Evolving Risks Blog
September 27, 2012 by Joshua Wallace
A video mocking the Prophet Muhammad, released by an American filmmaker, is instrumental in the death of an American Ambassador in Libya. A cartoon in a French weekly, also mocking Muhammad engenders protests in Kabul and the lockdown of French embassies in 20 countries. The connections between the causes and outcomes seem tenuous – even audacious. Certainly they do not seem proportionate.
August 6, 2012 by Joshua Wallace
Resource nationalism, like other components of economic protectionism, has receded since the institutionalization of the Washington consensus and the gradual – if unsteady – democratisation of the developing world. The days of aggressive expropriation, the seizing of private assets by governments, are empirically in decline. Governments, as The Economist point out, are increasingly open to foreign involvement in heavy extraction industries as they seek to exploit the technical, infrastructural, employment and foreign currency advantages of foreign ownership.
July 25, 2012 by Joshua Wallace
‘Black Swans turn Grey’
The risk landscape is undoubtedly shifting. PwC (PricewaterhouseCoopers), invoking Nassim Nicholas Taleb’s recent book, posit that ‘Black Swans’ are increasingly ‘turning grey’. By this, they mean that previously catalytic and unforeseen events are becoming more regular; betraying an increased level of uncertainty faced by the global community in the face of growing connectivity and dependency.
Their approach is to expand existing ERM (Enterprise Risk Management) frameworks ‘by innovating around them, adding tools and techniques such as scenario modelling, predictive indicators and ‘reverse stress-testing’. PwC is right to identify a changing terrain, in which political developments play an increasingly important role, however traditional approaches to Political Risk themselves must adjust to remain relevant in the 21st century.