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Risk leaders navigate geopolitical turmoil with confidence, despite critical gaps
Confronted with a rapidly changing world order, most risk leaders say they’re up to the challenge. Nearly three-quarters are mostly or very confident in their ability to advise business leaders on geopolitical risks, according to our May 2025 Pulse Survey. And only 17% consider geopolitical uncertainty a serious risk to their company.
But do they have the full picture? Most risk leaders acknowledge they face challenges with data insights, risk ranking and influence that prevent them from clearly communicating risks to business leaders. At the same time, most haven’t implemented the leading practices needed to manage geopolitical risk, like hiring outside experts and establishing relationships with key government officials.
This disconnect suggests their confidence may be overstated. As we enter a new post-globalization era marked by fractured and shifting alliances, most risk leaders haven’t taken the basic steps to understand and manage these novel risks. Meeting the moment will require new thinking, not a business-as-usual mindset.
Obstacles to clearly communicating risks
Advising the C-suite on risks to the company is hard enough when you have the right data, expertise and collaboration. Without these key inputs, you’re driving blind.
Most risk leaders we surveyed acknowledge they face challenges communicating risks to other executives. About half cite the complexity of weighing risks and rewards while managing downstream impacts, the lack of a reliable means for quantifying risks or the lack of early involvement in strategic business decisions. Roughly one-third say they have difficulty identifying risk interdependencies and lack expertise in geopolitical or country-specific risks, or lack expertise in economic risks.
How can risk leaders assess and prioritize risks if they have trouble quantifying them and weighing them against rewards? What insights can they provide if they lack the relevant expertise or they’re not included early on in key decisions? The prevalence of these challenges points to fundamental gaps in the ability of risk leaders to effectively advise their business counterparts.
Confidence drives action, but risk leaders still aren’t doing enough
With the geopolitical landscape shifting from 30 years of relative stability and the rule-based order of the last 80 years, most risk leaders think they’re ready for the moment. Three quarters (73%) are mostly or very confident in their ability to advise their C-suite peers on geopolitical risks. Despite this confidence, under half (45%) have conducted scenario planning, while even fewer have hired outside geopolitical specialists (39%) or established relationships with key government officials (29%). These are necessary steps to manage geopolitical risks. Even more telling, none have implemented all six leading practices we surveyed for managing geopolitical risks. This, coupled with the capability challenges noted earlier, points to a potential blind spot.
We analyzed the extent to which risk leader confidence is correlated with the actions they’ve taken. We split the risk leaders into two groups based on self-reported confidence. The 73% who report being either mostly or very confident are what we refer to as the “more confident” group. The remaining 27% report being either not confident or somewhat confident (“less confident”).
Risk leaders who are more confident in their ability to advise business leaders on geopolitical risks report taking more action to manage those risks. The more confident group is more likely to have done scenario planning (50%) than the less confident group (32%), conducted supply chain risk assessments (57% versus 45%) and hired outside advisors with geopolitical expertise (42% versus 32%). Even so, the difference isn’t enough to adequately manage these risks, nor to warrant the confidence.
What you can do
- Embrace agility over certainty. Today’s geopolitical environment can’t be navigated with old playbooks. Consider how you can develop “seamanship” — the ability to steer through complexity using experience, intuition and real-time judgment without having all the information. Implement a real-time scenario framework to help navigate geopolitical and country-specific risks.
- Build influence through collaboration and external insight. Don’t go it alone. Plug into cross-functional strategy early, develop relationships with government and external advisors and expand your access to timely, relevant intelligence. Participate in major initiatives at the strategy and design stages, when risk insights can help inform smarter decisions that could mean the difference between success and failure.
- Focus on the relativity of risks. Risk quantification only gets you so far. What really helps business leaders is seeing how risks compare — what’s urgent, what can wait and where the real exposure is.
- Develop a long-term strategy. Use risk as an opportunity to strategically plan ahead. That means focusing on long-term goals, not just what’s in front of you today, and providing insights that set the business up for lasting success.
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About the survey
Our latest PwC Pulse Survey, fielded May 1 to May 8, 2025, surveyed 678 executives and board members from Fortune 1000 and private companies about the current business environment, the risks executives are facing and their company’s strategic plans and priorities. Of the respondent pool, 82 were risk leaders.
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