{"id":14359,"date":"2026-09-07T12:34:44","date_gmt":"2026-09-07T10:34:44","guid":{"rendered":"https:\/\/insights.ieseg.fr\/?p=14359"},"modified":"2026-09-07T12:49:23","modified_gmt":"2026-09-07T10:49:23","slug":"geopolitical-risks-impacts-strategic-responses-companies","status":"publish","type":"post","link":"https:\/\/insights.ieseg.fr\/en\/resource-center\/management-society\/geopolitical-risks-impacts-strategic-responses-companies\/","title":{"rendered":"Geopolitical risks: What impacts and strategic responses for companies?"},"content":{"rendered":"\n

What is the impact of these geopolitical shifts on the economy in general and on businesses in particular?<\/h2>\n\n\n\n

Syrine ISMAILI-BASTIEN<\/em>: For the economy in general, we often refer to the resulting market shocks. Geopolitical shifts caused by wars, sanctions, or even trade tensions, often cause volatility in financial markets or currency fluctuations which can lead to inflation. In recent times, most people will remember the soar in energy and commodity prices that followed the Russia-Ukraine conflict and the impact on the global economy.<\/p>\n\n\n\n

A second important impact stems from the logistical disruption caused by such events. Conflicts or blockages to maritime trade for example, can disrupt supply chains, create shortages, and cause price rises. This was the case with the Suez Canal blockage in 2021<\/a> and it\u2019s still the case with the tension in the Red Sea and more recently with the blockade of the Strait of Hormuz<\/a>. For companies, this can lead to rising costs and uncertainty.<\/p>\n\n\n\n

The rise in costs can stem from changes in the prices of raw material or energy, but also those related to insurance and security measures<\/a>. Transportation costs are of course also impacted due to the increase in fuel prices and longer transit times for example when rerouting<\/a> is required to avoid certain areas which may be unsafe or unstable. Costs are also further accentuated by currency volatility which impacts corporate financial management.<\/p>\n\n\n\n

Finally, companies are faced with increased uncertainty, notably in terms of regulations. Geopolitical shifts create compliance risks. For example, the introduction of sanctions or embargos can impose strong constraints for companies such as export bans or controls. Many western companies have had to withdraw or to adapt their activities in Russia and in Iran. Trade wars, such as the US-China case, may also force many companies to rethink their commercial strategies<\/a>.<\/p>\n\n\n\n

Are certain sectors of the economy more affected than others?<\/h2>\n\n\n\n

Syrine ISMAILI-BASTIEN<\/em>: The quick answer would be the energy-related shipping sector since there are major changes in the sector with oil, gas and minerals travelling longer distances. However, when we consider that over 90 percent of the goods around the world travel by sea, all industries are affected. However, the impact is even greater for those related to oil\/gas such as the automotive or aerospace sectors.<\/p>\n\n\n\n

It\u2019s also important to note that some other sectors benefit from such tensions. This has been the case for private security or cybersecurity. Meanwhile, there have also been discussions and debates in some countries \u2013 such as in France \u2013 about which actors benefit from the rise in energy prices<\/a>.<\/p>\n\n\n\n

Are large multinationals impacted more heavily than small and medium-sized enterprises?<\/h2>\n\n\n\n

Syrine ISMAILI-BASTIEN<\/em>: Statistically speaking yes. As multinational corporations operate in numerous countries. they are therefore exposed directly to a variety of geopolitical risks. They can face economic sanctions in one region, or political instabilities and\/or regulatory changes in another. While a crisis in one region might be offset by the company\u2019s performance in another region, certain global crises like the Covid pandemic or trade wars can have a massive impact on the overall group. It is important to note, however, that while SMEs may be less exposed at the international level they can also suffer indirectly with supply chain disruptions or falling demand.<\/p>\n\n\n\n

How are businesses adapting their strategies in response to geopolitical shifts?<\/h2>\n\n\n\n

Syrine ISMAILI-BASTIEN<\/em>: This is a big question. Firstly, I think it is important to highlight that, despite multiple crises in recent years, companies are still underprepared for geopolitical shifts and crises<\/a><\/p>\n\n\n\n

Unfortunately, many companies often still operate reactively, treating geopolitical disruption as exceptional events, rather than as a permanent feature of operating in a global economy.<\/p>\n\n\n\n

Companies need to develop and regularly update plans that account for disruption in key regions where they operate. They need stronger contingency planning and more solid integration of geopolitical risk into strategic planning.<\/p>\n\n\n\n

There are several strategies that I would like to highlight:<\/p>\n\n\n\n