Geopolitical risks may arise from political, economic, or social instability in a country or region, driven by government actions, international relations, conflicts, or regulatory changes. These risks can negatively affect business operations, investments, supply chains, and financial performance. Events such as wars, sanctions, trade disputes, regime changes, terrorism, or shifts in international alliances can trigger such risks. For risk professionals, geopolitical risks warrant ongoing monitoring because they can cause sudden changes in market conditions, regulatory environments, or the physical security of assets and personnel.

AXA XL defines it broadly and undertakes thorough, expanded analysis to ground a client-centric view.