review and approval before publication, a process previously reserved for cabinet-level departments.
Coupled with the Deregulation EO signed the following day, which requires agencies to identify and review regulations inconsistent with the administration’s policy objectives, these actions represent an aggressive push to limit the so-called “administrative state.” These changes are expected to slow rulemaking and create uncertainty for businesses, while also offering regulated entities an additional opportunity to influence or block agency actions through OIRA’s review process.
These changes also foreshadowed other legal challenges to agency independence over the course of the year, particularly around the president’s asserted authority to remove independent agency heads and commission or board members at will, as well as their associated firings. Several of these firings are being tested in federal court, including two major cases in front of the Supreme Court.
One of those cases involves President Trump’s March 2025 firing of FTC Commissioner Rebecca Kelly Slaughter, which was initially enjoined by the district court as not based on Slaughter’s “inefficiency, neglect of duty, or malfeasance in office,” as required by the FTC Act. At oral argument, a majority of the Justices appeared sympathetic to the administration’s position that the statutory removal restrictions impermissibly encroached on the president’s executive authority under Article II of the Constitution. In contrast, President Trump’s August 2025 firing of Federal Reserve Governor Lisa Cook—also enjoined by the district court as not “for cause” as required by the Federal Reserve Act—faced a far more skeptical Supreme Court at oral argument, with many commentators predicting Cook’s firing would be rejected by the Court.
It will be interesting to see, if the cases come down as some predict, how the Supreme Court will distinguish sustaining the firing, without cause, of an FTC commissioner (which will result in reversal of Court precedent that dates back to 1935) from reversal of the firing of a Federal Reserve Board Governor likewise without cause, both of whom are members of independent agencies. Maybe the distinction is a well-articulated and understood basis for protecting from political influence the independence of the Fed, particularly around interest rates and monetary policy, compared to other independent agencies that perhaps lack a similar compelling or articulated basis for their independence. If so, this might suggest that, at the end of this Supreme Court term, some independent agencies may, in fact, end up more independent than others. The Supreme Court is expected to decide both cases this summer.
Trade and tariffs
The Trump administration has asserted broad authority under the International Emergency Economic Powers Act (IEEPA) to impose tariffs. Currently, the U.S. Supreme Court is reviewing President Trump’s use of IEEPA. This case has become a major test of how far emergency powers can substitute for Congress’s traditional authority over trade and taxation. At issue are two tariff programs—drug‑trafficking‑related duties and so‑called reciprocal tariffs—both struck down by lower courts on the grounds that IEEPA does not clearly authorize the president to impose revenue‑raising duties.
The case turns on whether “regulating importation” can reasonably include tariffs, whether such a consequential delegation requires unmistakable congressional intent, and what limiting principles could prevent emergencies from becoming a catch‑all tariff justification. Several possible Supreme Court outcomes could reshape market conditions, administrative strategy, and the speed with which future presidents deploy trade measures.
Refunds for more than $130 billion in already‑collected duties present enormous practical complications, requiring importers to maintain meticulous records, protect procedural rights, and resolve contractual questions about who ultimately bore the cost. The ruling is poised to reset the balance of trade authority between Congress and the executive and will reward firms that treat the aftermath as a documentation‑driven race to recover eligible payments.
For businesses, these orders introduce both risk and opportunity. Regulatory processes will likely slow and become more politicized, but companies may gain new avenues to challenge unfavorable rules through OIRA and increased engagement with the Executive Branch.
Looking ahead
As businesses look ahead to 2026, it’s clear the Trump administration’s EOs will continue to shape the regulatory and operational landscape in profound ways. Companies should prepare for a year marked by increased enforcement, evolving compliance obligations, and the need for proactive advocacy to protect their interests in an environment where executive action remains a dominant force.
This article was written by Womble Bond Dickinson (US) LLP attorneys Martha Zackin, Beth Jones, Zachary Buckheit, Lynn O’Brien, Joshua Mullen, Tara Cho, Robert Broadbent, Kristina Moore, Noah Zedek, James Kearney, Marty Stern, Gracie Kreth, Scott Jones, Alan Enslen, and Dan Joyner. They can be reached at 336-721-3600 or info@wbd-us.com.
