Awareness of Geopolitical Exposure: A Review of Industry Responses

A white paper by S4GEO, the Society for Geopolitics

Geopolitical risk dominates many business risk surveys, yet there remain uncertainties over just what constitutes “geopolitical risk” and thus about just how to manage geopolitical concerns. 

Geopolitical risk is considered a top disruptor to global, domestic, and company growth, and 96% of CEOs expect it to remain a major issue in the immediate future. It has prompted 71% of CEOs to plan alterations to their supply chains, a figure that has increased by nearly 50% since last year. At the same time, only 34% of experts are confident in their organization’s ability to navigate it.

Geopolitics can be daunting. It’s a nebulous term that everyone hears but few can define. Even leading organizations that conduct surveys about geopolitical risks to business don’t seem to agree on what geopolitics entails. McKinsey’s economic conditions outlook focused on disruption from trade policy, whereas BCG released a report focusing on the geopolitics of tech, including threats like international AI competition and protectionist national security measures, which they say will impact companies across industries. Definitions even seem to change within organizations over time; EY grouped geopolitical tensions alongside “macroeconomic uncertainty” and “political risk” in 2024, but as “conflicts, political instability” in 2025. Other surveys mentioned concerns about specific armed conflicts, such as war in Ukraine and instability in Asia-Pacific.

This gives us a definition of geopolitics that is somewhere between war studies and economics, ranging from tariffs and trade policies to military incursions. To this point, one report noted, “51% of US CEOs see US national debt and deficits, followed by decoupling or derisking from China, as the greatest external geopolitical concerns for their businesses,” a broad range of concerns indeed. Despite its breadth, this definition still fails to encapsulate serious geopolitical concerns like foreign cyberattacks, which worry 45% of American and 35% of European CEOs. In fact, some surveys explicitly categorized cybersecurity risks as separate from geopolitical risks.

The poor working definition of geopolitics highlights a common misunderstanding about geopolitics– namely, that it concerns nothing but a series of unrelated news stories. This perspective overlooks the patterns and theories that make sense of geopolitics. Armed with these theories, geopolitical experts can advise on avoiding risks and seizing opportunities through evidence-based predictions. Without them, the world is unfathomably complex, the task of finding meaning exceedingly difficult. 

The disruptive power of complexity is reflected in risk experts’ own struggles with communicating with their companies. When asked what keeps them from communicating risks to business leaders, 48% of risk leaders cited the complexity of weighing risks and rewards while managing downstream impacts. 46% say that they lack reliable means of quantifying risks, while 38% find it difficult to identify risk interdependencies, and 34% specifically reference their lack of expertise in geopolitical or country-specific risks.

Despite this, only 29% had taken the time to establish relationships with key government officials to help their company manage geopolitical risks, while only 42% of companies surveyed had brought in outside advisors with geopolitical expertise. It’s no surprise, then, that another survey found 72% of their respondents reporting losses driven by geopolitical risk, some in excess of $50 million. In a survey of 1,200 CEOs from around the world, only 30% said that they felt they had full visibility on their company’s geopolitical risk profile. Similarly, a survey by McKinsey found that only 33% of organizations were confident in their ability to manage trade policy changes.

With such high stakes, risk experts’ apparent false sense of security could prove disastrous. Whereas CEOs tend to agree that geopolitics pose a serious risk to their companies, the experts that they hire to manage risk seem to underestimate geopolitical factors; only 17% of risk experts recognize geopolitical risk as a serious risk to their company and 73% are mostly or very confident in their ability to advise business leaders on geopolitical risks. This, despite nearly half of those same experts reporting that they faced serious difficulties in communicating geopolitical risks to their companies, and nearly three quarters of companies having taken hits due to geopolitical oversights. Similarly, whereas a 2020 survey found only 30% of respondents were concerned about risks from political violence, 50% of respondents in a 2025 follow-up reported actual losses related to such risks. In sum, in-house risk managers might not be intimidated by geopolitics, but they’re not effectively protecting companies from those risks, either.

While CEOs have become more aware of these blind spots, their responses trend towards haphazard. Businesses have begun widely implementing new practices to address geopolitical risk, but on infrequent bases. One study found that 96% of respondents had invested in new political risk management capabilities in the past year. Another study zoomed out on the timeline; since 2021, the share of company boards regularly assessing geopolitical risks more than doubled, from 40% to 84%. This includes activities like receiving political risk briefings from internal and external experts, incorporating geopolitical risk into decision making, and having a board committee specifically responsible for geostrategic oversight. However, only 32% of companies’ boards engaged in these practices on at least a quarterly basis, with 55% incorporating these strategies on an annual basis, and 13% even less frequently.

This scattershot approach, undertaken infrequently and without expert guidance, means that actions undertaken to mitigate geopolitical risk exposure– like the  ¾ of CEOs localizing parts of their production in the country of sale, or 71% planning to alter their supply chains in coming years– may fail to fully account for current and future shifts in the geopolitical landscape, and thus may miss opportunities or fail to appreciate short- versus long-term dynamics..

Expert understanding turns risk into opportunity. As was detailed above, most CEOs recognize geopolitics as a serious source of risk, which many general risk experts have difficulty communicating and quantifying. However, only 15% see trade environment changes as an opportunity for company growth, while 66% of respondents lack confidence in their ability to navigate trade-related changes. Another survey found only 32% of respondents expecting more opportunities in the next 12 months, whereas 57% of CEOs expect geopolitical risk to remain elevated over the next year.

Risk, in general, means opportunity for those who understand it. However, geopolitics risks present a particularly ripe opportunity for those who understand it. As competitors fumble the geopolitical risk game, those who can navigate the minefield will be able not only to avoid losses, but also to preempt opportunities for growth. In this way, an expertly crafted geopolitical strategy is a master key to long-term success. The Society for Geopolitics (S4GEO) is bringing together geopolitical risk practitioners, corporate consumers, and business schools to strengthen the field of geopolitical risk analysis, working collaboratively to enhance international business resilience and create reliable frameworks for navigating a complex and changing international environment.  

Malia Marks
Malia is a PhD candidate in psychology at the University of Cambridge, where she studies authoritarianism and modern propaganda. Her research interests include evolutionary and cultural psychology, as well as human-computer interaction with emerging technologies like social media and AI. She can be contacted at malia@s4geo.org.