Goldman Sachs, meanwhile, which in February disclosed that its Russian exposure was $650 million, said it had suffered a net loss of about $300 million on investments in Russia and Ukraine. Thank you! Please try again later! You may share a link to this page on any of the sites listed below. According to the report, no single locale is likely to dominate all regions or domains, and a broader range of actors will compete to advance their ideologies, goals, and interests.. The businesss board can apply a materiality test to pinpoint what it should dedicate time to discussing. Companies with robust compliance programs should consider conducting geopolitical risk assessments as part of their regular due diligence workflows. Please try again later. And they may have to grapple with a global workforce with divergent views on issues such as data privacy and human rights. Understand counterparty risk with forward-looking analysis of reputational, legal and political risks associated with new or existing partners, Risk Quantification Economic and Geopolitical scenarios Reuters, The EY survey last year on bank risk management, Monitoring for Reg BI poses bigger challenge as US regulators get serious, Weighing the various approaches to Scope 3 data strategies, 10 Global compliance concerns for 2023: ESG, money-laundering, and regulatory concerns weigh on compliance officers, From values signaling to implementation: Steps for corporate tax leaders to prepare for ESG, Thomson Reuters Institute launches Technology and Innovation Resource Center, Small law firms finding success & challenges in uncertain economy, says new report, Innovation Lesley is a seasoned board member and executive with over 25 years of proven expertise in strategic planning, risk management, governance, partnership development, and stakeholder relations in complex situations. Complying with anti-money laundering and anti-bribery and corruption regulations. "speed": 600, Something went wrong. Eurasia Group's advisory and consulting business is built upon a research platform of leading political risk analysts and management consultants with deep country and sector expertise. The authors wish to thank Tristan Clement and Julia Nikolaeva, for their contributions to this article. Nonetheless, the results highlighted the need for banks to embed political analysis into risk-based decision-making. Note: Political risk consulting firms specializing in analyzing the business risk presented by the political environment in a region or country--including but not limited to regulatory risk in particular sectors, risks of appropriation or nationalization, and broader geopolitical risks. In the next two decades, competition for global influence is likely to reach its highest level since the Cold War. Many governments have introduced laws requiring companies to take actions to mitigate the risk of adverse human rights impacts. Geopolitical risk is the number one global corporate risk. Our intelligence-led approach to risk forecasting, and our global all-source open source intelligence infrastructure delivers the data and insights you need to mitigate geopolitical risks and seize opportunities. Geopolitical risks affecting banks or banks customers have expanded significantly in recent years, according to a global survey report issued late last year from consulting firm EY. Speaking to the Atlantic Council recently, US Treasury Secretary Janet Yellen warned that it is imperative for the United States to work with China to avoid a bipolar monetary order emerging from the war in Ukraine and ongoing geo-political conflicts. Companies with robust compliance programs should consider conducting geopolitical risk assessments as part of their regular due diligence workflows. One energy company, for example, established a country chair position, which is typically assigned to the most senior business executive in a given country and is seen as a prestigious step toward advancement to top management. I would like to see us preserve the benefits of deep economic integration with China, not going to a bipolar world, but clearly thats a danger that we need to address.. @ Thomson Reuters, Sales In much the same way that companies screen for ultimate beneficial ownership or reputational risk as part of their pre-investment or pre-partnership due diligence processes, companies should conduct geopolitical due diligence before entering an emerging or volatile market or ahead of a business partnership with a company in a jurisdiction that they dont have a deep understanding of. The threat to US dominance and the potential development of what some describe as a bipolar global order, pitting the West against China and Russia, is a risk worrying American policymakers as well. Obtain the data you need to make the most informed decisions by accessing our extensive portfolio of information, analytics, and expertise. Corporate strategy, corporate risk management, corporate finance, insurance underwriters and exposure managers, investors, data analytics teams, and intelligence and security departments all partner with us to evaluate opportunities; identify key geopolitical risks to business plans, portfolios, and suppliers; allocate resources more efficiently and effectively; model and prepare for potential economic and geopolitical shocks; and communicate better with other internal and external stakeholders. Shipping will increasingly be drawn into geopolitical disputes," says Kinsey. Violence and Civil Unrest Whether the billions of dollars in losses linked to Russias invasion of Ukraine and subsequent Western sanctions have prompted big banks to increase their geopolitical expertise remains unclear. iStrategic LLC is a Political Risk Analysis and Consulting firm specializing in the Middle East and North Africa region. Sign up to receive periodic news, reports, and invitations from Kroll. As one of the country's top political consulting firms, Global Strategy Group has worked with many diverse and high-profile clients to serve a range of unique needs. As a geopolitical risk analyst, your job is to conduct an analysis of the geographic and political risks