RISKS & CRISES IN THE NEWS - January 25, 2026

RISKS & CRISES IN THE NEWS

Date: January 25, 2026

Published by: International Association of Risk and Crisis Communications (IARCC)

This weekly IARCC report reviews key strategic, operational, financial, compliance and reputational risks shaping the global risk environment. It is intended to help leaders, boards and risk professionals understand emerging signals, assess exposure, and anticipate second- and third-order impacts across sectors.

Strategic Risk

Issue

This week’s strategic risk environment was marked by one of the most significant speeches in modern memory. It came from Canadian Prime Minister Mark Carney, who struck at the heart of the American administration’s bullying of allies and the rules-based international order.

At the 56th World Economic Forum in Davos, Carney delivered a speech that reverberated far beyond the conference itself. In plain language, he argued that the post-Second World War international system — built on shared rules, institutions and predictable behaviour — is no longer functioning as many governments and businesses still assume. Economic integration, once seen as a stabilizing force, is now being weaponized. Tariffs, trade threats, sanctions and political pressure are increasingly used as routine tools of leverage, even against allies.

Carney described the moment not as a temporary disruption, but as a rupture. The old assumption that participation in global markets and alliances automatically ensures stability no longer holds.

He warned that compliance with existing rules is no longer enough to protect middle powers — or the companies that operate within them — from coercion by larger states.

While the speech avoided naming specific governments, it was widely understood as a direct response to recent U.S. rhetoric and actions that have unsettled allies, questioned security guarantees, and reframed economic dependence as a vulnerability rather than a shared strength.

Rather than calling for a return to the old order, Carney urged middle powers to face reality and adapt. He argued that countries like Canada, European states and other democracies must actively coordinate, diversify their economic relationships, and build resilience together.

Waiting for stability to re-emerge on its own, he suggested, is no longer a strategy.

Read the speech

https://www.cbc.ca/news/politics/mark-carney-speech-davos-rules-based-order-9.7053350

Note: as of this writing, President Trump has threatened to impose 100% tarriffs if Canada pursues a trade deal with China, raising strategic stakes even higher.

Issue

Ukraine war and energy security risk. Russian airstrikes plunged Ukraine into its worst energy crisis since the war began. The CEO of Ukraine’s largest private energy producer, DTEK, said power outages are bringing the situation “close to a humanitarian catastrophe,” affecting households, hospitals and industrial customers.

Issue

Europe: infrastructure, alliance strain and accountability risk. Europe faced multiple stress points. Spain suffered two serious train accidents this week, including a high-speed crash in Andalusia that killed 45 people, raising questions about whether rail-network maintenance by state rail infrastructure manager ADIF and operator Renfe is keeping up with demand.

Prince Harry, UK Prime Minister Keir Starmer and others publicly castigated President Donald Trump for accusing allies of shirking their front-line roles in Afghanistan.

In Switzerland, the owner of a bar that burned in a deadly New Year’s Day fire was placed in pre-trial detention, amidst an outcry from victims’ families and concern from around the world.

Issue

United States: domestic unrest and immigration enforcement risk. In the United States, Minnesotans held an economic strike to protest ICE operations. Scores of small businesses in Minneapolis — particularly restaurants, retailers and service providers — shut their doors as workers gathered outdoors in extreme cold to oppose the deployment of ICE troops.

Vice President JD Vance defended the actions, blaming “far-left agitators” and uncooperative local officials. A U.S. appeals court lifted a lower court order that had restrained federal officers from arresting or tear-gassing peaceful protesters.

Issue

U.S. politics: immigration backlash and midterm risk. The political fallout is growing.

Some Republicans fear the ICE deployments could alienate voters ahead of November’s congressional midterm elections, while Democrats worry that calls within their party to abolish ICE could damage support among voters concerned about immigration and border security.

Issue

Middle East: energy, sanctions and escalation risk. In the Middle East, the United States threatened to restrict Iraq’s access to oil revenues if armed groups backed by Iran were included in Baghdad’s next government, a move that could affect state-owned oil marketer SOMO and international buyers.

Washington also sanctioned nine vessels linked to Iran’s shadow tanker fleet following the killing of protesters. Several U.S. guided-missile destroyers and an aircraft carrier were deployed to the region.

In Syria, government forces seized large areas previously held by Kurdish fighters after an agreement to bring Kurdish civilian and military authorities under Damascus’ control, with both sides massing forces as deadlines approached.

Issue

Corporate and labour market disruption risk. At the corporate level, Amazon announced plans for another round of layoffs.

The 30,000 jobs at risk represent roughly 10% of its corporate workforce.

