#1
Corporations Further Move from DEI
McDonald's has announced a rollback of certain diversity, equity, and inclusion (DEI) initiatives, aligning with a broader trend among U.S. companies reassessing such programs. The fast-food giant is retiring its goal to have 35% of its U.S. leadership roles filled by individuals from underrepresented groups by 2025 and is ending requirements for suppliers to commit to DEI principles. This decision follows pressure from conservative activists advocating for corporate neutrality and comes in the wake of the 2023 Supreme Court ruling that deemed affirmative action in university admissions unconstitutional. Other major corporations, including Walmart, Ford, and Lowe's, have similarly scaled back their DEI efforts, citing legal risks and shifting political landscapes. Following the 2020 death of George Floyd, there was a notable increase in initiatives aimed at improving DEI within companies. However, recent data indicates a decline in these efforts. For instance, the proportion of new black directors at Russell 3000 companies decreased from 26% in 2022 to 12% in 2024, while the percentage of new white directors rose to 69%. This shift is attributed to conservative backlash, including litigation and other pressures, leading companies to deprioritize DEI policies. The incoming Trump administration may further influence the momentum of these initiatives. Corporations will need to be concerned with this issue due to reputation warfare where perceived political decisions will harm business operations. See here for Insight Forward research on the subject and how it will impact corporations.

#2
Russia Threatens European Critical Infrastructure
Recent incidents of undersea cable sabotage in the Baltic Sea highlight escalating risks to critical infrastructure, particularly energy supplies. The cutting of telecommunication cables, linked to suspicious Russian and Chinese-owned vessels, poses a growing threat to Norway’s and Europe’s energy security. Norway, now the EU's largest natural gas supplier, relies heavily on electricity cables to power its offshore oil and gas platforms, part of its transition to renewable energy. Norway's shift to electrifying offshore platforms, a move expected to halve carbon emissions from oil and gas fields by 2030, involves building extensive undersea cable networks. However, these cables are increasingly targeted, potentially enabling adversaries like Russia to disrupt Europe’s energy supply. Recent incidents, including a shadow tanker implicated in Christmas Day sabotage, illustrate how vessels may covertly damage infrastructure before moving on, exploiting legal ambiguities under international maritime law. While Norway’s existing gas turbines provide backup power, sabotage risks complicate its ambitions to lead in offshore wind energy. Clean wind power installations, like the world’s largest floating wind farm, will also require secure electricity connections. Norway is boosting surveillance with its Navy and Coast Guard, but the potential for further disruption remains high, underscoring the need for vigilance across Europe. Corporations may also need to prepare for the possibility of temporary outages as geopolitical tensions increasingly spill into critical infrastructure domains.

#3
U.S. Sanctions Chinese Corporation Over Cyberattack
The U.S. Treasury Department has imposed sanctions on Beijing-based cybersecurity firm Integrity Technology Group, also known as Yongxin Zhicheng, for its alleged involvement in cyberattacks targeting U.S. critical infrastructure. The company is accused of supporting the Chinese state-sponsored hacking group "Flax Typhoon," which has compromised numerous devices globally, including in the United States. These sanctions freeze Integrity Technology's U.S. assets and prohibit American entities from conducting business with the firm. This action is part of a broader U.S. strategy to counter cyber threats from Chinese entities. In September 2024, the FBI disrupted a botnet controlled by Flax Typhoon, which had infected over 260,000 devices, including IoT hardware like cameras and storage devices. FBI Director Christopher Wray noted that about half of these compromised devices were located in the United States. The sanctions against Integrity Technology underscore the escalating tensions between the U.S. and China over cybersecurity issues. In addition, this event highlights how multinational corporations can and will be caught up in the geopolitical competition. This will set the precedent for other countries to sanction U.S. and Western corporations as well, increasing political risks.

#4
Canadian PM Trudeau to Resign
Canadian Prime Minister Justin Trudeau announced his resignation as leader of the Liberal Party and prime minister, ending nearly a decade at the helm of Canadian politics. Trudeau cited internal party challenges and declining public support as factors behind his decision, emphasizing the need for a stronger leader to face the next election, expected by October 2025. His resignation triggers a leadership contest within the Liberal Party, with speculation about interim or permanent successors, including Finance Minister Dominic LeBlanc and former Bank of Canada Governor Mark Carney.

