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The war in Ukraine: Four areas of focus for finance and risk

May 27, 2022 10-MINUTE READ


In brief

Russia and Ukraine are vital world suppliers


of wheat


of barley


of sunflower seed oil


of corn

What this means for profitability

Note: Stagflation refers to the combination of sluggish growth twinned with high inflation. We consider the average of the UK, Germany and France. E = expected. PP = percentage point

Four areas of focus

1. Scenario planning

Remember: Good scenario planning isn’t a one-and-done exercise. It’s ongoing and iterative.

2. Operational risk

Business continuity risk

Companies with operations or IT in Russia or Ukraine are exposed to possible direct or indirect financial losses due to physical damage, logistics challenges, expropriation or an assets freeze. 15

Even if you don’t have direct operations in those areas, you may have portfolio-level business interests with exposure to the conflict. If so, review and update your business continuity plans with scenarios that account for a range of potential circumstances across your value chain.

Cyber risk

Instability is a convenient cover for both traditional and novel attacks. Emerging threats could affect companies directly or indirectly, such as in the case of an attack on critical national infrastructure.

Hackers are increasingly fueled by ideology, rather than traditional financial motives, which makes it that much harder to predict targets. 16

Third-party risk

Suppliers based in conflict territory, or those that have business interests there, pose a risk to things like:

  • contracts
  • delivery timeframes
  • loss of services
  • default
  • cybersecurity and more

Think about how you can adapt to partner disruption. Have a list of alternative suppliers at the ready. Remember: Third-party cybersecurity gaps may increase your exposure. Assess the risk they represent and prepare a response plan to third-party incidents.

Financial crime risk

Sanctions and trade restrictions expose companies to compliance risks. New circumvention attempts and behaviors might emerge, posing additional threats. While this type of risk is particularly relevant to financial institutions, other industries should take heed. Review and strengthen your screening rules to make sure they’re compliant.

Environmental, social and governance (ESG) risk

In some industries, high energy prices and security concerns could lead to a short-term slowdown in decarbonization, including in fossil fuels phase-out. On the other hand, they could encourage policy makers to hasten the transition to cleaner energy sources like renewables. 17

These dynamics may affect your short-term response, as well as your long-term sustainability agenda. Create a communications plan to keep investors and stakeholders up to date, should your organization’s ESG commitments change as the situation evolves.

3. Cost reduction

Quickly cutting general costs is a playbook move in a crisis, and this situation is no exception.

4. Divestment decisions


The approximate number of global companies that have announced full or partial withdrawal from Russia. 18

Eye on growth


Jason Dess

Senior Managing Director – Strategy & Consulting, CFO & Enterprise Value Global Lead

Jason helps CFOs re-define their vision for the future, create insight by leveraging emerging digital platforms, and drive efficiency across finance processes.

Bertrand Eding

Managing Director – CFO & Enterprise Value

Bertrand works with senior executives to strengthen their enterprise operating models with a focus on sustainable value creation.

Aneel Delawalla

Senior Managing Director – Accenture Strategy, CFO & Enterprise Value

Aneel focuses on creating enterprise value at the intersection of growth strategies, operating model transformation, and employee experience.

Michela Coppola

Senior Manager – Accenture Research, CFO & Enterprise Value Research Lead

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