Each year, insights from EY leaders across its business are compiled into an annual Board Priorities report, which identifies the key topics on board agendas for the year across Europe, the Middle East, India and Africa. The research highlights challenging areas where boards need to concentrate their attention. Two of the most pressing topics currently are geopolitics and technology.
A) Geopolitics
The geopolitical environment continues to create significant challenges for boards around the globe. Ongoing tensions between major economies, regional conflicts and shifting trade relationships are affecting organizations across sectors and geographies.
Mentions of political risk in corporate reporting skyrocketed by 600% in 2022 and have remained three to four times higher in the past two years. A recent EY survey of 1,000 global executives indicated that 60% of executives point to negative impacts on their companies’ operations and supply chains, and 94% of companies have increased time and resources spent in this area.
Yet despite this, a third of respondents have been surprised by most or all of the political risks that impacted their company over this period, and nearly 80% of them were surprised by at least half of the incidents.Research shows that 76% of boards are acting on geostrategy compared with just 26% in 2021, though only a third have it as a regular main board agenda item.
Boards need to consider how geopolitical developments impact their supply chains, market access and operational resilience. This includes understanding exposure to specific regions, regulatory changes in different jurisdictions and the potential for disruption to international operations.
The EY Reimagining risk for an unpredictable world research found that leaders in geostrategic risk management had five habits in common.
1. They adapt their supply chains to geopolitical realities. We know political risk has a negative impact on operations and supply chains, and two of the top three strategic changes are reconfiguring supply chains and relocating operational assets.The learning here is to assess the risk exposure first – mitigation may only require changing a few things and there is potential value to be had in procurement and other costs.
2. They build political risk analysis into investment decisions. These leaders with expertise in geostratic risk have a stronger appetite for M&A deals and carry through planned transactions at a higher rate, saving time and resources.
3. They prepare for the unexpected. While you might never be able to predict some specific challenges, I certainly believe that boards can do more to build resilience in this area.
There are two actions to highlight:
a. Boards should improve risk identification, monitoring risks on a regular basis and including them in a risk register or similar tool that is shared regularly with the senior executive team.
b. They should systematically explore multiple plausible futures using scenario planning. Two-thirds of leaders already do this proactively to test strategy and then identify actions to mitigate the risks.
4. They keep the topic top of mind. The Reimagining risk for an unpredictable world research found that 76% of boards are assessing the impact of geostrategy or getting regular briefings on it, compared with just 26% in 2021. Only a third have it as a regular main board agenda item; the majority allocate responsibility to an investment committee, while others cover it off in M&A due diligence.
5. They decide who has a seat at the geostrategy table. The most common approach now is inclusive: creating a multi-disciplinary management committee, comprising strategy, operations, risk, compliance, public policy and general counsil, reporting regularly to the board.
B) Technology
Technology also remains a critical area for board attention. The pace of technological change continues to accelerate, creating both opportunities and risks that require governance oversight.
Technology presents opportunities for efficiency and innovation, but also raises concerns around data privacy, decision-making transparency, and workforce impact. Boards need to understand the implications of artificial intelligence adoption, in particular, including questions around implementation, governance, ethical considerations, and competitive positioning.
AI is fundamentally changing how organizations operate and that includes in the boardroom. According to Diligent and Corporate Board Member, 66% of board members use generative AI for board work, with most using it for meeting prep and summarizing documents. However, only 10% use it regularly, and just 2% are not planning to use it. This significant gap between adoption and regular use suggests that boards need to develop more systematic approaches to AI governance and utilization.
Cybersecurity also continues to be a priority, moving from the technology space into multiple areas across the organization. The increasing sophistication of these threats, combined with growing regulatory requirements around data protection, means that boards must ensure appropriate risk management frameworks are in place and actively plan to be one step ahead.
For more detailed insights, including the full EMEIA Board Priorities 2025 report, thinking around Boards of the Future and further resources, please visit the EY Center for Board Matters.
Andrew Hobbs heads up the EMEIA Center for Board Matters at EY, a strategic partner of SelectionF.
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