Boards can expect their oversight and corporate governance processes to be put to the test in 2025 as companies face unprecedented disruption and uncertainty. Ongoing global issues such as the war in Ukraine, rising trade tensions, and inflation risks will increase the complexity of managing business risks. In Nigeria, challenges related to high inflation, cybersecurity, security, climate change will also pose significant risks.
In this volatile operating environment, we expect continuing scrutiny of board oversight of risks to the company’s operations and strategy. The pressure on management, boards, and governance will continue to be significant.
Based on insights from discussions with directors and business leaders, we highlight ten issues to keep in mind as boards consider and carry out their 2025 agendas:
Maintain focus on how management is addressing the risks and opportunities related to geopolitical and economic shifts and global disruption
Geopolitical and economic risks, combined with the potential for political and social disruption driven by disinformation and cyberattacks, will continue to drive volatility and uncertainty.
At the same time, the ongoing reconfiguration of supply chains is an indicator of a broader pendulum swing that’s reshaping the full-throttle globalisation of recent decades. The transition from “cheaper-faster” strategies enabled by highly complex, decentralized supply chains to a focus on greater, even hyper-localization and control over a company’s networks - suppliers, services, and data/ information - is clearly aimed at enhancing the resilience of the company. However, concerns about the resilience of national economies - and of the global business environment - are also driving the momentum toward more centralized and local supply chains.
National, industrial and security policies are becoming increasingly important. De-risking and friend-shoring, especially in critical sectors such as oil and gas, agriculture, and technology, are being used as strategies to safeguard against geopolitical instability and the potential impact of unpredictable local regulations. This shift is also driven by Nigeria’s efforts to bolster economic resilience and reduce vulnerability to external shocks, including the challenges posed by fluctuating oil prices, security issues, and political uncertainty.
As this globalisation reset unfolds, companies will face pressing questions. Is the company prepared to operate in a higher-cost (of capital, green tech/energy, labour) environment? What is the right balance between operating efficiently, maximizing growth, and ensuring resilience?
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