Family businesses in the global storm: Keys to navigating the new geopolitics

This article is part of the Newsletter #1 from the Chair in Family-Owned Enterprises (CFOE) at Esade and Andbank. Subscribe here.

In recent years, the global business environment has grown considerably more complex, shaped by shifting interstate dynamics and evolving relationships between governments and markets. The result is a world in which resilience —rather than efficiency alone— has become the central strategic priority for companies, including family businesses. 

Interstate relations: From order to competition

The post–Cold War era was marked by a relatively stable international order, supported by multilateral institutions and the leadership of the United States. Today, that framework is unraveling. The US—once the main architect and guarantor of international institutions—is now actively dismantling or disregarding them. Allies and rivals alike watch in disbelief as the US retreats and undergoes political fragmentation, while an unfamiliar new order begins to take shape. 

At the same time, the US is undergoing profound internal transformation: a revolution in political norms, social cohesion, and its strategic vision. This turmoil at the core of the global order has given way to more intense geopolitical competition with China, as regional powers pivot among multiple fronts. 

Today, the priority is not just efficiency, but the ability to withstand and adapt to uncertainty

One of the current casualties of this disorder is the fight against climate change—a truly global challenge requiring collective action, precisely the kind of coordinated response today’s geopolitics fails to deliver. Ironically, in this unstable context, Europe could emerge as a bastion of relative stability. If it succeeds in maintaining political and economic unity, the European Union could become an anchor for global business—a zone of predictability in an unpredictable world. 

Government–market relations: The return of the state

Alongside geopolitical shifts, the role of the state in the economy is also being redefined. The market, once seen as an end in itself, has now been subordinated to other political priorities. In the pursuit of security, social cohesion, or strategic capabilities, governments are increasingly intervening in the economy—redirecting capital flows, shaping supply chains, and favoring strategic industries over market logic. 

State power is back: governments now shape supply chains and prioritize strategic industries over market forces

This resurgence of state power has costs and implications for business. The previous focus on efficiency and globalization has been replaced by goals such as national security, social stability, and industrial sovereignty. These changes are not temporary reactions to a crisis, but part of a broader redefinition of the role of markets in society. 

Implications for global business: Resilience over optimization

The conclusion for global businesses is clear: operating internationally has become much more difficult. Supply chains are more vulnerable, regulatory frameworks more fragmented, and political risk more pervasive. Business leaders can no longer assume a stable and predictable environment. 

In this new era, resilience is the key. Companies must rethink risk management, diversify their sourcing, and build redundancies that would previously have been seen as inefficient. Flexibility, adaptability, and strategic foresight are now essential assets. 

The global business environment is no longer defined by open markets and predictable institutions. Instead, it is shaped by political instability, strategic rivalry, and an urgent need to withstand shocks. In this reality, the most successful companies will be those that embrace complexity, anticipate volatility, and invest in their capacity for resilience. 

Strategic geopolitical management in business

At Esade, through the Center for Corporate Governance and EsadeGeo, we have proposed a model to help boards of directors manage geopolitical risks strategically. We recommend three steps to help companies incorporate geopolitics into the board agenda: 

1. Geopolitical analysis

Ongoing training for directors and senior executives is key to developing sustained awareness of geopolitical trends. Leaders must be prepared to interpret both local and global regulations as well as major legal changes. Boards lacking this preparation will be at a disadvantage in identifying risks and opportunities, and will struggle to build trust across the organization. 

2. Strengthening connections 

The public and private sectors can no longer operate in isolation. In such an interconnected world, the entire value chain is linked to national security. Universities, research centers, and think tanks provide vital knowledge. Organizations must foster these relationships to implement up-to-date intelligence and ensure knowledge transfer. Today, national security depends on strong cooperation between civil, private, and social networks. 

3. Risk management and opportunity identification 

Technology and innovation races among companies, industries, and countries are becoming increasingly intense. In this context, national and international bodies are creating regulatory frameworks to keep pace with change—frameworks with enormous economic impact. Proactivity is essential: boards must develop forward-looking strategies that integrate national and global factors and are flexible enough to adapt. 

In an uncertain and ever-changing world, security—and business survival—depends on the ability to adapt to these emerging geopolitical challenges. 

The power of resilience

How can family businesses navigate this environment? In fact, family businesses have a major competitive advantage in this regard, because they are resilient. Many long-standing family enterprises have survived wars, economic crises, or pandemics. 

Family businesses often have various resource redundancies, such as talent—frequently motivated by a commitment to provide employment for as many people as possible—or immediate financial resources (that may be financially inefficient). Their conservative mindset helps them prepare for potential crises while enabling agility and innovation in growth. They often maintain underused capacity with future growth in mind, supported by a long-term vision that allows them to sacrifice short-term returns for long-term gain. 

Finally, the business families behind these companies typically instill their values into the organization, with a strong desire for continuity and stability. This helps balance out a highly volatile environment—provided they are flexible enough to adapt to change without losing their essence.