Podcast Summary: Is Business Broken?
Episode: Are Boardrooms Ready for the New Geopolitical Reality?
Date: November 20, 2025
Host: Kurt Nickisch
Guests:
- Ruth Aguilera Brodsky (Trustee Professor, Corporate Governance, Northeastern University)
- Kevin McGovern (President, New England Chapter, National Association of Corporate Directors)
- Roy Shapira (Professor of Law, Reichman University; Visiting Fellow at BU Questrom)
Episode Overview
This episode delves into the rapidly shifting landscape for corporate boardrooms amid escalating geopolitical tensions. With the old playbook of global integration and efficiency upended by trade wars, regulatory upheaval, supply chain shocks, and mounting social expectations, boards face a new normal. The discussion centers on how directors must recognize, prepare for, and manage geopolitical risks, balancing legal exposure, reputational risk, and the organizational imperative to stay aligned with company values.
Key Discussion Points and Insights
1. The Changing Landscape: What Geopolitics Means for Boards
[01:41 – 03:26]
Ruth Aguilera:
- Defines geopolitics as the intersection of geography and politics shaping business: trade, tariffs, sanctions, talent mobility, and shifts in global value chains.
- Highlights rebalancing of alliances worldwide as a core change.
Kevin McGovern:
- Adds market availability and ease of entry/exit now change rapidly.
- Notes that these changes are happening all at once, putting immense pressure on boards.
Memorable Quote [02:45]:
“It’s what puts us really in the center of the conversation for boards today... all of these issues... availability of talent, markets, supply, all changing within a very short period of time.” — Kevin McGovern
2. Oversight, Risk, and Legal Stakes
[03:26 – 05:33]
Roy Shapira:
- The board is responsible for risk oversight; failures may result in individual liability.
- Uses the Boeing 737 Max example: directors need proactive systems for risk detection—not just passively waiting but ensuring escalation and response.
Memorable Quote [04:16]:
“We don’t expect you to guarantee outcomes... but at least show us that you didn’t ignore this.” — Roy Shapira
3. Crisis Planning: War Room Readiness
[05:33 – 07:58]
Kevin McGovern:
- Many boards are unprepared, lacking practiced crisis management.
- Vital to decide in advance: who’s in charge, who makes decisions, clear messaging to stakeholders.
Ruth Aguilera:
- Stresses the importance of a consistent company message and quickly identifying primary stakeholders to address.
Notable Advice [07:13]:
“Have a very consistent message across the parties and very true to who you are as a company.” — Ruth Aguilera
4. Board Dynamics under Stress
[08:05 – 09:36]
- Poor board dynamics get exposed in crisis (e.g., COVID-19 became a geopolitical crisis overnight).
- Increasing board agendas—cybersecurity, climate, financials—stretch capacity (“board bandwidth”), even with perfect directors.
Quote [08:49]:
“The biggest problem is board bandwidth... you need everything to be perfect just to fit all those huge issues into one agenda.” — Roy Shapira
5. Governance, Fiduciary Duty, and Foreign Policy
[09:36 – 12:15]
Kevin McGovern:
- Boards do not manage the company but must ask about readiness: “Noses in, fingers out”—probe without micromanaging.
Ruth Aguilera:
- Companies must have a clear rationale and consistent message for high-profile geopolitical decisions (e.g., Russia-Ukraine), balancing conflicting pressures.
- Some sectors (semiconductors, AI, energy, defense) are especially geopolitical.
6. Political Engagement, Reputation, and the “Neutrality” Dilemma
[12:15 – 14:04]
Roy Shapira:
- Corporate political engagement extends beyond lobbying to broader stances on societal issues, with potential for consumer/investor or regulatory backlash.
- Some boards aim for “neutrality” by staying grounded in core values, trying to avoid “damned if you do, damned if you don’t” outcomes.
Quote [13:35]:
“Stick to what you are in terms of what is your core business model, what are your values, and try to stay grounded in that.” — Roy Shapira
7. Specialist Directors vs. Board Education
[14:04 – 15:36]
- Debate over adding subject-matter experts (e.g., geopolitical, AI) as directors.
- Potential downsides: “authority bias”—other directors may defer and neglect their responsibility.
- Prefer general board proficiency and external training over narrow expertise.
8. Managing Divergent Global Expectations (ESG & Regulatory Differences)
[15:36 – 17:28]
- Boards must navigate different (sometimes opposing) regulations and expectations: e.g., Europe’s ESG legislation vs. U.S. political dynamics.
- ESG requirements may force companies to act as supply chain regulators, broadening board responsibilities.
9. Strategic Frameworks: Responding to Issues and Communication
[17:28 – 21:14]
- Boards should use strategic frameworks to prioritize which issues to speak out on; cannot address or take positions on every issue.
