Geopolitical Uncertainty: Why Governance and Liquidity Must Lead in 2026

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Geopolitical and macroeconomic uncertainty are no longer peripheral risks. They are now central to how organisations assess governance, manage liquidity and plan for resilience. Recent research by the US Institute of Internal Auditors’s 2026 Risk in Focus surveys shows a sharp increase in the ranking of geopolitical risk, surpassing even cybersecurity and regulatory change in some regions. While the data reflects international trends, the implications are directly relevant to South African businesses operating in a globally connected economy.

The Risk Environment Has Changed

Geopolitical instability affects far more than foreign policy. It has practical financial consequences, including:

• Disruptions to trade and supply chains

• Restricted access to capital

• Increased borrowing costs

• Exchange rate volatility

• Regulatory and sanctions-related exposure.

For South African organisations, particularly those reliant on imports, exports or foreign funding, these pressures can quickly translate into liquidity strain.

An End to Siloed Risk Management

One of the key insights from the article is the growing need for cross-functional collaboration. Geopolitical risk does not sit within one department. It cuts across finance, compliance, operations and strategy. Internal audit, accounting, finance and risk management must operate in a coordinated manner. Liquidity risk can no longer be treated as a narrow finance issue. It is a strategic governance priority.

Liquidity as a Strategic Risk

Financial and liquidity risk has moved into the top tier of audit priorities globally. This reflects a simple reality: organisations under financial pressure are more vulnerable to governance failures, operational disruption and reporting weaknesses. Effective liquidity oversight now requires:

• Ongoing cash flow monitoring

• Scenario planning and stress testing

• Clear internal controls

• Forward-looking financial reporting.

Without these measures, boards and executives may not have adequate visibility over emerging risks.

The South African Perspective

In line with CIBA’s position that governance must deliver practical outcomes, the focus should not be on expanding bureaucracy. The objective is resilience. Strong governance means:

• Transparent financial reporting

• Coordinated risk oversight

• Proactive liquidity management

• Clear accountability across functions.

In a volatile global environment, organisations that prioritise these fundamentals will be better positioned to absorb shocks and maintain stability.

Implications for CIBA Members

For accountants in practice:

• Support clients with forward-looking cash flow analysis and scenario planning

• Identify liquidity risks linked to exchange rates, supply chains and funding structures

• Position governance and liquidity advisory as value-added services

For accountants in commerce:

• Strengthen collaboration between finance, risk and operational teams

• Implement structured stress testing and contingency planning

• Ensure financial disclosures appropriately reflect emerging risk exposures

Conclusion

Geopolitical uncertainty is not a distant issue. It directly influences liquidity, compliance and governance outcomes in South Africa.

In this environment, accountants play a critical role as strategic risk advisers. Organisations that integrate audit, finance and risk management, and prioritise liquidity oversight, will be best equipped to navigate uncertainty and protect long-term sustainability.

Source Article: Accounting Today