Boards will have to go through the “big adjustment” of switching from a management approach based on “optimisation” to one of “pragmatic optimism” that focuses on resilience, if they are to manage through the current disruption caused by geopolitics.

Tina Fordham (pictured), Wall Street’s first political consultant and founder of Fordham Global Foresight, made the remarks during an interview for Board Agenda’s Governance Watch podcast.

Fordham is in the process of publishing a new book focused on the ways boards and governance must adapt to deal with the new international order.

She says boards must get past their “denialism”—believing geopolitics will return to its previous state—and change their approach.

“The first step is acknowledge that the lens that we use has moved away from, let’s call it optimisation—just in time, supply chain, P&L, lowest cost—to resilience.

“It’s a big management buzzword, but resilience means durability, stability and higher prices.

“It’s going to be more expensive, and that really goes against what most board leaders have been taught and have practised during the course of their careers. It’s a big adjustment.”

A decade-long ‘super cycle’ of change

Fordham caught the attention of big business earlier this year with a report, Never Going Back to Normal, which presented evidence that geopolitical events have been increasing and that the international order is caught in a “super cycle” that has been under way for a decade.

The recent publication of the US national security strategy emphasised further White House divergence from Europe and its belief that mass migration will undermine the European Union.

Fordham believes coping with the current changes means business leaders must “stress test plausible hypotheticals”, and “even think the unthinkable”.

“Now that scares people,” Fordham says. “When I say these things to an audience, I can see the fear in people’s eyes, and you just can’t react that way.

“As board leaders, we have to anticipate…a wider bandwidth of possible change.”

She adds: “What I think we can’t afford to do is that ‘Let’s wait for the dust to settle’ instinct that I see time and again.

“I like to quote Louis Pasteur: ‘Fortune favours the brave, chance favours the prepared mind’.

“If you don’t like to engage with these kinds of themes, how can you recognise an opportunity?”

This podcast was produced in association with NASDAQ Governance Solutions.

You can watch the full interview below or listen to the full episode on Spotify , Apple and all major podcast platforms.