Page 44 - BFSI CHRONICLE 10 th Issue (2nd Annual Issue ) 23062 COPY.indd

BFSI Chronicle, 2 Annual Issue, 10 Edition July 2022
th
nd
Having clear internal and external perspectives incipient stage must have put in place business
before deciding on the market strategy and the continuity and damage control plan to mitigate
focus , would be of immense advantage. The the adverse impacts of this war.
required information may be sourced from
The report titled “The Global Trends 2040”
concerned embassies, international financial
institutions NGOs. Inculcation of appropriate published by National Intelligence Council
has highlighted that international arena would
situational awareness through effective and
strategic liaison with sources possessing key emerge more contested, uncertain and conflict
insight in critical areas will help organisations prone. The emerging power dynamics are likely
to produce a more intensely competitive, volatile
in good stead.
and confrontational geopolitical environment,
Index of Geopolitical Risk reconfiguring multilateralism, and widen the
A monthly Index of geopolitical risk (GPR) has gap between transnational challenges and
been worked out by Fed Reserve to examine its cooperative arrangements to address them.
evolution and determining factors since 1985. In this milieu the risk of geopolitical conflict
The index is updated monthly and is available is likely to escalate. No single state would be
at https://www2.bc.edu/matteo-iacoviello/ in a position to exercise absolute dominance
gpr.htm. Such index facilitates empirical across all regions or domains. Instead, a wider
studies on the significance of geopolitical type of actors will be active and compete for
risks in configuring the macroeconomic and propagating their ideologies, and attaining
financial cycles. This index of GPR is consistent their goals to best sub serve their interest.
over time, and gauge on real time basis ,the The traditional military, economic, and soft
geopolitical risk as perceived by the press, the power will be complemented by expanding
public, global investors, and policy-makers. technological, network, and information
power in the international system. The techno
Conclusion leaders developing these technologies will
Geopolitical space of this globe has been
enjoy greater access to and concentration of the
undergoing a disruptive transformational controlling power elements.
phase in the wake of Russia’s attack on
Ukraine. It has upset the world order that The challenges posed by geopolitical risks are
persisted since the end of the Cold War. Such likely to emerge to be more difficult. In the next
attack waged by nuclear power on a sovereign two decades, competition for global influence
nation is unprecedented in Europe in nearly is likely to reach its highest level since the Cold
80 years. The ramifications of this war would War. Involved economic agents must consider
be worldwide on top of a pandemic which how to harness capabilities without falling
has already significantly impacted the global victim to geopolitically based regulatory or
political, economic, and social trends. The reputational cross fire.
impact would perhaps persist for decades in an
unpredictable manner. Business and countries 1.Board of Governors of the Federal Reserve System
having assets in and business /trade relations International Finance Discussion Papers
with Russia and Ukraine will have to evolve Number 1222 February 2018: Measuring Geopolitical
strategies to mitigate the impacts of this event. Risk: Dario Caldaray ,Matteo Iacovielloz (January 10,
Those who could sense the trouble at the 2018) :

The Institute Of Cost Accountants Of India

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