The milestone reflects a growing recognition across boardrooms worldwide that geopolitical instability — from armed conflicts and trade wars to sanctions and tariff regimes and supply chain fragmentation — presents material financial and reputational risks that demand strategic attention at the highest levels of corporate governance.
Top 7 risks by year
| 2022 | 2023 | 2024 | 2025 | 2026 | |
|---|---|---|---|---|---|
| 1 | Cyber attack | Cyber attack |
Health and safety 84% |
Health and safety 80% |
Health and safety 77% |
| 2 | Data loss | Data loss |
Cyber attack (includes cyber extortion) 79% |
Data loss 77% |
Data loss 76% |
| 3 | Cyber extortion | Cyber extortion |
Data loss 78% |
Cyber attack (includes cyber extortion) 77% |
Cyber attack (includes cyber extortion) 75% |
| 4 | Regulatory breach | Regulatory breach |
Regulatory breach 74% |
Regulatory breach 74% |
Systems and controls 66% |
| 5 | Risk of a health and safety/ environmental prosecutions safety legislation | Health and safety prosecutions |
Systems and controls 73% |
Systems and controls 70% |
Regulatory breach 65% |
| 6 | Your organisation being a victim of crime | Bribery and corruption |
Bribery and corruption 69% |
Civil litigation/ third party claims 63% |
Bribery and corruption 59% |
| 7 | Bribery and corruption | Your organisation being a victim of crime |
Breach of sanctions 64% |
Bribery and corruption 62% |
Geo-political risks 59% |
Source: Global D&O Liability Insurance Survey 2026
This article examines why geopolitical risks are of increasing concern to directors and officers, analyzes the key data from the Global Directors’ and Officers’ Survey Report 2026 to understand how those risks vary by corporation size, region and industry. We also consider what boards should be doing to mitigate and manage the effects of the threats that they face.
Why do directors and officers face a new era of geopolitical volatility?
The past four years have presented an unprecedented cascade of geopolitical disruption.
The war in Ukraine, the escalation of conflict in the Middle East, heightened tensions in the South China Sea, the imposition of sweeping trade tariffs and counter-tariffs and the proliferation of sanctions regimes have combined to create an operating environment characterized by sustained uncertainty, with political events carrying direct and interconnected consequences for multinational businesses, supply chains, contractual obligations and insurance programs.
The Middle East conflict, for example, means companies with operations or counterparties in affected regions face potential property damage, business interruption, loss of access to key shipping routes and the triggering of force majeure clauses in commercial contracts.
The disruption to Red Sea shipping lanes and the Strait of Hormuz forced significant rerouting of global trade, adding cost and delay to supply chains already stretched by post-pandemic recovery. Sanctions arising from such conflicts, where the failure to comply can expose directors and officers to serious personal liability, regulatory enforcement and reputational harm, even if they did so inadvertently.
The Iran-Israel tensions have introduced the prospect of broader regional destabilization, energy price volatility and the potential for cyber attacks on critical infrastructure. These emerging risks have significant insurance implications, as traditional policy wordings for war, terrorism and political violence may not neatly align with the hybrid and evolving nature of modern geopolitical threats.
Policyholders are increasingly being required to scrutinize their coverage, understand the scope of war and sanctions exclusions and ensure their insurance programs keep pace.
At the macroeconomic level, the fragmentation of the global trading order — driven by protectionist tariffs, export controls on critical technologies and taking advance of potential vulnerabilities in modern-day economic interdependence for goods, services and resources — is forcing businesses to rethink long-held assumptions about the stability of international commerce.
Companies that once prioritized efficiency through lean, globalized supply chains are now compelled to build resilience, redundancy and optionality into their operations, often at considerable cost.
How is D&O risk influenced by corporation size?
The Global Directors’ and Officers’ Survey Report 2026 reveals concern about geopolitical and supply chain risks isn't evenly distributed across organizations of different sizes.
