When Black Swans Aren’t: Geopolitical Risk Management

Date/Time
Date(s) - 06/22/17
11:30 am - 4:30 pm

Location
DePaul University Loop

Hosted by
DePaul University


Thu, June 22, 2017 11:30 AM – 4:30 PM

The past year has seen many seemingly unexpected events come to pass, from Brexit to the United States Presidential Election. The upheaval has continued into 2017: the rise of the National Front and Marine Le Pen in the French Election; the growing fractures in long-standing international alliances like NATO, NAFTA, and the European Union; and the wave of autocracy, nationalism, and populist retrenchment in the face of globalization.

However, are we witnessing a series of “black swan” events? Could we see any of this coming? What types of models and practices can be used to identify and absorb the myriad financial, strategic, political, and operational risks associated with the current global upheaval and the realities of the twin, competing forces of populism and globalization?

We’ll begin with a keynote dialogue between two recognized experts in the field: Professor Guntram Werther of Temple University and Professor Tom Mockaitis of DePaul University.

Following the keynote discussion will be two panels of experts from the financial, insurance, political science, and macro-global fields that explore the current geopolitical risk climate. We’ll discuss the effects and ramifications of globalization, the global wave of retrenchment and nationalism, and the changing nature of borders and failed states. How can companies properly manage geopolitical risk–whether through mitigation, avoidance, or transference–present in the world today?

 

Agenda


 

11:30 pm Boxed Lunch

12:15 pm Keynote Dialogue: When Black Swans Aren’t

Professor Guntram Werther of Temple University and Professor Tom Mockaitis of DePaul University will discuss where we’ve been, where we are, and where we’re headed in the current geopolitical risk landscape while addressing the idea of “black swan” events.

 

1:30 pm Forward to the Past: Globalization, Retrenchment, and Returning to a Pre-WWI World

By some experts’ estimation, we have now entered the fifth wave of globalization and the world is feeling its effects—both positive and negative. While globalization has a strong economic benefit for some, it can have an equally strong negative consequence for others. The rise of populism, nationalism, and rapid retrenchment can be seen as a backlash against this globalist wave. As if in defiant response to the “end of history” declarations in the 1990’s, the world continues to be reshaped in seemingly unexpected ways. Longstanding international alliances like NATO, NAFTA, and the European Union now are on shakier footing.

Similarly, the ascent of energy technology and the possibility of American independence from foreign oil couple with a resurgence of a “Fortress America” mindset has long-ranging ramifications on the current international order. The world, remarkably, seems to be retreating to a shape similar to how it looked before World War I.

Our panel of experts will discuss the current trends in globalization, nationalism, and retrenchment—and how to factor these trends into a robust geopolitical risk management framework. What do you need to know and how can you appropriately address these risk factors whether through mitigation, avoidance, transference, or acceptance? Can these risks be priced? How can you translate this knowledge into action?

 

3:00 pm The Changing Nature of Borders and Failed States

The fifth wave of globalization has also changed the nature of borders: while porous to goods, borders remain only semipermeable to labor. However, conflict and poor economic situations have increased immigration, migration, and refugee travel. This has led to an inflection point between economic (and cultural) protectionism and the drive (and overall benefit) towards open borders and free trade. Coupled with the uncertainty of new—or the possible retreat from existing—trade agreements, the risks associated with investing or conducting business in a particular country can sometimes be hard to pinpoint.

Alongside these risk factors is the looming potential of a failed state. What happens when the state in which you are conducting business collapses, whether due to civil war, economic ruin, or environmental catastrophe (earthquake, epidemic, etc.)? Can you address (or presage) this possibility in your risk management framework? Outside of a completely failed state, the rise of authoritarianism presents similar risk factors: what effect does an uncertain legal or financial system of the host country have on any contracts or business?

Our panel of experts will discuss these topics through the lens of several case studies, from the Middle East to South America to Africa. How have companies addressed these issues in the past? What worked then? What might not work now? How can you assess (and price) these risks?

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4:30 pm Reception

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