Article
January 17, 2025
By Michael Hartt
The Geopolitical Shift Facing Business Leaders
The days of the ‘Davos man’, the billionaire business leader leveraging the rules-based, international capitalist system for gain defined in Peter Goodman’s 2023 book, seem numbered. With geopolitical disruption reshaping the world, he will soon be replaced by the ‘corporate diplomat’, a new breed of executive – gender irrelevant – who needs a deft touch and different strategic approach to manage the forces out of their control.
The 2025 Davos agenda includes catalyzing growth amid geopolitical shocks, investing in people and supporting the energy transition. But topics on CEOs’ minds are far broader. International security and conflict. Populist and nationalist movements. Protectionism and trade barriers. The climate crisis’s human and economic impacts. Radical technology disruption.
The issues are complex and nuanced. So is the cast of protagonists and antagonists that need to be addressed by the corporate diplomat, a concept introduced by Deloitte in 2024. It is not always clear which ones are friend or foe.
The landscape is being shaped by a surge of influence from new powers and alliances, including many of the most markets that are most attractive for investment as Western economies stagnate. But these new powers may not be beholden to the rules-based system the Davos man knows well. Navigating and negotiating between business and political leaders operating to different standards becomes a test of diplomatic skill and communication capabilities that may be unfamiliar to the CEO and C-suite members.
Simultaneously, the divergence among traditional allies presents growing risk for business leaders.
The gulf on climate action between the Trump administration and the EU and UK will create strain around investment and transparency. Different approaches to technology regulation versus enablement may complicate decisions on scaling AI usage or leveraging data. And the challenge of securing Chinese investment while managing the potential perceived threat of China’s security and economic agenda will be more difficult, given the White House’s likely demands and expectations of U.S. allies regarding China.
For the corporate diplomat, effective communication is key to success.
Messages on business strategy, corporate values and operational choices will face more scrutiny, needing more care to ensure consistency and cultural sensitivity when delivered across markets.
Companies will need to incorporate a wider range of stakeholders’ views in decisions, requiring a better understanding of non-American or non-Western perspectives to reflect their full supply chain or sales footprint.
Stronger relationships with stakeholders will be vital. Politicians, partners, employees or customers in far-flung markets – particularly for companies operating with a “U.S.” and “rest of world” mentality – will be more influential, requiring them to be embraced by the corporate diplomat, not just managed.
Finally, leaders must brace for new levels of transparency about business decisions, relationships and impact that may be uncomfortable or disruptive. Beyond regulations like the EU’s Corporate Sustainability Reporting Directive (CSRD), multinational companies may face greater exposure to domestic political dynamics, media scrutiny and societal expectations around the world. They will all add complications to the CEO’s efforts to drive business growth.
The Davos man may struggle to adapt to this new environment. But the corporate diplomat will see the opportunity for business growth and will rise to the occasion, at forums like Davos and in their work every day around the world.
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