As concerns over global policy uncertainty reached a 20-year peak in 2025, BCG is warning that the issue must be a core business capability, with dedicated teams.
Business leaders cite trade reconfiguration, weakening multilateral institutions, and the weaponisation of economic tools as persistent threats to business continuity and competitiveness.
However, a report by the IMD Business School and the World Economic Forum, in collaboration with Boston Consulting Group (BCG), found that, as geopolitical disruption becomes a defining feature, fewer than 20 per cent of companies have created a dedicated geopolitics department.
This comes as Lloyd’s of London warned that a potential geopolitical conflict could devastate the global economy, triggering $14.5 trillion (£11.89 trillion) in losses over the next five years.
With the recent tensions following President Trump’s shock operation to capture Venezuelan dictator Nicolas Maduro, investors’ nerves have been put on edge.
Geopolitical topics are rising up the corporate agenda, and most firms remain in a reactive posture, treating geopolitics episodically.
Geopolitics ‘not just an issue for diplomats’
“Too many companies treat geopolitics as a headline issue rather than a business capability,” said Nikolaus Lang, global leader of the BCG Henderson Institute, chair of BCG’s center for geopolitics, and coauthor of the report.
He warned that the current system “is no longer sustainable”.
The report, which comes ahead of the World Economic Forum’s annual meeting in Davos, noted that the usefulness of emerging AI tools for geopolitical sensing “remains limited”.
The report also highlighted that there is no single blueprint for mainstreaming geopolitics.
As more than half of the companies interviewed locate their geopolitical capability within government or corporate affairs, firms pursue different operating models such as task forces, senior advisers, and full-time dedicated teams.
“Geopolitics isn’t just for diplomats. It needs to be a top priority for business leaders,” said Simon Evenett, professor of geopolitics and strategy at IMD Business School and co-author of the report.