Among mid-sized companies with revenues of $50 million to less than $1 billion, geopolitical risks rank sixth at 63%. For larger organizations with revenues of $1 billion to less than $5 billion, supply chain issues rank fifth at 74%, reflecting the particular vulnerability of complex, multi-jurisdictional operations to disruption.
The very largest organizations, those with revenues of $5 billion or more, rank supplier business practices seventh at 77%, underscoring the extent to which large corporates are exposed to risks embedded deep within their supply chains.
Notably, for the smallest organizations — those with revenues below $50 million — neither geopolitical risk nor supply chain issues appear in the top seven, suggesting these risks are most acutely felt by businesses with the greatest international exposure and operational complexity.
Company size
| Less than $50 million | $50 million to less than $1 billion | $1 billion to less than $5 billion | $5 billion or more | |
|---|---|---|---|---|
| Health and safety | 71% | 77% | 86% | 81% |
| Geo-political risks | 41% | 63% | 70% | 77% |
| Supplier business practices | 45% | 58% | 71% | 77% |
| Supply chain issues | 43% | 60% | 74% | 74% |
Source: Global D&O Liability Insurance Survey 2026
How is D&O risk influenced by region?
In Europe (excluding UK), geopolitical risks rank sixth at 55%, a figure likely influenced by the continent's proximity to the conflict in Ukraine and its direct exposure to energy supply disruption, refugee flows and sanctions compliance obligations.
In Africa and the Middle East, supply chain issues feature prominently in the top seven — ranking sixth at 85% and 84% respectively — reflecting the acute vulnerability of these regions to disruptions in global trade routes and commodity flows. While geopolitical risk doesn’t feature in the top seven risks for either Africa or the Middle East, as expected, the risk remains highly ranked for both regions (at 74% and 81% respectively).
Country of office
| Europe | GB | Asia | North America | LatAm | Pacific | Africa | Middle East | |
|---|---|---|---|---|---|---|---|---|
| Health and safety | 72% | 80% | 72% | 80% | 74% | 87% | 85% | 100% |
| Geo-political risks | 55% | 56% | 65% | 64% | 51% | 52% | 74% | 81% |
| Supplier business practices | 49% | 57% | 66% | 65% | 57% | 53% | 81% | 71% |
| Supply chain issues | 49% | 47% | 65% | 67% | 58% | 54% | 85% | 84% |
Source: Global D&O Liability Insurance Survey 2026
In North America, supply chain issues rank seventh at 67%, a figure that reflects both the impact of recent tariff policies and the increasing focus on nearshoring and "friendshoring" strategies.
How is D&O risk influenced by sector?
Supply chain risk ranks particularly highly in sectors with complex physical supply chains and high dependence on the movement of goods. In the industrial sector, supply chain issues rank fifth at 66%, with geopolitical risks also in the top seven at seventh (65%). In the transportation and retail sector, geopolitical risks rank sixth at 67%, and supplier business practices seventh at 63%.
Perhaps surprisingly, the energy and utilities sector shows supply chain issues, down at seventh with 71%, although the high percentage score reflects the sector's exposure to commodity price volatility and the geopolitics of energy security.
In the healthcare sector, supply chain issues also rank seventh at 62%, perhaps a legacy of the pandemic-era shortages of critical medical supplies and pharmaceuticals, an industry reliant on regular and timely transportation of temperature-controlled substances, particularly from manufacturing hubs like India to markets across the globe.
