IoD highlights uncertainty, other risks to watch next year

The Chartered Institute of Directors, Nigeria (CIoD) has highlighted global risks to watch out for next year, emphasising their implications for governance and the business environment.

Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, said the risks include increasing geopolitical uncertainty, which has been perceived as the biggest risk to the global economy.

He stated this at the 2023 yearly dinner and awards by the CIoD, in Lagos, where he spoke on ‘Global Trends in Governance: Adapting to a Changing World’.
He mentioned issues around the Russian/Ukraine war, saying the impacts would continue to impact the economy and trade.

Yusuf said the implications of the deterioration of the conflict would be grave for the global economy.

The economist also mentioned issues affecting the US-China competition and rivalry, which he said have serious implications for global trade given the size of their economies.

According to him, the Israeli and Palestine war has the potential risk of further escalation with huge implications for peace in the region and polarisation of the global economy, as well as sanctions, trade war and nationalisation of assets among others.

Other key risks, Yusuf said include widespread cybercrime, natural disasters, extreme weather conditions, large-scale involuntary migration, food supply crisis, rising inflation, energy supply crisis and climate change crisis.

There would be many instances of tradeoffs between compliance and competitiveness especially in sectors where the barriers to entry are low, he said.

He stressed that the large informal economy, which is outside regulatory radar reinforced the phenomenon.

The CPPE boss said upholding good governance practices in an environment where institutions are weak and where unethical business practices are rewarded presents a major challenge for enthroning good corporate governance.

He noted that the Nigerian economy offers tremendous opportunities for investors, considering the size of its market, demographics, resourcefulness of its entrepreneurs and the abundance of natural resource endowments.

The expert admitted that the current macroeconomic headwinds are profound and that the structural shortcomings are enormous.
According to him, Nigeria has the fundamentals to turn things around and benefit from the current reforms.

The President and Chairman of the Governing Council, CIoD, Tijjani Borodo, said with the world that is in a state of constant changes, shaped by shifting global trends that impact every facet of human lives, there is a collective responsibility on directors, leaders and decision-makers to understand the trends, adapt and lead their organisations effectively.

“The past few years have brought about remarkable shifts in the global business environment. From the rapid advancement of technology to the ongoing social change, from climate change concerns to evolving geopolitical dynamics.
“As leaders in our respective fields, we are tasked with overcoming these changes while upholding the principles of governance and ethical leadership. Our ability to navigate these challenges and seize the opportunities they present will define our success as directors.
“The theme provides ample opportunity to shed more light on the emerging trends that are shaping the future of governance. The ability to anticipate and respond to global trends in governance will define our capacity to lead in a rapidly changing world,” he said.