Geopolitics is no longer a threat – it is a strategic variable. From high power competition to technological changes and a fracture of the order of exchanges, today’s volatility reshapes global affairs. Oliver Jones, leader of the Ey-Parthenon group of geostrategic companies, says Global finance The way in which prospective companies incorporate geopolitical thinking in their risk frameworks, their investment decisions and their long -term planning.
Global finance: What are some of the most urgent geostrategic risk factors that should be concerned about companies in the coming months?
Oliver Jones: I think I would start by saying that many of the problems that affect companies are worldwide. Thus, the way I often see it is to understand the trends that underlie risks and opportunities in several regions.
If you look at the prospects for 2025, we identify three very large themes. One is the transition from this 2024 super electoral cycle to a new government, and therefore new political elaborations.
The underlying trend two is the type of re-emergence or the strengthening of geopolitical rivalries, almost a type of old-fashioned geopolitics around whom has the most energy, and the active conflicts / wars that unfortunately exist and continue.
Third, is a transition to economic competition. It is no longer nearby, nor to friends of friends. There is a real bonus that industrial activity is on the ground on its own internal market. Now we see some of the most recent interventions, for example, aiming to try to compete around things like models of great language and generating AI, and this is considered an area of economic competition.
Girlfriend: What does this mean for international affairs and how should they plan for the future?
Jones: One of the characteristics of this landscape is that geopolitical risk, but also the geopolitical opportunity is in almost all geographies at the moment. And so the interesting question for conference rooms and the rest is the place where opportunities can lie. Where do the rules of the game become more level? How can I change my investment planning far from being almost in survival mode to a question of prosperation and to seize opportunities.
Girlfriend: So, if we could think of geostrategic risks and the analysis of opportunities in terms of framework. Where to start?
Jones: It is really important to professionalize your approach. The first thing to do is to scan the environment, and scanner means understanding the outside world and understanding the forces that shape your environment. It seems very basic, but we know that many companies are really having trouble doing it. It is also very important to adopt a quantitative approach on this subject rather than a simple qualitative approach and to have a wide range of votes and evidence in order to really understand what is happening. The second is to concentrate, and what we mean by this is to focus on what it means for the company – the impact on the future strategy. You must really integrate geopolitics into your existing risk management frameworks and it is important to know that these risk management frameworks have one vote on the board of directors.
Girlfriend: Who should be responsible for understanding geopolitical risks and opportunities?
Jones: The proof that we have for the moment is that there is not a specific governance format. Sometimes it is an individual who receives responsibility. Sometimes it is a committee given the responsibility. But there are two things that are absolutely crucial, including a specific person or a specific body must have a head responsibility. This cannot be something that is distributed between three or four parts of the company. There must be a single entity that has an ultimate responsibility.
The second crucial thing is that this entity – whether it is an individual or a group – will have to extend to the whole business. They must be able to automatically see the image on all the different functions because geopolitics affects all parts of the companies.
Girlfriend: Where do you see the CFO and the best appropriate financial function in terms of geostrategic risk analysis?
Jones: I think that the financial director and the financial function should be at the heart of each stage, and the reason comes up to the point that geopolitics affects so much different dimensions of your business. For someone and the financial director, it is crucial that he understands these problems, but that all the different aspects of the company also understand these problems and react in the right way.
I think that the financial function, more generally, can play an important role in the quantitative modeling of these impacts – which happens to the cost base; What it does to potential income in all the different dimensions of the company and how to integrate this into the strategic plan. It is clear that it is at the center of the agenda of any CFO.