Escolar Documentos
Profissional Documentos
Cultura Documentos
as Chief
Geopolitical
Officer
Rohitesh Dhawan
Director, Strategy and Alliances
Eurasia Group
Sean West
Deputy CEO and
EMEA Managing Director
Eurasia Group
KPMG International
kpmg.com/geopolitical
Today’s geopolitical environment is nothing
like what we’ve seen in the past. CEOs are
beholden to the outputs of an increasingly
complex geopolitical system that moves at
an accelerated pace, with few guardrails.
Outcomes are hard to predict without
careful focus. Time to react is limited. Only by
moving politics to the forefront of strategy,
and personally being the point (wo)man for
geopolitics can a CEO lead their organization
to success in turbulent times.
© 2018 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated.
Geopolitics:
a boardroom issue
Adapting to today’s changing landscape.
Politics is nothing new — companies away. Plus opportunities from political
have long seen their fortunes rise and shifts can be exploited by competitors
fall on the decisions of lawmakers and before a CEO even understands what is
the onset or cessation of wars. Many occurring.
have become quite good at reacting to
This report reasons that only by moving
events or at least buying insurance to
politics to the forefront of strategy can
limit risks like expropriation. Teams of
a CEO adequately steer today’s global
lobbyists and public relations companies
businesses. Such thinking starts with
fight for the opportunity to express the
an acceptance that global companies
wishes of their client businesses and
are assumed political entities and CEOs
react to limit damaging events.
de-facto political players. It means
However, today’s geopolitical recognizing that a different approach is
environment is nothing like what we’ve required, one that elevates politics in
seen in the past. CEOs are beholden to the boardroom and puts it on a par with
the outputs of an increasingly complex other strategic challenges. Furthermore
geopolitical system that moves at an it requires CEOs to personally play the
accelerated pace, with few guardrails. role of Chief Geopolitical Officer (CGO),
Outcomes can be hard to predict using specialized insights and stress-
without careful focus. Time to react testing tools to focus the company’s
is limited. Downside risks may often attention on managing an increasingly
be too esoteric to adequately insure uncertain environment.
Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2016 2017
Legend: Periods where the impact of politics on the global business environment is positive (above the line) or negative (below the line)
While opinion may be diverging on the that have expanded into frontier and
current speed and future forecasts for emerging countries with potentially
globalization, it has undoubtedly added weaker institutions, civil unrest and low
to the complexity of today’s corporate resilience. At the same time, previously
world. Companies have transitioned ‘stable’ developed markets can also
from national, to multinational and for become politically turbulent from the rise
some, to global corporations. CEOs find of populism, nationalism and country-first
themselves facing new, unfamiliar and approaches to international trade.
complex situations — often resulting
For the global CEO, the odds are
from geopolitical issues — which
increasing that it is a geopolitical event
they may have had limited exposure
they must explain as the root cause for a
to in their previous core markets.
performance challenge.
Exposure to this political instability can
be particularly marked for businesses
a. The line graph summarizes a GDP-weighted diffusion index of all Political Trajectories. At points above 0,
most of global GDP is represented by countries with improving Political Trajectories (month/month); below
0, most of global GDP is represented by countries with declining Political Trajectories (month/month).
1. Eurasia Group analysis of proprietary, International Monetary Fund (IMF) and World Economic Outlook
(WEO) data.
2. 10 biggest corporations make more money than most countries in the world combined, Global Justice Now,
12 September 2016. (https://www.globaljustice.org.uk/news/2016/sep/12/10-biggest-corporations-make-
more-money-most-countries-world-combined)
Lord Malloch-Brown
former UK and Global Civil
Servant and now Senior ”There were many political decisions I did not agree
Member of multiple Boards with and wanted to speak out against. But I knew that
if I went public with my views, I would alienate a
significant portion of customers and employees. So
I tended to keep my head down, but if asked, would give
my honest opinion.”
Former head of a global insurance giant
Business model —— The loss of access to a key geographic market, perhaps as a result of
sanctions, damaging political interference or even loss of cross-border
The attractiveness and feasibility
passporting arrangements.
of aspects of the business model,
such as geographical footprint, —— Restrictions imposed by new product regulation or issues product/
product attractiveness and customer material supply chains.
profile, may also be challenged by
—— The impact of a significant deterioration in customer sentiment.
geopolitics.
3. Emerging technologies drive more risks than firms can protect against, Global Trade Review, 17 January
2018.(https://www.gtreview.com/news/global/emerging-technologies-drive-more-risks-than-firms-can-
protect-against/)
4. We’re not ready yet for a flu pandemic, Gulf News, 10 January 2018.(http://gulfnews.com/opinion/thinkers/
we-re-not-ready-yet-for-a-flu-pandemic-1.2155062)
Authors
Rohitesh Dhawan Sean West
Director, Strategy and Alliances Deputy CEO and
Eurasia Group EMEA Managing Director
T: +44 (0)7770 221 062 Eurasia Group
E: dhawan@eurasiagroup.net T: +44 (0)7478 884 284
E: west@eurasiagroup.net
Contacts
Eurasia Group KPMG
Alexander Kazan Andrew Mantilia
Managing Director, Global Strategy Director
Eurasia Group Global Lead — Geopolitics
T: +1 646 291 4076 KPMG International
E: kazan@eurasiagroup.net T: +44 (0)7468 350 805
E: andrew.mantilia@kpmg.co.uk
Ashish Sarkar
Director
Global Strategy Group
KPMG in the UK
T: +44 (0)7468 718 659
E: ashish.sarkar@kpmg.co.uk
kpmg.com
kpmg.com/socialmedia
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Publication name: The CEO as Chief Geopolitical Officer
Publication number: 135323-G
Publication date: March 2018