Prepared by
Michelle Thomson, QRD®, Chair
Florence Anglès, Vice-Chair
Contributors
DCRO Emerging Topics Subcommittee: Joy Albright; Chukwunomnso Anyichie,
QRD®; Cesar Chalhoub; Aku Odinkemelu; Brian Prentice; Mai Shuaibi; David Streliski; Benson Uwheru, Secretary.
Originally developed through the DCRO Emerging Topics Subcommittee.
Submitted to Club Turgot | July 2026.
Geopolitical crises do not stay where they start. What begins as a regional event spreads rapidly through commodity markets, supply chains, financial systems, regulation and corporate strategy. For boards, the defining challenge is not the initial shock — it is recognising how quickly its consequences migrate across the organisation before any single committee has seen the whole picture. Geopolitical crises have become a permanent feature of the global business environment. They rarely remain confined to their point of origin. What begins as a regional event can quickly spread through commodity markets, supply chains, financial systems, regulation and corporate strategy. For boards, the defining challenge is not the initial shock itself but recognising how rapidly its consequences migrate across the organisation.
The paper shows that the principal governance challenge is recognition rather than prediction. Boards oversee risk through specialised committees, each performing its mandate effectively. During systemic crises, however, information becomes fragmented. Every committee sees part of the problem; none sees the complete picture. By the time directors assemble an integrated view, cross-silo contagion is often already underway. This structural weakness is described as the Governance Illusion.
Drawing on the 1956 Suez Crisis, the 1973 OAPEC Oil Embargo, the 1979 Iranian Revolution and the 2022 Russian invasion of Ukraine, the paper identifies a recurring pattern: geopolitical disruption, energy shock, supply-chain disruption, inflation, tighter financial conditions, sovereign stress and long-term structural adjustment. Across all four events, the common governance failure was delayed recognition rather than lack of information. Three analytical tools support earlier recognition. The Potential Cross-Silo Contagion Pathways helps directors anticipate how risks migrate across business functions. The Committee Lag Map explains why committees receive signals at different moments, delaying enterprise-wide understanding.
The Asymmetry Map identifies the regions and structural conditions where contagion is most likely to emerge first, enabling boards to focus on leading rather than lagging indicators. Each tool is presented as a visual framework in the full paper.
The historical evidence also highlights three recurring governance failures: concentrating on immediate impacts while overlooking second- and third-order effects; assuming geographically distant crises will remain contained; and underestimating how individually manageable risks interact to create systemic disruption. These structural weaknesses are reinforced by behavioural biases including confirmation bias, threat rigidity and bounded rationality.
Recommendations
Three recommendations emerge. First, establish an Integration Function capable of consolidating information across board committees into a coherent view of systemic risk. Second, appoint a Designated Challenger responsible for questioning prevailing assumptions, exploring alternative scenarios and ensuring weak signals receive appropriate attention. Third, complement these structural changes with behavioural discipline through regular cross-committee dialogue, explicit consideration of second-order effects and continued vigilance during periods of apparent stabilisation.
Geopolitical shocks cannot be prevented, but governance failures can. Boards that integrate information, challenge assumptions and recognise cross-silo contagion early will be better positioned to protect long-term value and strengthen organisational resilience in an increasingly interconnected world. The full paper, including the analytical frameworks and historical case analyses, is available at