The US and Israeli airstrikes on Iran are the latest sign of a growing erosion of the liberal rules-based global order. Norms that once loosely governed international behaviour – sovereignty, multilateralism and the rule of law – are in some areas no longer even superficially respected. The trend, contributing to heightened geopolitical volatility, has significant implications for the way global businesses assess and mitigate risks.
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Traditional models of risk management, based on historical continuity and institutional predictability, are no longer sufficient. Strategic assumptions that once underpinned planning – stable global supply chains, coherent regulatory frameworks and rule-based arbitration – must now be rethought or abandoned entirely. These assumptions are simply not as reliable as they once were.
Decision-makers are now finding themselves facing very difficult operational environments largely because sovereign self-interest is often outweighing adherence to international norms. Major powers increasingly act unilaterally over security and trade. Regional conflicts spill across borders. Proxy wars exploit the emergence of effective, well-funded non-state actors. And weaponised interdependence (states exploiting global economic ties for their own advantage) is replacing cooperative globalisation. All of which has complicated and destabilised the international business landscape. Operational and business continuity risks abound across developed and emerging markets.
Emergence of unilateralism
Rather than working through multilateral institutions or alliances, some powerful states are pursuing their strategic objectives alone, bypassing global consensus or shared norms when those no longer suit their interests.
This is exemplified by both America’s decision to join Israel in striking Iran’s nuclear facilities and unilateral sanctions regimes imposed by both the US and China. The US and Israeli strikes, seemingly without meaningful coordination with other Western allies, underscored a shift toward strategic self-interest and demonstrated a willing to use hard power in the pursuit of high-level deals with America’s adversaries. Similarly, unilateral sanctions on China’s semiconductor sector (and China’s countermeasures against Western firms) are being pursued outside of any agreed multilateral trade framework.
Conflicts spreading across frontiers
Conflicts that begin as localised disputes are no longer contained; they spill into neighbouring regions, disrupt global systems, and draw in external powers – intentionally or otherwise. The war in Ukraine has gone far beyond a territorial conflict between two states. It has destabilised regional energy markets, drawn NATO members into a sustained military and financial support role, triggered global food insecurity due to blockaded grain exports, and spurred a rearmament race across Europe. Another example is the ongoing conflict in Sudan, which has begun to destabilise neighbouring states like Chad and South Sudan, threatening to regionalise the crisis.
Rise of weaponised interdependence
States are turning economic interdependence – once viewed as a source of stability – into a tool of coercion and strategic leverage. Trade, technology, finance, and supply chains are now instruments of geopolitical power.
China’s rare earths exports have been used as a pressure point in disputes with the US, Japan and others, while US export controls on advanced chips and semiconductor manufacturing equipment are explicitly designed to curtail China’s technological development. In both cases, mutual economic ties are no longer seen as peace-promoting, but as vulnerabilities to be exploited or insulated against. The global scramble to de-risk supply chains – especially in tech and critical minerals – is a direct result of this shift.
Factors behind unilateralism
The growing disregard for international treaties, legal frameworks and conventions – many in place since the end of the Second World War – has been in large part fuelled by democratic backsliding and authoritarianism. This has been driven by factors such as economic stagnation and recession, mass migration and the weakening of civil society and independent media. It has led increasingly to unaccountable leaders adopting narrow, self-serving agendas aimed at maintaining power and projecting strength. Global governance and security institutions have at the same time struggled to keep them in check, as their own authority wanes.
How forecasting needs to adapt
In this new period of international volatility, geopolitical analysis needs to focus on forward-looking anticipatory assessments that identify and describe a range of possible disruptive eventualities, including reasonable worst-case scenarios. Early warning indicators for tracking and monitoring the latter, along with possible mitigations, should also be developed. Companies are thus provided the intelligence they need to make decisions confidently, as they are fully aware and prepared for all conceivable threats to their operations. It’s a marked departure from the standard analytical approach of examining the probability, and crafting contingencies for a single ‘most likely’ outcome, which has, on the whole, served corporations well for decades. It is no longer adequate, however, because the world is a lot less predictable.
Making the future more familiar
Of course, organisations will have to agree on their risk appetite and tolerance, but being able to plan and prepare for situations that would have perhaps seemed implausible just a few years ago facilitates timely, effective decision-making. In a sense, it makes the future more familiar than it would otherwise be, allowing companies to operate agilely in terms of threat identification, thus gaining a commercial edge over less proactive competitors. So, translating strategic foresight into practice gives decision-makers a clear indication about when to enter and exit markets, diversify supply chains or undertake mergers and acquisitions.
Shift in organisational thinking
This approach to geopolitical analysis necessitates important shifts in organisational thinking, for which there are several key pre-requisites. There needs to be an acceptance by decision-makers that volatility is not a deviation from normal but the new baseline. They must also have the ability to act before a crisis hits rather than after. And critically, as mentioned at the start of this piece, there must be a willingness to reconsider or even set aside increasingly outdated assumptions that have been central to forecasting for so long. Namely, that states and institutions act responsibly and predictably to uphold a rules-based international order.
For global organisations, this shift in mindset might involve developing multidisciplinary teams that combine geopolitical expertise, data analytics, behavioural insight, and crisis management. Then, embedding these foresight capabilities at the core of strategic functions – not as isolated risk exercises, but as continuous, integrated decision-support mechanisms. In other words, ensuring that geopolitical teams work closely with decision-makers, not merely called upon to make long-term forecasts or provide advice when crises break.
Essentially, this amounts to mainstreaming geopolitical analysis within organisations. But this shift in organisational thinking is less about being able to forecast potential challenges with precision than having the agility, intelligence, and strategic depth to navigate them as they unfold.
Author Bio
Matt Ince is an Associate Director at Dragonfly, a geopolitical and security intelligence firm. Within this role, he guides strategic intelligence activities and is the managing editor of Strategic Outlook, Dragonfly’s flagship annual intelligence estimate on geostrategic risks. Matt is also an Associate Fellow at the Royal United Services Institute (RUSI). Prior to joining Dragonfly in January 2023, he spent almost a decade working within the UK’s national security community, leading analysis on emerging global risks.
