How directors should best approach geopolitical disruptions and unpredictable tariff policies

Geopolitical disruptions from wars to unpredictable tariff policies are presenting managers and directors of companies with a challenging operating environment. Five prominent board members discuss how directors should best approach their role in the current conditions.

Ben Wyatt GAICD (pictured above)

Former WA Treasurer and non-executive director at Woodside Energy and Rio Tinto

You can spend enormous amounts of energy — and if you’re not careful, money — running after day-to-day disruptions without having an understanding of where the trajectory is going. Politics certainly teaches you that. Provided you have a plan and you have confidence in the plan, you can cope with those day-to-day disruptions.

As global companies try to navigate this uncertainty, you need to have a clear-eyed view of which disruption or crisis you need to pay attention to, and what are those that might be more short-term and don’t require the detailed and ongoing focus of the board.

Understanding your scenarios, having a long-term view around how you invest your capital is more important than ever. Although, I say that knowing it’s much harder to get a long-term view around your investment.

It’s having that intense curiosity, understanding your stakeholders, understanding your troops on the ground and again, that long-term perspective. The cycles are pretty extreme at the moment, so you have to have the confidence to stay the course and understand the drivers.

Woodside is a good example. It’s made a large investment decision in Louisiana at a time of uncertainty around the trajectory of net zero to 2050, and around US tariff policy. It had the confidence to make the decision to invest because Woodside knows what it can control. It’s good at constructing and operating LNG facilities. The company can take a long-term view that ultimately the trend is still for American supply of energy to the broader globe and for the demand for gas.

I like to understand my stakeholders well. I like to meet with elected members in government and also people who are close to government, whether they be NFPs or suppliers. Trying to get an understanding from those as close to the impact of your investment decisions as possible, because you get a better sense of what is really going on where your assets actually operate.

Michelle Tredenick OAM FAICD

Non-executive director IAG, First Sentier Investors, Hub24, Urbis and IDP Education; chair IAG risk committee and First Sentier audit and risk committee

Geopolitical risks are now part of the landscape and of the discussions risk committees and boards have, whereas they were potentially a little bit more outside that discussion five or six years ago. To give you an example, I sit on the IDP Education board, which by the nature of its business has had to really understand the settings internationally — particularly with students and immigration policies — to make sense of its strategy. Although you could argue a company does that normally, it’s usually doing it in one particular sector, maybe Europe or the US. Now it’s doing it in all sectors around the world.

Being proactive has always been important, but it’s the particular issues you may be proactive around. For example, I sit on the board of an insurance company. While we don’t have supply chain issues at the moment, we are very proactive about analysing our supply chain, understanding where those risks might emerge and taking steps before it’s necessary to assure ourselves we have contingencies around disruptions. If you’d asked me that question 10 years ago, I don’t think that would’ve been the case.

Many significant risks, geopolitical in nature, are hitting at the same time. It’s about trying to understand the interconnectedness of those. Are they all single risks you can just look at and say, “OK, we’ve got risk number one, and we’re doing something about that?” Or are risk number one and risk number three incredibly interconnected? You actually have to understand that and deal with those risks at the same time.

It’s about being able to understand the strategic context your company and the world are in — to be able to make judgements with confidence around that strategic context, because you’re not just opining on a set of financial accounts or the operational risks of the business.

Frank Cooper AO FAICD

Non-executive director South32 and Wright Prospecting

We’ve had underlying political challenges around the world for quite some time — and the economic uncertainty that comes with that. We’ve now got an overlay of an additional level of uncertainty as a result of the political response in the US. The worst thing we could do would be to get caught up in the emotion of it, because that would put us at risk of making incorrect decisions more so than the vagaries of the circumstances themselves.

I have a level of confidence the world has an ability to find its way through this. In the short term, we’ve seen an impact on demand and prices and issues where supply may come from. This plays into short-term decisions you may make.

For the longer term, where we’re looking at substantive investment, most companies will operate within a risk framework anyway, one in which we can never be confident about pricing even a couple of years out, let alone five or 10 years.

I see companies trying to look through the noise to what they believe the long-term demand and supply trends are. That’s really no different to how business has been done for many years. Companies are probably taking extra time to think through their risk tolerance now, and maybe collating it differently, being more conservative than they may have been before.

COVID focused people on supply chains. Those ramifications of supply chains, which flowed into inflation, have had a huge impact. It’s probably helped us fine-tune our risk thinking. We may have had supply chains on the risk register before, but would have thought it very low risk.

Dr Gillian Miles

Commissioner Infrastructure Australia and director National Heavy Vehicle Regulator

At Infrastructure Australia, we’re conscious of the global uncertainty as we do our job. Infrastructure projects are always affected by big changes globally. Because we’re giving advice to the Commonwealth government for long-term things, we’re conscious of making sure we have a good handle on the international landscape.

Moving fast is another lesson. People are scared of moving fast, because they might make a mistake. My view would be, move fast on some of what you have to do, but test as you go. Don’t try to be 100 per cent perfect before moving forward.

All the boards I’m on are more risk-averse now than they were 12 months to two years ago. The risk profiling is changing inside organisations. That risk normally comes bottom-up in an organisation. You often do it from an operational perspective. Whereas now, it’s the same question — what are the risks to the business? But it’s at a more strategic level. Might we still be here in three years? What is our value to productivity? To decarbonisation? We are actually thinking a little harder around the organisation’s broader contribution.

It’s a healthy shift, because it gets you talking about not just risks and what we do about them, but opportunities for change, for pivoting a business somewhere else. If boards are doing their job with risk assessment before a crisis hits, you can move a lot faster when it happens. You’re not a passive passenger, waiting for stuff to come up from the organisation. You can change the business quicker if you’re already on top of it.

“Many significant risks, geopolitical in nature, are hitting at the same time. It’s about trying to understand the interconnectedness of those.”

Neil Vinson

Private equity investment manager Tanarra Capital, non-executive director Healius

We’re in a “polycrisis” — a convergence of economic, geopolitical, environmental and technological disruption. What you might have once considered in a board paper and called an externality is now front and centre, a core board issue.

In the past, you possibly assumed a stable rules-based global order where you could make longer-term decisions. That assumption is gone. You have to stress test your whole infrastructure. To look under the hood and see what’s going on in your supply chain. To look at your capability, local versus offshore, to ensure you won’t be vulnerable to geopolitical choke points.

Boards must now think like system strategists. It’s not about reacting to one isolated shock, but preparing for effects across multiple domains. In large public companies, I’d expect the conversations to shift from being compliance-driven to strategically anticipatory, with a growing emphasis on having a “pre-mortem”, rather than a post-mortem. Conversations in the boardroom are shifting to ask, “What could blindside us?”

A practical tool we use at Healius is to have shorter board meetings frequently. We have much shorter intervals, much quicker decision-making timeframes and the ability to be flexible.

During COVID, we saw how quickly operations can seize up without having redundant capability — how easily a board can either be a bottleneck or a helpful lifeline. You need directors who aren’t just domain experts, but willing to challenge, learn, absorb new perspectives and update quickly. 

This article first appeared under the headline 'Challenge accepted' in the August 2025 issue of Company Director magazine.