Clifford Chance

In the first of a series of podcasts on boardroom actions and attitudes to risk, as featured in our 'View from the top' study commissioned in partnership with the Economist Intelligence Unit, Matthew Newick, Global Head of Litigation and Dispute Resolution, speaks to Peter Harris, Counsel, about how political volatility is now business as usual, and how political risk looks set to rise on the corporate agenda in the near future.

With more than half of the respondents of the study expecting political risk to become more important in two years' time, Peter shares his thoughts from his experience advising in relation to disputes between investors and governments, as well as on mega energy and resources projects. Political risk covers a range of risks which essentially arise from the possible actions of at least one government. While the classic examples are nationalisation events, political risks can also take other forms, including civil unrest to industrial action; acts of war; sudden regulatory change or politically motivated trade restrictions.

Boards must manage and mitigate this political risk to remain competitive – this means enhanced levels of due diligence, diversification and dexterity to prevent financial losses or reputational damage.