Risk Navigator – A Realigning World Order: The case for strategic readiness
Risk Navigator is Ashurst Risk Advisory’s risk insight series, redefining risk management in an age of accelerating change and disruption, supporting business leaders to navigate uncertainty through expert risk insight, building resilience along the way.
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Instability defines today's world order. The transition from a unipolar to a multipolar world is eroding trust in and reliance upon global institutions, largely established in the post-Second World War era, to promote peace, security, and prosperity. Gradual fragmentation in reliance upon institutions including the United Nations, NATO, and the World Bank has contributed to, and is likely to continue encouraging, the emergence of new power alliances shaped by economic, military, and technological interests, as well as shared threat perceptions and ideological alignment.
Today, no single country asserts dominant power across all axes of geopolitical competition. The 2025 World Peace Index shows that 35 countries are now deemed to have significant influence over another country, up from just 8 in the 1970s, whilst global military expenditure has risen by 36% over the ten years to December 2024. These dynamics underscore the escalating risks associated with intensifying power rivalries and the growing potential for miscalculation between nation-states and their alliances.
This edition of Risk Navigator examines the case for strategic readiness, making the argument that in a world where geopolitical shocks are no longer unexpected, preparedness is not pessimism, it is leadership.
Key Points
- Post-war norms are under severe stress. The rules that underpinned the longest period of relative peace in modern history are being eroded or replaced by new, competing institutional standards, driven by a growing number of influential actors including regional and middle powers.
- Early warning indicators are flashing. The UN's 2024 Global Risk Report found that 34% of member states, business, and academic representatives anticipate a large-scale war in the next 1–7 years, whilst the World Economic Forum's Global Risks Report 2026 cites geoeconomic confrontation as the highest-ranking global risk over the next two years.
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Political leaders are openly warning of conflict. In 2025, UK Prime Minister Starmer announced the UK was moving to "war-fighting readiness", followed by NATO Secretary General Rutte warning European countries to prepare for war "on the scale our grandparents and great-grandparents endured."
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Geopolitical fragmentation presents immediate business risks. For business leaders, these dynamics create tangible risks including disruptions to global supply chains, regulatory divergence, changing trade routes, new tariffs or sanctions, and conflicts in compliance requirements across jurisdictions.
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The onset of war carries sector-specific consequences. Manufacturers may face severe delays in sourcing raw materials; financial institutions could encounter heightened volatility and cyberattacks targeting payment systems; technology firms could face export controls and data residency challenges as digital infrastructure becomes fragmented.
Practical Implications for Organisations
Business leaders should prepare proactively for organisational resilience through structured exercises that test readiness and decision-making under pressure. Effective approaches include tabletop exercises, where teams discuss tactical responses to simulated crises, and red teaming, which involves role-playing crisis situations to identify weaknesses and blind spots in organisational readiness. More advanced methods such as matrix games or simulation-based drills provide pressure-based testing of organisational resilience, enabling leaders to explore multiple potential sources of escalation or disruption.
Scenarios should be realistic and accurately reflect the company's exposure across supply and demand channels, including interconnected operational dependencies, sensitivities to demand shocks, capital and liquidity flows, movements in interest and foreign exchange rates, inflated supply costs, and sudden changes in resource capacity.
By conducting wargaming scenarios today, leaders should set expectations to strengthen early warning indicators, diversify critical supplies, enhance organisational defences against sophisticated cyberattacks, put in place financial contingencies, and improve internal governance systems to promote leadership awareness and organisational preparedness.
