Impact of Geopolitical Risk

Geopolitical risks can disrupt relationships between companies and third parties. Companies may face the risk that third parties may be restricted in their ability to provide services or process data due to government restrictions or geopolitical tensions. This could result in project delays and operational disruptions.

Third parties located in countries with high geopolitical risk, such as countries experiencing political unrest or economic instability, are at higher risk of cyber attacks. This can put an organization's data at risk, as third parties often have access to an organization's data or some form of disclosure.

Recent research shows that 93% of corporate cybersecurity leaders and 86% of business executives believe that global geopolitical instability is likely to result in a catastrophic cyber attack. This is a cause for concern, as such an event could have serious consequences for the global economy and society as a whole. People are particularly concerned about the impact on business continuity and reputational damage, which are the top cyber risks they face.

In contrast, this group has a deep understanding of the risks associated with geopolitical instability because it is a tangible and immediate threat that is widely reported in the news. As a result, organizations are taking steps to strengthen controls over third parties that have access to their environments and/or data, and are rethinking the countries with which they do business.

Control over third parties

Organizations can strengthen their control over third parties by establishing clear contracts and agreements, monitoring third party activities, and conducting risk assessments. Selecting third parties that are located in countries with low geopolitical risk or that have adequate security measures in place can reduce the risk of geopolitical instability.

Collaboration between organizations and third parties can also help improve security and resilience by sharing information about security risks and developing joint responses.

The research shows that the actions below are being taken by the management of companies to deal with geopolitical risks. Only 9% of respondents see no need to change current policies.

Manage and monitor your digital supply chain

Geopolitical instability can lead to an increased risk of cyber-attacks and other security risks for organizations and third parties. By establishing clear contracts and agreements, monitoring third-party activities, and conducting third-party risk assessments, organizations can mitigate their risks and strengthen control over their third-party management.

RiskStudio is the central location for third party management, so you always have complete visibility and can efficiently manage your responsibilities within the chain. As you add third parties to your business portfolio, our platform can identify potential risks early. We help our users with various insights, such as:

- The relationship and dependencies of third parties in your supply chain

- The third party's country of establishment and geopolitical situation

- The performance of a third party through a cyber score

- Third party company data and details

- Insight into supply chain risk metrics

For more information on our approach to supply chain risk, please visit the product page.