The world is uncertain. Does your board have a macro compass?

Macroeconomics reflects the economic and political environment in which all kinds of companies operate – whether you are a large multinational or a small local business. So it matters to everybody.

It matters for daily operations. But it matters even more when developing strategies for the years to come. We are living in a world characterised by increasing uncertainty such as geopolitical tensions, wars in the Middle East and Ukraine, chaotic tariff policies, ageing populations reshaping the economic landscape, and the rapid adoption of artificial intelligence transforming entire industries. That is why macroeconomics has become one of the top items on board agendas around the world. And I am certain it will remain there for years to come.

It applies to every company – large and small

Knowledge of GDP growth in your domestic or export markets, inflation, wage trends, interest rates, exchange rates – all of these have a direct bearing on how your company operates and competes.

And it is not least important when making strategic decisions. Should you increase your investment? If so, how should you finance it? What do demographics tell you about future demand? What is consumer confidence signalling? These are all essential inputs for making the right decisions for your company.

The board's role: Scenarios, not just forecasts

The board can use macroeconomics in several ways. High-frequency data can give a picture of the current economic environment. But macro is perhaps most powerful as a tool for building scenarios about the future – not just a baseline, but also a positive and a negative scenario in which the key variables for your company are stress tested if they deviate from expectations.

By working with scenario analysis, you are much better prepared when something happens. And in the world we are living in today, we know that many things can happen.