"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. Channeling the policy debates under way in the European Union, The businesss board can apply a materiality test to pinpoint what it should dedicate time to discussing. Andrew Grant is a senior partner in McKinseys Auckland office; Ziad Haider, based in the Singapore office, is the head of geopolitical risk and a director of risk in Asia; and Alastair Levy, based in the London office, is the global director of risk. . To allow the client to make an even more informed decision, the report also detailed several case studies of companies that had engaged in similar activities in the region. Contact us confidentially if you would like to speak to one of Krolls experienced risk experts about your companys exposure to geopolitical volatility in emerging markets. Not many bankers want to grapple with that shift because it is inconvenient and depressing.. Geostrategic Business Group | EY - Global Close search Trending Why Chief Marketing Officers should be central to every transformation 31 Jan 2023 Consulting The CEO Imperative: How will CEOs respond to a new recession reality? Instead, boards can dedicate regular standing time to analyzing how to respond to the geopolitical risks that their enterprises face as part of a broader board effort to build more resilient companies. Trade Wars and a Stronger Europe. Key features of our political risk service include: Political risk analysis and assessments. Depending on the circumstance, a companys leaders may have to weigh the effect that political or media scrutiny on the companys operations in one area has on its holdings in other locales. Access daily analysis of world events, detailed country reports, proprietary country and sovereign risk ratings, and comprehensive economic forecasts and historical data to assess your companys investments and future growth, Foresight Security for Corporate Security When companies consider opportunities in emerging or volatile markets whether through acquisition, merger or growth it is essential for them to understand the potential impact that geopolitical events can have on their business activities. This website uses cookies. Conduct time-efficient international policy monitoring and updates. 11 Jan 2023 CEO agenda Six ways asset managers can prepare for an uncertain future 2 Feb 2023 Wealth and asset management Create a system for collecting, processing, and disseminating risk signals with a variety of time horizons or purposes across the organization, supplemented by input from external agencies and advisors. 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. SVA. Successful geopolitical risk managers tend to hire a cadre of personnel with experience in doing business in the market and dealing with local agencies. Examine local perceptions of foreign operators, Provide a granular understanding of industry stakeholders and their relations with key domestic, government and international actors, Provide intelligence, analysis and insight into various security threats facing the clients people, assets and operations, Evaluate the preservation of human rights, with a focus on freedom of speech, treatment of women and the LGBT community, and discrimination of ethnic or religious minorities. New York NY 10055. There are no reliable historical streams of data that one can easily plug into a model. Our methodology allows us to assess differences in operating models and the degree of process maturity relative to industry practices as well as to identify opportunities for improvement. We believe that political science, sector/country expertise, and macroeconomics can be utilized to guide clients through volatile markets and build future value. And a narrative that works in one place could inhibit market opportunities in another or create sensitivities among regions. Yet few companies consistently act on it. trust us to help them make informed decisions, Professional services We offer a unique combination of advanced analytical methods and an innate understanding of intelligence gathering other security sources don't possess. and risk management resources for todays professional services 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. Supporting corporate third-party management programs to drive risk-based due diligence decisions. 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. Leveraging Our Expertise to Navigate Geopolitical Risk. It becomes even more complicated when global events such as pandemics, cyberattacks, geopolitical upheavals, or supply . Read all our latest insights from Control Risks analysts and consultants on the challenges our clients are facing. Economic and Geopolitical scenarios Human Rights Violations To ingrain the importance of external relations throughout their organizations, some companies rotate high performers and potential candidates for upper management into country leadership positions, where risk management becomes one of their duties. Yet, companies find Geopolitical Risk difficult to fully understand and even more challenging to manage. 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. Discussions can focus on three risk areas: brand and reputation; operational issues, such as cybersecurity strategy; and products, services, and partnerships. Intelligence-led solutions for underwriters and insurance exposure management teams to efficiently identify, evaluate and monitor risks and opportunities at country, region and location specific levels, A credible, independent view of external operational and strategic risks and the tools to integrate those risks into your financial evaluation, Improve the quality of investment decision-making with pressure-tested macroeconomic and sector inputs, expert political analysis and scenario alternatives, {"items" : [ 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. Sign up to receive periodic news, reports, and invitations from Kroll. 