Corporate boards face new geopolitical risk …

Corporate boards face new geopolitical risk challenges in a shifting global order

The text discusses the evolving role of corporations in addressing geopolitical risks and the need for adaptation in corporate governance. It draws parallels to the early days of corporations, which were chartered by states to implement public policy and produce public goods, challenging the current market-driven paradigms. The text highlights the uncertainty surrounding ESG issues and the broad domestic support for compelling corporations to address global security threats and maintain international order. The text raises questions about the preparedness of corporate boards in an era of deglobalization, noting a gap between geopolitical uncertainty as a risk priority and the resources dedicated to addressing it. It points out that few corporations have mandated disclosure requirements for managing geopolitical risks, and there is a lack of clarity on oversight responsibilities within organizations. The text emphasizes the increasing importance of geopolitical risk management in seeking judicial remedies, as directors and officers may be held liable for failing to monitor mission critical risks. It also highlights the need for companies to address reputational resilience by clarifying their interactions with geopolitically sensitive issues and markets. In summary, the text calls for corporations to adapt to the changing landscape of geopolitical risks and to reassess their governance structures and risk management strategies. It suggests that corporations should prioritize geopolitical risk management, clarify oversight responsibilities, and address reputational resilience to navigate the challenges of an era of deglobalization.

Source: canadianlawyermag.com
Published on 2024-09-21

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