For decades, technology companies had the luxury of treating politicals risks as an afterthought. But now, in 2021, the technology sector has found itself in the crosshairs of government regulators worldwide and becoming increasingly exposed to political threats, according to a new white paper from Willis Towers Watson. The "Managing the New Political Risks in the Technology Sector" white paper highlights how the COVID-19 pandemic has caused a shift toward economic nationalism that, along with EU technology regulation, is threatening technology supply chains and IP. "If 'data is the new oil,' as the saying goes, might Big Tech be the new Big Oil? Today, it appears that competition for dominance in high technology may become central to geostrategic competition, just as oil did from the 1850s to present," Laura Burns, U.S. political risk product leader, financial solutions at Willis, wrote in the white paper. "And as these Big Tech companies operate, increasingly they may collide with the geopolitical objectives of Host Countries and Home Countries. The technology sector will continue to develop and adapt, but its ability to work in a volatile business environment is critical, as the last year has shown." |

Mitigating new risks

Wills Towers Watson commissioned Oxford Analytica to survey a panel of technology executives in the U.S. and Europe about the factors creating growth in technology companies seeking political risk insurance, as well as the top geopolitical threats for the industry in 2021. Discover these threats in the slideshow above. According to the experts, political risks have shaped technology operations in recent years. One panelist explained how "everyone owns political risk" at their company, as the threats impact everything from cybersecurity to operational functions. Another executive highlighted that role-playing scenarios that address emerging threats are now an annual exercise given increased political volatility. Additionally, the COVID-19 pandemic and trade disputes that emerged in 2020 disrupted technology companies' supply chains, explained Fredrik Motzfeldt, GB industry leader for technology, media and telecommunications, in the white paper. "Rising political risk is at the top of executives' list of concerns with companies feeling increased pressures in areas such as access to talent (including work visa restrictions), regulation of intellectual property, and in political challenges to alleged dominant market positions and ownership structures," he added To find out more about emerging political risks in the technology sector, download Willis Towers Watson's full white paper here. Related: |

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