While the earlier round of 14,000 cuts was attributed to artificial intelligence, CEO Andy Jassy later told analysts the reductions were about organizational culture and “bloat,” not AI.

At Davos, Nvidia CEO Jensen Huang predicted artificial intelligence would lead to higher pay and increased demand for skilled trades such as electricians, plumbers and steelworkers.

Others warned of severe societal risks, including mental-health impacts, while labor leaders questioned whether recent technology gains are delivering broad-based benefits.

What these strategic risks mean for business

Strategic risk is manifesting simultaneously across geopolitics, domestic unrest, energy security, infrastructure resilience, and labor markets.

Businesses face rising exposure to state coercion, social disruption, infrastructure failure, and abrupt policy intervention.

Political instability is no longer confined to fragile states; it is affecting core markets, supply chains, and workforces.

Companies should assume higher volatility, more frequent shocks, and faster spillover from political events into operational and financial outcomes.

Operational Risk

Issue

Critical infrastructure failure and public safety risk. Multiple infrastructure-related incidents underscored operational fragility this week.

Spain’s fatal rail accidents, Ukraine’s degraded power grid under sustained attack, and ongoing concerns over aging infrastructure in advanced economies highlight the rising operational risk posed by underinvestment, deferred maintenance, and conflict-driven degradation.

These failures are occurring under conditions of peak demand and heightened public scrutiny.

What this means for business

Organizations that rely on public infrastructure — transportation, energy, communications — face increasing exposure to service interruptions and safety incidents.

Manufacturing firms, logistics operators and data-centre providers are particularly exposed when grids or transport systems fail.

Issue

Cybersecurity and third-party vendor risk. Recent weeks have seen multiple cyber incidents involving third-party vendors, including ransomware attacks affecting healthcare providers, data breaches at consumer-facing platforms, and security failures at payment processors used by global retailers and airlines.

These incidents demonstrate how indirect exposure can quickly become a direct operational crisis.

What this means for business

Companies in sectors such as healthcare, retail, aviation and financial services must assume that vendor failures will reach customers.

Contractual safeguards, access controls and incident-response coordination are critical.

Issue

Labour disruption and workforce availability risk. Large-scale layoffs, labor protests, and politically driven enforcement actions have disrupted normal operations across multiple sectors.

Companies such as Amazon, hospitality operators in Minneapolis, and logistics firms exposed to protest-related shutdowns have faced workforce instability and reputational spillovers.

What this means for business

Operational resilience increasingly depends on workforce stability. Employers must prepare for sudden labor shortages, walkouts and morale shocks that can halt operations with little notice.

Issue

Emergency response and crisis readiness gaps. Incidents such as deadly fires, delayed emergency responses, and confusion over jurisdictional authority have exposed weaknesses in emergency preparedness and crisis coordination, particularly for hospitality venues, transport operators and public-facing facilities.

What this means for business

Companies operating physical venues, transport assets or high-occupancy facilities must regularly test emergency plans and crisis communications under real-world conditions.

Financial Risk

Issue

Debt-fuelled AI investment and balance-sheet risk. Growing concern is emerging over debt-funded artificial intelligence infrastructure.

Major technology firms and data-centre operators, including Microsoft, Amazon and Google, have committed tens of billions of dollars to AI-related capital expenditure, often financed through debt, despite uncertain cash-flow visibility, rapid hardware obsolescence and rising energy costs.

What this means for business

Suppliers across the AI ecosystem — semiconductors, utilities, construction and cooling infrastructure — face revenue volatility if spending slows or is reprioritized. Balance-sheet discipline is increasingly critical.

Issue

Market volatility driven by geopolitical and policy shocks. Financial markets remain highly sensitive to geopolitical escalation, sanctions, and abrupt policy announcements.

Energy companies, defense contractors and commodity traders have experienced sharp repricing following tariff threats, military deployments and sanctions announcements.

What this means for business

Treasury and risk teams should expect abrupt swings in currency, energy and commodity prices. Firms with thin margins or unhedged exposure face elevated earnings risk.

Issue

Rising public debt and sovereign fragility risk. Growing concern is mounting about rising public debt levels in advanced economies, including the United States, the United Kingdom and Italy, driven by persistent deficits, higher interest rates and political reluctance to adjust fiscal policy.

Elevated sovereign yields are beginning to crowd out private investment.

What this means for business

Higher sovereign borrowing costs translate into tighter credit conditions.

Infrastructure contractors, real-estate developers and capital-intensive industries are particularly exposed.