4 Technology, especially, has become what Chinese president Xi Jinping has called the main battleground of global power rivalry. However, it added, "only a subset of chief risk officers (CROs) recognize this." Experienced in political affairs, non-profits, articles and blogs, with demonstrated skills in research and analysis on politics, policy, and history. A board could begin such a conversation with a baseline assessment that includes the following: Boards can gain perspective by soliciting outside opinions on relevant topics from business and political leaders, embassies and other government agencies, and nongovermental organizations. For example, the Iran nuclear talks have significant regional and global consequences. Forecasting government action and decisions. Global geopolitical risk and economic uncertainty have increased dramatically over the past decade, according to leading indices. Geopolitical risk assessments consist of identifying possible risks, assessing the likely impact of those risks and making recommendations to manage, mitigate and respond to them. Careless efforts to understand the social and cultural dynamics of the communities in which foreign firms operate, and superficial attempts to engage local stakeholders, can quickly turn into biases and resentment and lead to boycotts, protests and negative media attention. In-depth analysis, they recognize, does not come solely from algorithms. Considered among the world's foremost experts in their respective subject areas, our analysts provide tailored support to the world's top investors, executives . We hosted our 6th annual Top 10 Geopolitical Risks event today with KPMG global alliance partner, Eurasia Group, and we highlighted the relevance of the risks One stream is to work for consultancies - i.e. "arrows": false, Large US banks were not alone in underestimating the determination of Russian president Vladimir Putin to ignite the biggest European conflict since World War II. Prudent geopolitical risk management also requires understanding how to deal with issues that cross borders. Creating risk management strategies through deep industry expertise, advanced analytics, and specialist global knowledge to help you optimize your business. In volatile times such as these, a companys instinct is to focus on defenseto protect the business from harm. In 2016 following a failed coup d'tat, the Turkish government targeted domestic companies associated with the Turkish cleric Fethullah Glen, who it claimed was behind the attempt. Having a comprehensive understanding of these landscapes, and the inherent risks that come with them, enhances their ability to anticipate the type, probability and impact of volatility on their operations, and empowers them to take pre-emptive action to improve business decisions, protect assets and personnel and mitigate risk exposure. In such discussions, its of utmost importance to make sure that all affected geographic regions are represented. Accurately forecast, quantify, and compare the financial viability of new investments and existing business activities by sector and project type, Bespoke Risk Scoring Our privacy policy describes how your data will be processed. 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. Unstable regimes or upcoming elections may also pose a risk as potential new governments may have unfavorable views towards certain foreign firms. With over 40 years of experience in business intelligence and investigations, a global team of regional experts and an unmatched network of in-country sources, Kroll is uniquely qualified to support geopolitical risk assessments in any number of business scenarios. We support each client's unique risk profile . Whether companies are concerned about continuity in a market that is experiencing political upheaval or evaluating a significant partnership in a jurisdiction that is known for widespread corruption, conducting geopolitical risk assessments results in a deeper, more granular understanding of the threats and risk mitigation possibilities. Adept & highly organized self-stater. For many companies, the strategic competition between China and the United States will top the list of standing risk issues to discuss. Integrate geopolitical signals and risk assessment into strategic-planning processes and define actionable strategies to both protect the business and take advantage of emerging opportunities. Geopolitical Intelligence Group (GIG) is a leading provider of intelligence services, offering strategic and operational insights into the complex geopolitical environment that affects businesses. The value of being able to anticipate, synthesize, and harness risk for potential gain has never been greater. Learn More link icon. With tectonic shifts in geopolitics rumbling from Chinas reemergence on the global stage, a climate crisis, and the Fourth Industrial Revolution, companies must be on guard. According to the World Economic Forum in its 2023 Global . Tailored, high-impact executive workshops, Speaking engagements and macro strategy conversations. Building a more holistic and entrepreneurial approach requires action in all three dimensions: enhancing the strategic role of risk management, ingraining it into the organization, and developing robust processes. For decades, companies built their . 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. Companies are walking a geopolitical tightrope. 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. . Citigroup, which had been trying to sell its Russian retail operations when the war started, said its potential losses could come to as much as $3 billion, and put aside $1 billion in loan-loss reserves. Indeed, in its most recent geopolitical risk dashboard, the BlackRock Investment Institute put a technological decoupling between China and the United States as the third highest risk, with a widening of the conflict in Ukraine between NATO and Russia and major cyber-attacks causing significant damage to infrastructure and financial markets seen as the top two risks. Related Expertise: Leverage unparalleled Country risk mapping. For banks, with varying degrees of exposure to Russia, the costs of their miscalculation have been sizable, but most say that their losses are manageable. Citi. 3 Commodity prices rose sharply 4 after Russia . Case Study 3 Nowhere is the fallout from current geopolitical tensions more apparent than the unfolding competition between China and the United States. As potential new governments may have unfavorable views towards certain foreign firms from.. In another or create sensitivities among regions talks have significant regional and global.... 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