Top 7 risks by industry
| Finance and insurance | Industrial | Healthcare | Services | Transportation and retail | Energy and utilities | |
|---|---|---|---|---|---|---|
| 1 |
Data loss 82% |
Health and safety 82% |
Health and safety 76% |
Data loss 75% |
Health and safety 82% |
Health and safety 89% |
| 2 |
Cyber attack (includes cyber extortion) 82% |
Cyber attack (includes cyber extortion) 80% |
Data loss 74% |
Health and safety 73% |
Cyber attack (includes cyber extortion) 79% |
Data loss 80% |
| 3 |
Systems and controls 77% |
Data loss 76% |
Cyber attack (includes cyber extortion) 67% |
Cyber attack (includes cyber extortion) 72% |
Data loss 75% |
Regulatory breach 77% |
| 4 |
Corporate crimes/ failure to prevent 73% |
Systems and controls 68% |
Board structure composition, independence, diversity 64% |
Systems and controls 60% |
Supply chain issues 68% |
Systems and controls 77% |
| 5 |
Regulatory breach 73% |
Supply chain issues 66% |
Regulatory breach 62% |
Civil litigation-third-party claims 57% |
Regulatory breach 68% |
Cyber attack (includes cyber extortion) 73% |
| 6 |
Health and safety 66% |
Regulatory breach 65% |
Systems and controls 62% |
Regulatory breach 57% |
Geo-political risks 67% |
Bribery and corruption 71% |
| 7 |
Insolvency/ bankruptcy/ financial distress from organisation 65% |
Geo-political risks 65% |
Supply chain issues 62% |
AI/machine learning 56% |
Supplier business practices 63% |
Supply chain issues 71% |
Source: Global D&O Liability Insurance Survey 2026
What is driving this increased focus on geopolitical risk?
Several structural factors explain the trajectory of geopolitical risk from a background concern to a priority for boardrooms.
First, the sheer frequency and confluence of geopolitical crises has increased. Boards are required to navigate a complex, interconnected web of conflicts, sanctions, trade restrictions and political instability occurring across multiple regions concurrently. This has a compounding effect, as disruption in one region can cascade rapidly through global supply chains and financial markets.
Second, the regulatory and legal environment has become markedly more complex. Sanctions regimes are now broader, more granular and more aggressively enforced. Directors and officers face personal liability for sanctions violations, and the pace at which new designations and restrictions are imposed — often with limited lead times — places significant demands on compliance functions. The expansion of sanctions related to Russia, Iran and other jurisdictions has required businesses to undertake continuous, real-time monitoring of their counterparties, supply chains and financial flows.
Third, the rise of economic statecraft — the use of tariffs, export controls, investment screening and forced divestiture as tools of foreign policy — has blurred the traditional boundary between commercial risk and political risk. Decisions that were once primarily commercial in nature (where to source, where to invest, which partners to engage with) now carry significant geopolitical dimensions. In particular, the imposition of tariffs by the United States on a wide range of imports, and the retaliatory measures adopted by trading partners, have introduced a degree of unpredictability into global commerce that's difficult to model and manage.
Are geopolitical risks here to stay as a top concern for directors and officers?
The entry of geopolitical risk into the top seven risks for directors and officers in the Global Directors’ and Officers’ Survey Report 2026 isn't a statistical anomaly; it reflects a fundamentally altered global environment. The data shows that this risk is felt most acutely by larger organizations, by businesses operating in Europe, the Middle East and Africa and by sectors with complex physical supply chains. The interconnection between geopolitical risk and supply chain risk is a defining feature of the current landscape, and boards can't treat these as separate or secondary concerns.
When asked to identify the risks they anticipate facing in the years ahead, respondents to the Global Directors’ and Officers’ Survey Report 2026 ranked geopolitical instability, trade disruption and supply chain risk as their foremost concerns — surpassing even the challenges posed by cyber and data risks, which have ranked consistently in the top three risks for the past five years.
This shift is perhaps unsurprising. The defining feature of today's geopolitical landscape is uncertainty, and it's precisely that uncertainty which makes effective strategic planning so difficult. For boards and senior leadership teams, the challenge lies not only in responding to specific geopolitical events as they arise, but in building the resilience needed to navigate a climate in which the nature and timing of such events remain inherently unpredictable.
Authors
Contact
