Export controls, sanctions, and fractured supply chains are forcing CIOs and CTOs to think like geopolitical strategists.

A Risk Super-Cycle That Refuses to End

For much of the 2010s, geopolitics sat in the “background risk” bucket for most technology and industrial companies. Inflation, interest rates, and competition were the day-to-day worries. Wars and sanctions were something you read about, not something you modeled for your data center or chip roadmap.

That mental model no longer works.

The World Economic Forum’s Global Risks Report 2025 lists escalating conflicts, great-power rivalry, and a breakdown in global cooperation among the most pressing short-term threats, noting that perceptions of worsening conflict now top the concerns of political and business leaders. World Economic Forum S&P Global similarly warns that geopolitical risks—from war in Ukraine and the Middle East to tensions in East Asia—are directly shaping the global outlook for growth, inflation, and supply chains. S&P Global

Boards are taking notice. A 2025 memo highlighted by Harvard’s corporate governance forum reports that geopolitical risk has become the leading concern for CEOs, with ISS Governance warning that the world may be entering a “geopolitical risk supercycle” after decades of relative stability. Harvard Law Forum on Governance

For technology-intensive companies, that supercycle shows up in very specific ways: export bans on advanced chips, sudden sanctions on counterparties, license requirements for shipping tools across borders, and government scrutiny of who controls data centers and rare-earth supply chains. The result is a world where architecture diagrams and market maps must be drawn with political risk in mind.

Export Controls: From Niche Rules to Market-Shaping Instruments

No area better illustrates the fusion of geopolitics and technology than export controls on advanced semiconductors and AI infrastructure.

A McKinsey analysis published in April 2025 describes how proliferating export restrictions are “reshaping markets,” expanding far beyond traditional military goods into semiconductors, quantum technologies, and even software that embeds strong encryption. The authors note that since 2019 the United States has more than doubled the number of restricted foreign buyers, while the European Union has begun requiring companies to police where key industrial goods ultimately end up, particularly in Russia and Belarus. McKinsey & Company

The goal is often framed as economic security: preserving technological leads while limiting adversaries’ access to critical tools. The reality is more complex. A report from the U.S. Congressional Research Service and a separate study by CSIS show that tightening U.S. and allied controls on advanced chips and lithography tools has certainly constrained some Chinese capabilities, but has also triggered a massive state-backed push for domestic chip innovation and alternative supply chains. Congress.gov

The policy is now being recalibrated on the fly. In August 2025, Nvidia and AMD agreed to pay 15 percent of their revenue from certain advanced chip sales to China to the U.S. government in exchange for export licenses, a controversial deal that partially unwinds earlier outright bans and effectively converts export control into a kind of revenue-sharing regime. Analysts warn that arrangements like this can undermine the credibility of controls and create new business uncertainties. The Guardian

On the other side of the Pacific, China has not stayed still. It passed a comprehensive Export Control Law in 2020 and has since used it to restrict shipments of strategic minerals and critical materials for chip manufacturing, and, more recently, to limit foreign access to sensitive data and AI infrastructure. McKinsey & Company In November 2025, Reuters reported that Beijing moved to ban foreign AI chips from state-funded data centers, tightening control over whose hardware runs core digital infrastructure even as grey-market channels continue to leak banned U.S. chips into the country. Reuters

For cloud providers, chipmakers, and AI platforms, these control wars are no longer a distant policy debate. They directly affect where they build data centers, whom they can sell to, how they design products, and what portion of their global revenue is at risk of becoming un-exportable overnight.

Sanctions and Energy: Volatility as the New Normal

Alongside export controls, sanctions have become a primary foreign-policy lever—and a major operational headache.

The Atlantic Council’s Energy Sanctions Dashboard estimates that sanctions on Russian, Iranian, and Venezuelan oil have removed millions of barrels per day from official markets over the past decade, with much of that volume redirected through “shadow fleets” and ship-to-ship transfers into China. Atlantic Council A November 2025 sanctions update by law firm Steptoe notes that the U.S., UK, and EU have recently intensified restrictions on Russian energy firms and entities linked to Iran’s oil trade, including certain Chinese refiners and shipping companies, further complicating global energy logistics. Steptoe

Financial market commentary now talks openly about a sanctions-induced “financial split,” where Western measures against Russia have failed to cause collapse but have accelerated the rise of alternative payment networks and de-dollarization initiatives. An analysis by Oanda points out that the sanctions regime is pushing sanctioned states to develop increasingly sophisticated evasion networks, drawing on patterns pioneered by Iran and North Korea. OANDA

Technology companies are caught in the middle. Cloud and software providers must constantly update restricted-party screening and geofencing to avoid servicing sanctioned entities, even unintentionally. Energy tech, industrial software, and telecom players face the risk that long-standing clients in “grey zone” jurisdictions could suddenly appear on a new round of sanctions lists, forcing abrupt contract terminations and write-downs.

The message from recent enforcement updates is that regulators now view cybersecurity, data protection, and sanctions compliance as intertwined. Firms that use cross-border cloud, data lakes, or AI analytics on operational technology must be able to prove that sensitive data and services do not flow to sanctioned entities, even via indirect channels.

Supply Chains and “Friend-Shoring”: Designing for Fragmentation

Geopolitical volatility is reshaping the physical and digital supply chains that underlie the technology industry.