The announcement comes amid significant challenges for the Liberal Party. Public support has plummeted due to Canada’s housing crisis, economic concerns, and rising tensions with the U.S. Conservative leader Pierre Poilievre currently holds a commanding 24-point lead in polls, giving the Conservatives a near-certain chance of securing a parliamentary majority if elections were held today. Trudeau's departure marks a pivotal moment in Canadian politics as the country prepares for new leadership and potential shifts in governance, especially one that will be more amenable to working with the Trump administration. Trump’s threatened tariffs could devastate the Canadian economy, so a prime minister willing to work with Trump could ultimately help business operations in Canada over the next four years.

#5
Austria Far-Right Party Allowed to Form Government
Austrian President Alexander Van der Bellen has tasked Herbert Kickl, leader of the anti-immigrant Freedom Party (FPO), with forming a new government. Initially, in October 2024, Van der Bellen granted the mandate to then-Chancellor Karl Nehammer, as major political parties refused to cooperate with the Russia-friendly FPO, despite its parliamentary election victory in September. However, the political stance has shifted. Nehammer resigned after failing to secure a coalition deal, and the new leader of the conservative Austrian People’s Party announced that the party would now engage in talks with the FPO. This development moves Austria closer to forming its first far-right-led government since World War II, reflecting the broader rise of populist leaders across Europe. Austria does not play a major geopolitical role in European security, but if the FPO can form a government, then this will likely become a test case for other European countries that have so far been hesitant to include right-wing parties in governance, such as Germany, France, Spain, Netherlands, and others. As such, the FPO forming a government will be an indicator of a further shift in European politics.

#6
Global Oil Exports Decline in 2024
Global crude exports fell by 2% in 2024, marking the first decline since the COVID-19 pandemic. Weak demand growth, refinery shifts, and geopolitical conflicts, including the wars in Ukraine and the Middle East, disrupted trade routes and reshaped global oil flows. Middle Eastern exports to Europe dropped sharply, replaced by increased U.S. and South American supplies. Russian oil, previously sent to Europe, was redirected to India and China, strengthening alliances between Russia, India, and China. U.S. oil exports reached record highs, solidifying the country’s position as a major global supplier. Changing demand patterns are also reshaping the market. China and Europe experienced reduced imports due to weaker demand, growing renewable energy adoption, and government mandates to reduce carbon emissions. Escalating Middle East conflicts and potential sanctions under U.S. President-elect Donald Trump further tightened supply, raising prices and pushing refiners toward alternative sources like West Africa and Brazil. New refining capacities in the Middle East, Mexico, and Asia are expected to absorb more regional oil production, while proposed U.S. tariffs on Canadian and Mexican crude could significantly alter trade flows in 2025. There is highly likely to be continued uncertainty and volatility, with long-term demand growth no longer assured, signaling a new normal for global oil markets.

#7
Houthis Undeterred by U.S. Strategy
The U.S. strategy to deter and degrade the Houthis has proven ineffective, as evidenced by their sustained attacks on Israel and Red Sea shipping lanes in late 2024. Despite U.S. retaliatory strikes and multinational operations like Operation Poseidon Archer, the Houthis remain emboldened, with their operations escalating and their influence expanding beyond Yemen. Their capabilities have been strengthened by alliances with groups like al-Shabab and support from Iran, Russia, and illicit trade networks. The Houthis’ resilience, combined with minimal material dependence on their population, enables them to sustain operations against U.S. and allied forces. Their ability to disrupt global shipping, attack regional oil infrastructure, and launch hundreds of missile and drone strikes highlights their growing regional and global threat. Due to this, multinational corporations should expect continued disruptions to shipping and the supply chain. Terrorism is likely to expand more generally in 2025, and the Houthis will continue to be a major problem for businesses.

#8
Washington State Sues T-Mobile Over Cyberattack
Washington state has filed a consumer protection lawsuit against T-Mobile, alleging that the company's longstanding cybersecurity deficiencies led to a 2021 data breach compromising the personal information of over 2 million state residents. The breach exposed sensitive data, including Social Security numbers, phone numbers, names, addresses, and driver's license information, putting affected individuals at risk of identity theft and fraud. Attorney General Bob Ferguson asserts that T-Mobile was aware of its security vulnerabilities for years but failed to address them adequately. The lawsuit also claims that T-Mobile misled customers by professing a commitment to data security while neglecting necessary safeguards. Furthermore, the company allegedly provided insufficient notifications to affected customers, omitting critical details about the compromised information. The lawsuit seeks civil penalties and a court order mandating T-Mobile to further strengthen its cybersecurity protocols to prevent future breaches. This is an indicator that governments will start imposing punitive measures for cyberattacks and data breaches, but with the lack of cybersecurity protections, they will target corporations through trade and consumer protection laws instead.