Business faces the challenges of ‘operating in polarized society’

Increased political violence and unexpected oscillations in government policy have resulted in political polarization soaring throughout the world.

According to the Political Risk Index by the Professional Service Company Willis, who examined more than 200 countries, affective polarization was at the highest historical point, with the fastest growth in democracy such as the US, Germany, India, Brazil and Bulgaria.

The report found that in democracy, the polarization surge tends to follow the economic crisis or corruption scandal, which seems to discredit traditional political leaders.

This surge is often accompanied by the growth of populist political movements and increasing the frequency of political violence events.

This report also includes ideological polarization, which refers to the extent to which people approve the problem of core policy, and elite polarization, the extent to which political rivals consider each other legally.

We as outliers

This finding reveals that the US is the only state globally where affective, ideological and elite polarization has all increased quickly over the past 15 years.

One of the “most striking characters” comes from questions about marriage, which appears repeatedly in some US polls.

The report quoted data from 1960, showing that around 5 percent of US voters would not be happy if their child married someone from other political parties. However, in 2016, the figure has increased above 60 percent of the supporters of the two political parties.

However, regardless of high record rates in the US, polarization and populism increased in Europe and the world that emerged besides the US.

Sam Wilkin, Director of Political Risk Analysis in Willis, explained that “Business faces challenges that are developing from operating in an increasingly polarized community.”

As he explained, “Polarization is also felt on a more personal basis, like how we look at our friends and colleagues.”

This happened after Willis’s survey of the global business last month found that most respondents (almost 40 percent) said they had experienced a negative financial impact of conflict in the Middle East – in most cases, due to supply chain disorders.

While the US policy is highlighted as a driver of political risk after almost 60 percent said they expect the trade conflict of President Trump’s government to have a negative impact on their finances.

On April 2, Trump’s announcement of his global tariff resulted in the most cruel surprise to the international financial markets since Pandemi Covid-19, with each closed shares of the week in Red.