What has become increasingly clear is that a responsive, reactive approach to political risk management is only a second best way to deal with political risk. A much more promising approach is it to deal with political risk in a proactive, strategic, and comprehensive manner. It has therefore become essential for businesses to thoroughly examine how political risks could compromise market access, supply chains, production processes, financial bases, human resources or corporate governance. What has turned out to be increasingly useful is to maintain a corporate-wide perspective of political and wider economic and market risks in form of a political and economic risk register. A political and economic risk register enables them to develop a political risk hierarchy, more strategically allocate resources, build a system of controls, and increase overall resilience.
In order to learn more about how to establish and maintain a political and economic risk register, please contact us.