Issue

Consumer affordability and demand compression risk. Wage growth continues to struggle to keep pace with living costs, particularly for housing, healthcare and food. Retailers, automakers and consumer discretionary brands are reporting softer demand and higher sensitivity to price increases.

What this means for business

Revenue growth assumptions should be stress-tested against weaker consumer demand. Credit risk and inventory management are rising priorities.

Issue

Activist investors and forced corporate restructuring risk. Activist investor campaigns are increasingly pushing companies toward breakups, asset sales and aggressive cost-cutting, particularly in retail, media and industrial sectors.

What this means for business

Boards and executives must prepare for activist engagement, especially where valuations lag peers or margins deteriorate. Clear capital-allocation narratives are essential.

What this means for business (overall)

Financial risk is increasingly driven by the intersection of geopolitics, leverage and social pressure rather than traditional economic cycles alone.

Companies should stress-test balance sheets, funding access and demand assumptions against scenarios involving sudden market repricing and policy-driven shocks.

Compliance Risk

Issue

Regulatory acceleration and enforcement expansion risk. Between January 17 and January 24, compliance risk signals intensified across multiple jurisdictions as regulators accelerated enforcement, expanded reporting obligations, and tightened controls in response to geopolitical tension, cyber risk, and financial instability.

In Europe, regulators moved further into the enforcement phase of sustainability and supply-chain regimes, increasing scrutiny of climate disclosures, due-diligence processes, and the accuracy of emissions reporting.

Financial institutions operating in the United Kingdom entered the period following publication of the final Basel 3.1 rules, with the effective date set for January 1, 2027, raising concerns about reduced lending capacity, model validation challenges, and supervisory intervention.

In the United States, enforcement attention continued to shift toward cybersecurity, data protection, and sanctions compliance.

Regulators emphasized timely incident notification, third-party risk oversight, and accountability for executive decision-making following breaches or compliance failures.

Globally, sanctions compliance risk remained elevated. Expanded designations targeting energy shipping, financial intermediaries and state-linked entities increased the risk of inadvertent exposure through counterparties, logistics providers and payment channels.

What this means for business

Compliance risk is becoming more dynamic, punitive, and closely tied to geopolitical developments. Organizations should expect higher enforcement intensity, rising compliance costs, greater third-party exposure, and increased personal accountability for directors and senior executives.

Reputational Risk

Issue

Political polarization and protest anniversary risk. On the first anniversary of President Donald Trump’s second inauguration, coordinated protests were held across multiple U.S. cities, framing the event as a referendum on democratic norms, immigration enforcement and executive power. Organizers promoted mass participation and civil resistance, drawing widespread media attention and corporate scrutiny around perceived political alignment.

What this means for business

Brands operating in major urban centres face elevated reputational exposure during politically charged anniversaries. Corporate silence, public statements or security responses can all be interpreted as political positioning.

Issue

Public detention and human rights scrutiny risk. Reputational scrutiny intensified following reports of increased immigration detentions, including families and minors, raising questions about government transparency and treatment of detainees. Advocacy groups and media outlets amplified criticism, increasing pressure on institutions seen as cooperating with enforcement actions.

What this means for business

Companies with government contracts, logistics involvement, or physical proximity to enforcement operations may face reputational spillover risk, even without direct policy influence.

Issue

Political brand erosion and economic credibility risk. Polling released during the period showed a widening gap in public trust toward governing parties, particularly among voters living paycheck to paycheck. Analysis highlighted erosion in economic credibility and leadership confidence, with implications for political stability and policy continuity.

What this means for business

Declining trust in political leadership increases policy uncertainty. Businesses should prepare for abrupt narrative shifts, reactive policymaking, and reputational volatility tied to electoral dynamics.

Issue

Media amplification and narrative volatility risk. Social and digital media intensified reputational exposure around all of the above issues, compressing response times and amplifying missteps. Narratives hardened quickly, leaving limited space for correction or nuance.

What this means for business

Reputational resilience depends on speed, transparency and credibility. Delayed or reactive messaging increases long-term brand damage.

Bottom line

This week underscored how quickly strategic, operational, financial, compliance and reputational risks can cascade across borders and sectors.

From war-driven energy collapse to infrastructure failure, cyber exposure, regulatory enforcement, political polarization and brand erosion, the global operating environment is tightening.

Businesses that fail to integrate these risks into strategic decision-making risk being overtaken by events.

Need specialized insight on a particular industry, risk type, or geography?

Contact IARCC to request tailored analysis, sector briefings, or strategic support for risk communications planning.

Categories: : RISKS/CRISES IN THE NEWS WEEKLY