The coffee rose. The steel descended. The tariffs came. The risk increased. This sequence looks like a challenged samba, but it is, in fact, the tragic chorus of the current commercial tension between Brazil and the United States. More critical than the critical metals who have also become the center of discussions. At a time when bilateral relations are shaken by tariffs and veiled threats of retaliation spread across the backstage, what is at stake goes far beyond exports.
The United States opened a commercial investigation against Brazil under section 301 of Trade Act and imposed up to 50% tariffs on strategic products. In response, and. As if the economic tension were not enough, the clash also advanced to the legal field. Invoking Magnitsky Law, which authorizes sanctions against individuals accused of serious human rights violations, the US, alleging abuse of power and improper restrictions on freedom of expression. The measure had immediate side effects: Brazilian financial institutions, afraid of infringing international regulations, began to block transactions and credit cards linked to the minister.
Diplomacy has become a regulatory crossroads. Companies, banks and investors are in the middle of the board, trying to reconcile commercial interests with legal obligations that now cross borders and challenge traditional risk models. It is in this scenario that the areas of Corporate Governance, Risk Management and Compliance (GRC) enter as a task force to understand, respond and especially anticipate the effects of each of the scenarios that unfolds. It is not enough to react. We need to redesign strategies, review assumptions and ensure that decision making follows being based on data, not scare.
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Is geopolitical instability the new normal?
For multinationals, Map-Map is no longer a strategy board and became a minefield. What was once a “country” risk became a “week” risk. A sanction there, a fare there, a speech crossed in an international forum, and that’s it: business plans saw marked cards. The borders, once only logistics, today are also political, economic and reputational.
With globalization and advancement of foreign direct investment, doing business is no longer just an economic choice. It has also become a geopolitical decision. Negotiating with one country can mean, directly or indirectly, to be barred in another. What happens on the other side of the world may not immediately impact its headquarters, but it may compromise strategic suppliers, delay deliveries or make entire commercial routes unfeasible.
In this scenario, corporate governance and risk management must abandon any illusion of neutrality or permanent stability. International investors, often at a different risk appetite from local stakeholders, require specific reports, additional mitigation measures, and rapidly replaced responses. No global operation is governed without considering external volatilities as part of the business. Geopolitical risk is not a “black swan”. In the middle of 2025, it is everywhere, all the time, impuning in all our strategic spreadsheets.
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In theory, external factors such as political instability, trade war or diplomatic disputes should be integrated into risk management models. But in practice, they are still treated by many companies like footnotes in the risk maps: those generic mentions that are there, quiet, until they become headlines. The consequence? Surprise, disorganization, improvised decisions and an emergency meetings with apocalyptic names such as “War Room”, “Crisis Committee” and “Intercontinental Containment Plan”.
The effective GRC cannot afford to be an adjunct in this scenario, let alone a policy reviewer hidden behind the legal or quality area. It needs to act as a convergence point between macro and micro, between diplomatic and logistics, between international discourse and cost spreadsheet. It is the GRC who helps objectively translate, which means, for example, a new fare on inputs, the blocking of a commercial zone, the more rigorous Due Diligence requirement to maintain an international partner or the need to suspend customer or suppliers due to sanctions imposed by international laws such as the magnistky law. In this context, GRC is no longer supported and becomes strategy.
Route adjustment such as routine and transparency as armor
More than identifying risks, it is up to GRC to build answers. Inform in advance, suggest realistic alternatives and accurately communicate the potential impact of each geopolitical movement. And, especially, keep the executives, the board and investors supplied with solid analyzes, preventing surprises from coming to panic.
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In volatile times, the GRC that delivers value is one that offers direction when winds change. And even under storm, keeps the ship (the business) sailing with governance. Risk models cannot be decorative parts in annual reports. Beautiful heat maps in PowerPoint did not unlock a logistics chain stuck in customs. Continuity plans based on static assumptions do not serve in times of trade war. And growth goals that ignore geopolitical impacts do not attract investors.
In this new context, continuous review of premises and operational routes is not a sign of weakness, but of maturity. The company that understands that the global scenario changes from one quarter to another (or from one tweet to the other) is the surviving. What’s more, it can anticipate movements, protect assets, maintain strategic institutional relationships, and preserve value even in the midst of chaos.
But it is not enough to act. It is necessary to communicate. In times of high volatility, transparency becomes one of the most valuable assets of an organization. Shareholders, councils, regulatory agencies and even employees themselves expect (and require) visibility on the risks assumed, the paths evaluated and the ongoing measures. Because, in the end, what differentiates a resilient company from an exposed company is not the size of the storm, but the quality of the compass. And in the midst of this crossing, the GR supports the business by protecting the present and preparing the future. Outside the box, but within the strategy.
