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In brief
Nearly 75% of CEOs are either localizing or have localized some part of their production within the country of sale, according to the September edition of the EY-Parthenon CEO Outlook. Just over half are reorganizing supply chains to serve a particular regional bloc. These strategic shifts demonstrate how geopolitics is fundamentally changing the global operating environment.
We expect geopolitical volatility to persist in 2026. There will be many underlying drivers of these and other developments, but the role of the US in reshaping the global operating environment in 2026 will be highly significant. As China, the EU and other actors react and adapt to this new US posture throughout 2026, while continuing to shape their own agendas, the global operating environment will continue to evolve.
This will pose both challenges and opportunities for organizations around the world, influencing how executives manage risks, govern their organizations and set strategy. As in past years, the 2026 Geostrategic Outlook is designed to enable executives to incorporate geopolitical analysis into the decisions they make about these and other aspects of their business. As explored in the EY-Parthenon Geostrategy in Practice study, companies that do this well improve their resilience to geopolitical volatility and position themselves to gain a competitive advantage.
Geopolitical developments will continue to reshape the global operating environment in profound ways. Looking across all the expected changes, we identify three core themes that will define the geopolitical environment in the year ahead.
First, new rules and norms for doing business will emerge — and old rules and norms will be discarded. Second, the geopolitics of scarcity will solidify. The third theme is a recognition that there will be four key regions in which these geopolitical dynamics play out in 2026. We refer to this as spheres of engagement.
Each of the developments explored in the 2026 Geostrategic Outlook will impact organizations in unique ways and will necessitate specific geostrategic actions to capitalize on the opportunities they present while also mitigating the risks they pose. The type and level of impact will depend on an organization’s sector and geographic footprint and the strategic choices that its executives make. Select the tiles below to find out how leaders across industries can prepare for geopolitical disruption and shape their future with confidence.
The 2026 Geostrategic Outlook is the eighth edition of this annual publication. During these eight years, the multipolar world has solidified in significant ways. Geopolitical relations have become more conflictual and government policies have focused more on national security goals rather than purely economic ones. Amid the year-to-year volatility; day-to-day volatility, a few consistent trends stand out. The most prominent trend is governments’ continued efforts to improve their economic security or economic sovereignty, including de-risking and onshoring supply chains for critical products and strategic sectors. It is no surprise that operations and supply chains have consistently been the functional area most impacted by geopolitics in recent years – a trend we expect to continue in 2026.
Explore Geostrategic Outlooks from previous years
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Top 10 geopolitical developments for 2024
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How to shift strategy for a new geostrategic era in 2023
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