Understanding the geopolitical risk landscape
Global risksInfographicApril 24, 2017
Geopolitical Risk Mitigation: How can businesses and governments develop a deep understanding of connected risk in order to mitigate successfully?
Geopolitical risks are complicated to evaluate. They are interconnected and often highly volatile, prompting shifts between global power centers and impacting businesses. This is why businesses and governments need to understand the deep connections between risks and find innovative ways to mitigate them.
To show how easily risks can quickly cascade, creating a complex and volatile geopolitical situation, the Zurich Risk Room analyzed the network of factors that contributed to the Arab Spring of 2011. Their work formed the basis of a model that businesses can use to help understand their exposure economic disparity. The key is for businesses to understand that in a world connected by the internet and globalization, a company can be affected by geopolitical risks crystalizing halfway across the world.
Understanding how risks are connected
By broadening their view of geopolitical risk businesses and governments can begin to see that risks never exist in isolation. Understanding how risks feed into one another can begin to inform an effective risk mitigation strategy.
Businesses and governments must focus not only on the risks themselves, but on how risks are connected.
A single risk can quickly cascade, causing far reaching geopolitical impact
Staggering Implications
The Our World Transformed: Geopolitical Shocks and Risks 2017 report demonstrates the staggering implications of interconnected risks, with 3 geopolitical risk scenarios. While speculative, these scenarios show how connected risks can coalesce with dramatic effect.
Please select a category and a scenario
In this study, a singular base-case scenario is used to get a sense of the possible deviation from what most assume will be the future trend. The timescale is to 2035, allowing a view of these uncertainties' long-term impact.
- GDP$141400billion USD
- Upper and Middle Class3950million people
- Instability-countries
- Extreme Poverty710million people
What can businesses and governments do?
Identify the key risks
Broaden your view
Develop innovative mitigation strategies