A 2025 report by the Council on Foreign Relations on U.S. economic security warns that debates in Congress now routinely consider restrictions on procurement of semiconductors and AI services from China, not just exports to China. The report notes that AI data centers, rare-earths, and other less visible parts of the AI supply chain may present systemic vulnerabilities that are only beginning to be addressed. Council on Foreign Relations

In parallel, the U.S. administration has moved to tighten control over tool shipments to Chinese fabs. In September 2025, the Financial Times reported that the Commerce Department revoked Taiwan Semiconductor Manufacturing Company’s license-free ability to ship U.S. chipmaking tools to China, forcing TSMC’s Nanjing subsidiary to seek case-by-case approvals. Similar moves have targeted Korean memory giants, underscoring that export rules now reach deep into the globalized chip ecosystem. Financial Times

Companies are responding with a mix of diversification and “friend-shoring,” adding capacity in jurisdictions seen as politically aligned and building redundancy into critical supplier networks. McKinsey’s export-control study notes that many CEOs are now mapping exposure not just by cost and capacity but also by regulatory regime, asking where a sudden control would be most damaging and what backup arrangements exist. McKinsey & Company

This logic extends to cloud and data as well. Hyperscalers and SaaS providers increasingly design region-specific stacks for sensitive sectors, keeping certain data and workloads within the EU, the U.S., or other trusted jurisdictions to reduce the risk that sudden geopolitical shifts or data-localization rules will disrupt operations.

Real-Time Geopolitics: Dashboards, Scenarios, and Boardroom Attention

One of the more striking developments in 2025 has been the professionalization of corporate geopolitical analysis.

BlackRock’s Geopolitical Risk Indicator (BGRI) tracks market attention to a set of top global risks, offering real-time signals about when markets are pricing in higher geopolitical stress. BlackRock KPMG’s 2025 “Top Risks Forecast” similarly frames geopolitical fragmentation as a structural condition, not a passing phase, urging organizations to treat risk analysis as a strategic asset rather than a compliance chore. KPMG

The Harvard corporate governance forum has argued that boards must move beyond “surface-level conversations” and integrate geopolitical risk into the mandates of audit, risk, and strategy committees, potentially through dedicated task forces. It points to survey data showing that directors see geopolitics as a top concern but often lack clear frameworks for action. Harvard Law Forum on Governance

In practice, leading firms are beginning to tie geopolitical indicators directly into operational dashboards. For example, a spike in tensions may automatically trigger a review of export-control exposure, re-routing of critical shipments, or restrictions on new sales in affected regions. Others are incorporating scenario planning into capital expenditure decisions, asking how a data-center build or fab investment would fare under various tariff, sanctions, or conflict scenarios.

The common thread is that geopolitics is no longer treated as unpredictable background noise. It is being quantified, modeled, and embedded into routine decision-making in a way that would have seemed excessive a decade ago.

Living with Uncertainty: From Reactive to Proactive Postures

None of this means that companies can forecast every policy shock or conflict flare-up. The World Economic Forum’s Global Risks Report is explicit that the combination of conflict, economic headwinds, and disinformation makes precise prediction nearly impossible; the task is to build resilience, not clairvoyance. World Economic Forum

What is changing in 2026 is the default stance. Instead of treating trade rules, sanctions, and export controls as static givens, technology-intensive companies are designing their architectures, contracts, and governance structures for a world where rules shift mid-game. That includes more modular supply chains, region-aware data architectures, robust compliance and sanctions-screening systems, and senior-level oversight of geopolitical exposure.

There is also a growing recognition that volatility creates opportunity as well as risk. Analysis highlighted by Harvard’s governance forum points out that “new neutrals”—countries that have managed to avoid taking hard sides—are attracting disproportionate investment from firms looking for relative stability. Harvard Law Forum on Governance Others argue that companies that can pivot quickly—reorienting supply, talent, and capital as conditions change—will find themselves better placed than slower rivals when the next shock hits.

The underlying message is straightforward, even if the implementation is not. Geopolitics now belongs on the same dashboard as uptime, churn, and cash flow for technology-driven enterprises. The organizations that treat it as a core design parameter, rather than a periodic crisis, will be the ones most likely to keep shipping products, training models, and servicing customers when the world around them suddenly changes again.

References

Global Risks Report 2025
World Economic Forum
https://www.weforum.org/publications/global-risks-report-2025/

Restricted: How Export Controls Are Reshaping Markets
McKinsey & Company
https://www.mckinsey.com/capabilities/geopolitics/our-insights/restricted-how-export-controls-are-reshaping-markets

The Governance of Geopolitical Risk in 2025
Harvard Law School Forum on Corporate Governance
https://corpgov.law.harvard.edu/2025/03/25/the-governance-of-geopolitical-risk-in-2025/

Geopolitical Risk Dashboard
BlackRock Investment Institute
https://www.blackrock.com/corporate/insights/blackrock-investment-institute/interactive-charts/geopolitical-risk-dashboard

Energy Sanctions Dashboard
Atlantic Council
https://www.atlanticcouncil.org/energy-sanctions-dashboard/

Author: Serge Boudreaux – AI Hardware Technologies, Montreal, Quebec
Co-Editor: Peter Jonathan Wilcheck – Miami, Florida

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