Marsh, a firm specialising in risk, reinsurance, capital, and management consulting, has highlighted the growing challenges posed by an accelerating geopolitical transition.
According to Marsh, this period represents a level of complexity not seen in decades, with implications for trade, finance, conflict, and digital infrastructure.
Marsh suggests that organisations that view this environment as a catalyst for innovation, differentiation, and expansion, rather than solely as a source of disruption, are better placed to maintain strategic agility and achieve long-term advantages.
In its Political Risk Report, Marsh outlines the main trends in the political and economic landscape likely to affect multinational corporations and investors over the coming year.
The report notes that while business leaders anticipate substantial geopolitical change and global restructuring, they often devote insufficient time to understanding the strategic consequences, focusing instead on short-term volatility.
Marsh emphasises that exposure to geopolitical developments will vary according to a company’s location, sector, and preparedness. Nonetheless, most organisations can expect pressures on both physical and digital supply chains, potential disruption from conflicts, both physical and cyber, and growing political influence over decision-making. Digital infrastructure, including data centres, cloud services, and satellite communications, is increasingly viewed by governments through a competitive geopolitical lens as part of the Industry 4.0 race.
According to Marsh, assessing how changes in the US-influenced international framework will affect operations should form the basis of long-term risk management strategies. These strategies should combine traditional risk transfer measures with proactive resilience-building.
The report also notes practical solutions recommended by Marsh, such as credit and political risk insurance and surety guarantees, which can support credit risk management, stabilise cash flow, and mitigate exposure to counterparty defaults and geopolitical uncertainties.
Angela Duca, Global Head, Credit Specialties, Marsh Risk, commented: “An accelerating geopolitical transition is ushering in an era of heightened complexity unseen in decades, while also creating significant opportunities that prepared firms can use to help turn the emergence of the new world order into a powerful vehicle for opportunity, differentiation, and expansion.
“A shared leadership perspective on the prospects for geopolitical change, when integrated into the planning process and across operational domains, can provide greater clarity and confidence to continue taking risks, pursuing investments, and growing trade in a difficult climate as new allegiances in the global trade architecture emerge.”
