Enterprise risk management professionals are well positioned to identify potential tariff impacts for their organisations by assessing their risk in three steps, according to Gartner.

“ERM is well positioned to help its organisation navigate the effects of a volatile tariff environment,” said Alex Ossington, director of advisory in the Gartner Assurance practice. “It’s likely that most organisations globally will encounter tariff-related challenges that will impact their ability to deliver goods and services.”

The three steps ERM leaders should follow include:

1. Assess how tariff risks impact their organisation
2. Prepare risk owners to navigate tariff volatility and uncertainty
3. Engage in proactive scenario analysis

To best prepare for the impact, extent and duration of the US tariff policies, ERM leaders can identify which risks are most relevant to their organisation, such as supply chain disruptions, retaliatory tariffs and regulatory and compliance risks. When assessing these risks, ERM teams should develop key risk indicators to provide triggers for any planned mitigation action.

Preparing risk owners to navigate tariff volatility and uncertainty involves working closely with supply chain professionals to evaluate the organisation's exposure to tariffs and other related risks. Key questions to address include:

1. What significant risks are posed to our organisation by tariffs?
2. Who are our critical suppliers and what impacts are they likely to experience? If they are impacted, how significantly will that disrupt our operations?

“ERM leaders should work with the CSCO to implement processes to monitor at-risk materials, map manufacturing locations and evaluate logistics landscapes; leveraging the organisation’s risk appetite to right-size risk response,” said Ossington. “ERM teams are uniquely positioned to spearhead scenario analysis efforts, enabling organisations to anticipate and mitigate tariff impacts effectively."

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