to investments. Utilize our expert insight and data to get risk scores tailored to your specific metrics, Benchmarking, Pricing and Aggregation, and Scenario Analysis But the discussions often focus on a specific investment, project, or market entry or exit. Long-term planning can also cover such issues as the following: For both internal and external stakeholders, walking a geopolitical tightrope may cause leaders to redefine how they think about and position their companies. Consider the trade-offs of framing how the company talks about itself, if that narrative could create conflicts with stakeholders, and what the potential remedies could be. Below are several examples in which Kroll was able to help clients anticipate the type, probability and impact of geopolitical volatility on its operations in key emerging markets. "fade": true, Every organization we studied relies on input and expertise from the field. Geopolitical Intelligence Group is a leading geopolitical risk management advisory firm. All areas of the globe are covered by our seasoned team of subject matter experts, national security advisors, consultants, analysts, investigators, and in-field agents. Case Study 3 A client operating in the entertainment industry was seeking to incorporate in a foreign jurisdiction from which it would base its regional activities. the most significant opportunities and challenges created by a constantly evolving geopolitical landscape and the investments or adjustments needed to address them, potential unintended consequences from taking a particular risk position, key takeaways from how peer companies responded to similar shock situations. Operations in countries with poor human rights records can cause supply chain disruptions but can also lead to reputational damage and give rise to class action lawsuits, public boycotts or stockholder divestment campaigns. Subscribed to {PRACTICE_NAME} email alerts. "Heightened political risk globally raises the threshold for unrest, with implications for shipping, such as the ability to secure crews and access ports safely. We call these archetypes holistic-risk evaluators, risk entrepreneurs, systemic-risk managers, and nascent-risk managers. The Great Decoupling. Geopolitics is "the study of the effects of Earth's geography (human and physical) on politics and international relations.". Yet, companies find Geopolitical Risk difficult to fully understand and even more challenging to manage. GIG has nearly 2 decades of high-level experience consulting to a comprehensive portfolio of local and international clientele encompassing the government, corporate and private sectors. strategy. Providing a regular forum for a board to examine pressure points and operating realities from multiple perspectives and air diverging views doesnt just improve decision making and establish an organizations appetite for riskit helps create consensus across leadership on the issues of the day. Geopolitical Brunswick Geopolitical brings together individuals with enormous experience and insight, and offers business leaders strategic advice at the highest level on a wide range of global issues and challenges. Political risk consulting firms. 5. Some of these political consulting clients include: Airbnb. A quick message or email to the global functional marketing, finance, or risk community, the company told us, allows for rapid troubleshooting, the cross-pollination of insights, and the sharing of best practices. A confirmation email has been sent to you. Expropriation 1. 1. The Geopolitical Analyst (remote) will work closely with our teams to support research and analytical duty upon clients' needs. Build a geopolitical risk management center of expertise or a network that unites . Integrated solutions - consulting, risk management and broking - to help organizations prevent and protect against interlinked geopolitical risks. American Express. Derek Leatherdale and Hanif Barma from the Risk Coalition identify in this article the key things that any board or risk committee should consider in the context of the complex and volatile geopolitical environment in which business now operates. 2. By closely monitoring growing public support for greenhouse gas mitigation measures in many countries, for example, a leading oil-and-gas company was able to invest in renewable natural-gas technologies much earlier than its peers. The companies with the most disciplined approach, however, often use a combination of processes and tools to look at risks during different time frames and with different rates of periodic review. /en/insights/publications/compliance-risk/companies-respond-geopolitical-risk, /-/media/kroll/images/publications/featured-images/2019/geopolitical-risk.jpg?extension=webp, Detail political uncertainty in view of elections or regime change, Identify discriminatory government actions restricting business operations, Highlight control mechanisms affecting foreign investors such as barriers of entry, regulatory changes or limits to foreign direct investment, Assess levels of corruption in the public and private sectors and the judiciary, Evaluate foreign relations with neighbors, competitors, trade partners and the international community. Case Study 1 Coco Feng, Chinese president Xi Jinping seeks to rally countrys scientists for unprecedented contest, South China Morning Post, May 29, 2021, scmp.com. A major global technology company offers another good illustration. In a global business environment characterized both by hypercompetition and intensifying geopolitical headwinds, it is no longer enough for companies with global footprints to only react defensively. Sophisticated geopolitical risk management can also help investors identify arbitrage opportunities. Never miss an insight. "autoplay":true, Political risk consulting. From project or investment selection, through market entry and ongoing risk monitoring and management, we can support you with actionable intelligence, business relevant forecasts, and tailored solutions. In extreme cases, a disruptive event can jeopardize an entire business. 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