RESILIENT AND ETHICAL SUPPLY CHAINS
R&C: What are the main supply chain challenges in today’s global business environment?
Rowan: Global supply chains are under immense pressure from geopolitical tensions, inflation and regulatory shifts. The Red Sea crisis, US-China trade restrictions and energy market disruptions are reshaping global trade routes. Businesses that fail to rethink logistics, diversify sourcing and integrate risk intelligence will struggle. For Gulf Cooperation Council (GCC) economies, dependence on imported raw materials and pharmaceuticals is a major risk. Disruptions in the Suez Canal, Hormuz or Bab el-Mandeb could halt operations. Companies must localise where possible, secure alternative suppliers and leverage artificial intelligence (AI)-driven analytics to anticipate disruptions. The era of cost-driven, fragile supply chains is over. Businesses that do not adapt will be caught unprepared when the next crisis unfolds. Resilience is now a competitive advantage, not an afterthought.
Rathke: Predictability is one of the major challenges of our time. For many years after the Cold War ended, geopolitics were generally divorced from trade policy, but now countries, most notably the US, are backing away from this approach. This has resulted in relative chaos with respect to tariffs, which makes it difficult for international companies to plan for procurement, even when planned tariffs are ultimately cancelled or delayed. This has downstream consequences for predicting a company’s sales, cost structure and, ultimately, financial results. You will search far and wide to find any economist who thinks this is productive. On the other hand, so far, most countries seem unified in their desire to eliminate socially negative practices from supply chains – most notably with respect to labour and environmental practices. But implementation of those goals varies between jurisdictions, which makes it difficult to track and plan compliance.
Apr-Jun 2025 Issue
Consilium House Consulting WLL
Squire Patton Boggs