The rapid rise of geopolitical risk (and what it means for your team)

In my entire career as a risk professional, there’s only ever been one challenge I feel powerless to change.

We can simplify processes, streamline reporting and improve oversight. But the ability to turn off? I’ve never quite mastered it – and I’m sure it’s the same for most of you reading this.

And no, it’s not just the fact we spot little risks everywhere, like the hob being left on or toys scattered on the floor by the little ones. It’s the fact that you find yourself so closely in tune with the state of the world.

Whether it’s warfare worries or talk of tariffs, we know deep down that as far away as these things may feel, they can end up having a big impact on our risk management.

Here, I’ve compiled a few of the biggest geopolitical risks I think every risk team should be aware of – and what they could mean for your risk function.

What is geopolitical risk?

The Corporate Governance Institute defines geopolitical risk as the “collection of risks facing companies that stem from conflict or other tensions worldwide.”

As much as it’s easy to think of this purely as sweeping, large-scale threats like regional conflicts or pandemics, the Institute is quick to note that they don’t have to be global to be impactful – even localised risks can be enough to threaten a company.

I’d also add that it’s easy to get caught up on the ‘political’ element.

The involvement of government doesn’t automatically make something geopolitical. Similarly, politicisation can be much more subtle than we first think, as will become clear when I mention some of today’s biggest geopolitical risks.

What are today’s biggest geopolitical risks?

It probably goes without saying that there are too many to list in a single post.

But from my own experience, research and conversations with fellow risk professionals, I’ve pulled together a few of the big hitters that everyone, regardless of size or industry, should be clued up on.

That doesn’t mean you should go away and shape your strategy around what I mention here. Just that they should be firmly on your radar.

The growth of economic confrontation

As risk professionals, we’ve long learned to keep an eye on the economic landscape.

But there’s a big difference between traditional trade competition and what we’ve seen throughout 2025, where economic policy is increasingly used as a tool for geopolitical leverage.

In fact, geoeconomic confrontation has easily topped the World Economic Forum’s list of global risks for 2026, with 18% of respondents viewing it as the risk most likely to trigger a global crisis and 68% expecting a “multipolar or fragmented order” over the next decade.

It’s not hard to see why. The obvious example is Trump’s tariffs, which have characteristically dominated headlines and kept the world guessing, but it’s also worth noting a global shift towards protectionism.

This has a huge bearing on us as consumers, but also as risk professionals – especially those who manage imports, exports and supply chains.

Armed conflict & regional wars

Despite me saying it’s not all about the big stuff, the impact of tangible conflict can’t be overstated.

There’s the obvious element of humanitarian harm that’s hard to watch, even from a distance. After all, I’ve never met a risk professional that wasn’t hugely empathetic.

But we’d all be lying if we didn’t admit to thinking about the broader implications. Not just for safety, but the nitty gritty and the day to day. Disruptions to supply chains, huge changes to trade routes, big blows to investor confidence.

Competition over technology

Didn’t think AI, semiconductors and infrastructure could be geopolitical? Think again.

Global powers big and small are racing to establish dominance in a number of new technological fields.

The upside, of course, is that new tech is being rolled out at a rapid rate, much of which is important and well-intentioned. The downside is that an increasing amount of the time, speed is being prioritised over safety and regulation.

This can end up undoing the goodwill of emerging technologies by coming back to bite consumers and businesses.

Not to mention, it has implications on a global scale. Fierce competition in these fields risks hotting up the geopolitical landscape even further – even creating new spheres of influence and determining which countries businesses are willing to work with.

Oh, and this kind of thing rarely stays regional. The effects can be quick to ripple through markets and make their way back to your team.

Political divides & instability

Polarisation is everywhere.

And it doesn’t just make for awkward conversations with the in-laws. When things in our home countries are in a constant state of flux, that can have huge implications for the wider world.

It means governments can struggle to commit to long-term strategies, sustain international agreements, and even take decisive action in a crisis.

For us risk professionals, that can mean rapid shifts in policy, sudden changes in trade or regulatory direction, and a rulebook that feels like it’s constantly being rewritten.

Climate change as a risk multiplier

It’s not just that geopolitics affects climate change. The latter affects the former, too.

This is a sentiment echoed by the German Council on Foreign Relations (DGAP), which notes that there must be an equal focus on how the costs and damages of climate change are shifting global dynamics.

Often, our changing climate is “arising in connection with economic decline, uninhabitability and uneven impact distribution.”

Far more than an ESG checkbox, then. Climate risk isn’t a standalone concern – it underpins almost everything in the geopolitical landscape.

What does this mean for risk managers?

I know, I know – it sounds like a lot.

And by all means, it is. But if there’s one thing I know for sure, it’s that GRC professionals are made of tough stuff.

And with the right mindset and strategy, the rise of geopolitical risk is nothing to be afraid of.

Whether you’re in a team of two or twenty, these are my three quick takeaways that I think you should know.

Geopolitical Risk is no longer lurking in the background

Supply chains, market access, cybersecurity – it’s here, and it’s affecting everything.

This isn’t just something that should provide a bit of context on your slide decks. Depending on your size, it should be feeding directly into your day to day.

The old ways of working aren’t enough

Traditional models of risk and static frameworks tend to assume stability, at least to some degree.

But, at risk of sounding trite, stability is something we don’t have the luxury of right now. With all of us needing to expect the unexpected, it’s no longer enough to just look back. Dynamic processes and scenario-based thinking are a must.

We’re no longer here to just control risks

We need to strategically interpret them.

You can expect to be more involved than ever in board-level planning discussions and judgement calls.

Is that daunting? A little.

But one thing’s for sure: our role is more valuable than ever.