Global Firms Lose $320 Billion to Geopolitical and Economic Disruptions

Geopolitical instability and economic shocks have cost global corporations $320 billion in lost earnings, according to research by EY-Parthenon. Nearly 3,500 publicly listed companies with revenues exceeding $1 billion annually saw profit margins erode during years of heightened volatility. The fallout from inflation, wars, and market meltdowns has left no sector untouched.

Mats Persson, UK lead for macro and geostrategy at EY-Parthenon, notes the end of an era marked by cheap money and stable geopolitics. "Government policy and global events now impact corporate value and profits more than they have in decades," he said. China's companies were hit hardest, with 25% of firms in the study losing at least 5% of EBITDA margins over three years.

The compounding crises—Russia's invasion of Ukraine, UK gilt market collapse, Middle East conflicts, and U.S. political uncertainty—have rewritten the rules of global business. Even blue-chip indices weren't spared, with 40% of FTSE 100 value fluctuations tied to macroeconomic turbulence.