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| Phil Denning |
As we enter 2025, the corporate communications landscape has become increasingly complex, volatile and fraught with new and unprecedented challenges. The intersection of technological disruption, geopolitical tensions, social dynamics and rapid regulatory changes has created a perfect storm of potential crisis scenarios that corporations and their leaders need to be prepared for.
Companies aren’t just evaluated on their financial performance or product quality but on their ability to demonstrate ethical leadership, social responsibility and adaptability in the face of multifaceted challenges. The new administration’s policies, emerging technological risks, heightened social expectations and global economic uncertainties present a wide range of potential issues and crisis scenarios for companies.
AI and technological ethical challenges
Rapid advances in artificial intelligence through the growing accessibility to AI tools present unique risks for companies. With AI becoming increasingly integrated into corporate operations, companies will potentially face new risks. As companies have attempted to leverage AI tools to streamline seemingly mundane tasks, they have found themselves facing new risks such as algorithmic bias and discrimination. Integrating AI can help reduce the cost of completing tasks such as a lender using AI-powered loan applications or an HR department using AI-driven hiring tools.
However, if not trained properly, these tools could put a company at the center of a crisis by perpetuating discriminatory lending practices or discriminating against candidates based on race, age and disability in violation of federal and state anti-discrimination laws.
| This article is featured in O'Dwyer's Jan. '25 Special Issue on Crisis Communications |
AI policies and regulations will continue to evolve with a focus on industry guidelines and standards, with a continued focus on cybersecurity, privacy and national security at the center.
Organizations must develop robust communication strategies that demonstrate responsible AI implementation, showcase human-centric approaches and proactively address potential ethical concerns before they escalate into full-blown crises.
Implications and risks of a new presidential administration
The new Trump administration is generally expected to push for deregulation across various sectors to lighten the regulatory load on businesses. While many believe the reduced scrutiny will present opportunities, there are also potential risks.
For example, the Consumer Financial Protection Bureau is expected to see curtailed rulemaking activity and rescission of many Biden-era policy statements. As federal oversight decreases, states may intensify their own enforcement activities, creating a complex regulatory landscape for companies operating across multiple jurisdictions.
Established companies may face increased competition. Fewer regulatory hurdles may stimulate competition and innovation, potentially leading to reduced costs for consumers, but it can also potentially create a more challenging business environment for established companies as new entrants find it easier to enter markets.
Wall Street anticipates a potential bounce in corporate dealmaking if the new administration brings lower interest rates and looser regulatory scrutiny. However, a more favorable M&A environment might encourage more unsolicited or hostile takeover attempts, as companies seek to capitalize on reduced regulatory obstacles.
The transition to the Trump administration presents significant risks for companies due to regulatory uncertainty and potential policy shifts. Potential restructuring or elimination of regulatory agencies may disrupt established compliance frameworks. These challenges and potential risks will vary from industry to industry.
Companies must remain agile in their communication strategies and develop clear crisis communication plans to address both internal and external stakeholders, ensuring they can quickly adapt to new regulatory landscapes while maintaining transparency and stakeholder trust.
A growing anti-ESG movement
As we enter 2025, the corporate governance and Environmental, Social and Governance landscape has become increasingly complex over the years, with heightened stakeholder expectations, regulatory pressures and global challenges driving unprecedented scrutiny of corporate behavior. However, a new risk is emerging through an anti-ESG movement.
According to proxy advisor firm ISS’s recent analysis of shareholder proposals—U.S. Shareholder Proposals: A Decade in Motion—there’s a significant rise in anti-ESG efforts, however “Investors show little to no interest in proposals that advocate a political viewpoint without demonstrable economic relevance.”
The anti-ESG movement presents a critical challenge for corporate leadership in 2025, a landscape characterized by political polarization, shifting regulatory environments and conflicting stakeholder expectations. CEOs must develop a sophisticated approach that balances principled leadership with strategic communication and organizational resilience.
Companies must transform ESG from a potential liability into a strategic opportunity, demonstrating that sustainable business practices are fundamentally about creating long-term value, driving innovation and maintaining competitive advantage. The challenge will be to articulate clear economic rationale for ESG initiatives not as a political statement, but as a business strategy that delivers measurable results.
A minefield of conflicts and social issues
In 2025, companies will likely face mounting pressure to navigate the increasingly complex and volatile landscape of geopolitical uncertainty, coupled with the heightened risks associated with taking public stances on social or political issues. As we’ve seen in recent years, businesses are no longer immune from the impact of global conflicts or societal movements. The blurring of the lines between business, politics and social justice presents a unique challenge for corporate leaders who must balance the interests of stakeholders, employees, customers and shareholders, all while maintaining corporate reputation.
Geopolitical instability presents significant risks to companies operating on the international stage. In 2025, organizations with global operations will continue to feel the effects of these tensions, whether through disruption of supply chains, sanctions, changing trade policies or direct calls for boycotts or divestment from specific regions. Corporate leaders must prepare for the fallout from not only how such conflicts affect their bottom lines but also how their public positions on these issues may alienate customers and investors.
Many companies will find themselves under intense pressure to take a stance on conflicts, wars and social issues as the intersection of business and politics has become increasingly pronounced. Companies may face compliance and ethical dilemmas when navigating sanctions or managing supply chains in politically sensitive areas. Each industry and each business may face different risks and challenges associated with geopolitical events.
Corporate leaders are now expected to have a voice on political or social issues, especially those that have broad societal implications. However, expressing opinions on such issues can also open the door to backlash from different sides of the debate, leading to reputational risks, consumer boycotts and employee unrest.
Navigating the future with foresight
In 2025, the risks of geopolitical instability and the complexities of taking a public stance on sensitive social or political issues will continue to be prominent in the corporate landscape. Business leaders must recognize that their companies’ decisions in these areas have the potential to create significant reputational risk, impacting everything from consumer loyalty to employee morale and shareholder confidence.
A successful crisis communications strategy will require companies to carefully consider the long-term implications of their public positions, weigh the diverse interests of global stakeholders and ensure that their corporate values align with their actions. Transparency, authenticity and consistency will be key in navigating this increasingly polarized and unpredictable world. The companies that manage to strike the right balance between their corporate missions, values and the demands of their stakeholders will emerge not only as resilient organizations but also as influential voices in shaping the future of business leadership.
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Phil Denning is a Partner at ICR.
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