- Communication teams and strategies for consistency and rapid response are increasing in importance, given global information spread and risks of misinformation.
10. Reputational Risk: The Uninsurable Wildcard
[21:55 – 23:01]
Roy Shapira:
- Reputational fallout is fast-moving, emotional, not insurable, and often arises in unfamiliar regulatory or consumer environments.
- Best practice: stay consistently aligned with company identity.
11. Illustrative Case Studies
[23:01 – 26:03]
- Pandemic in Wuhan: A global finance firm’s value-driven crisis response in Wuhan, China, guided by treating all global employees equally.
- Russia/Ukraine Withdrawal: Studies show that immediate asset losses from exiting Russia often outweighed by long-term reputational and market gains.
- Regional Relocation (Spain/Catalonia): Major political shifts influence company location decisions—even within countries.
- Delaware Exit: U.S. “jurisdiction shopping” (e.g., companies moving incorporation to Texas for legal advantages).
- Supply Chain Diversification: U.S./China tensions boost opportunities for countries like Vietnam and Indonesia, diversifying global value chains and increasing resilience.
12. China’s Growing Impact
[28:32 – 31:43]
- China remains central to global trade, supply chains, and innovation (including in tech like TikTok).
- Chinese companies adapt values/policies (e.g., ESG) to gain a competitive edge or access to new markets, e.g., the EU.
- U.S.-China negotiations: What one side considers a massive concession may be marginal for the other; understanding counterpart priorities is essential.
13. Board Competencies: What Matters Now
[31:43 – 35:08]
- Key skills: Good judgment, ability to make complex decisions with limited info.
- AI is an emerging issue—some boards experiment with “AI directors” (e.g., “Aidan”), but legal standing and bias are open challenges.
- Kevin McGovern: Governance structures emerging for AI: Board/management committees develop AI policy, with ongoing discussion about where to use AI and ethical limitations (e.g., in performance evaluations).
Quote [33:21]:
“Boards do not feel like they have perfect information... They’re always catching up.” — Kevin McGovern
14. Executive Compensation and Geopolitics
[37:21 – 39:15]
- The structure of executive pay is more important than level; pay systems should reinforce long-term strategic alignment, not just reward short-term wins.
- National/regional political climates (e.g., U.S. vs. Europe) shape what is considered acceptable or normal in pay inequality.
15. Future-Proofing Boardroom Capabilities
[39:52 – 41:56]
- Business schools and companies must now train leaders routinely in geopolitical and AI literacy, as these are becoming as essential as financial literacy.
- Board directors and students alike need to keep up-to-date, learn constantly, and participate in ongoing peer learning (e.g., professional associations, summits).
16. Looking Forward: The Next Decade
[42:07 – 42:36]
- Kevin McGovern: “More and faster”—expect growing volume and pace of change.
- Roy Shapira: Resilience will be the critical focus: diversifying decision-making, supply chain pressure-testing.
- Ruth Aguilera: Growing complexity and interconnectedness, especially with digital transformation.
Notable Quotes and Moments
- “Have a very consistent message... and very true to who you are as a company.” — Ruth Aguilera [07:13]
- “We do not need especially [subject-matter] directors. What we need is directors who have a lot of good judgment to make good decisions with limited information, in a very uncertain environment.” — Ruth Aguilera [31:59]
- “Boards have to be proactive about compliance. They cannot just sit there and wait until someone flags a problem...” — Roy Shapira [03:44]
- “Noses in, fingers out. That’s often the board credo. Stick your nose in and ask the right questions. You cannot have your keys on the keyboard, that’s management’s job.” — Kevin McGovern [10:13]
Key Timestamps
- 01:41: Geopolitics redefined for boardrooms
- 03:36: Legal perspective: board oversight and liability
- 05:59: First 72 hours checklist in a crisis
- 08:05: Board culture and crisis exposure
- 12:15: Political engagement, risks, and neutrality
- 17:28: Frameworks for issue response & communication
- 23:23: Case study: Wuhan and global employee care
- 24:43: Case study: Russia/Ukraine and long-term reputation
- 35:08: Training and upskilling for rising risks
- 42:07: Closing predictions for governance and geopolitics
Final Takeaways
- The scope of director responsibility continues to grow, with geopolitics now a top-tier risk domain.
- Board effectiveness hinges on consistent values, crisis-ready structures, transparent communication, and ongoing education.
- As complexity accelerates (AI, ESG, supply chains, regulatory divergence), resilience—both for organizations and their boards—will be the cornerstone of good governance.
For listeners: This conversation offers practical governance frameworks, a candid look at the limits of board control, and timely lessons about risk, decision-making, and surviving the next round of global shocks.