70% of Leaders Report Rising Supply Chain Risk from AI and Geopolitics

A new KPMG International report commissioned across 109 senior executives globally shows that 70% of business leaders report increased risk exposure in their supply chains over the past two years. Technology and AI disruption tops the concern list at 64%, followed by geopolitical conflict at 58%. The report emphasizes that supply chain resilience is no longer just an operational function but a board-level strategic imperative, particularly as interconnected risks amplify disruption across shipping, financing, and industrial production.

The research highlights a critical vulnerability: 56% of respondents expect external disruptions involving geopolitical, energy, cyber, or climate factors to cause severe operational impact within three to five years. Yet only 28% of organizations have made energy security a strategic priority. Most worrying is the finding that traditional diversification strategies fail when multiple suppliers depend on the same maritime chokepoints, such as the Strait of Hormuz, where Iran tensions directly threaten global energy and freight flows.

Organizations are adopting advanced technologies to build resilience, with 49% prioritizing AI and predictive analytics, 44% investing in scenario planning, and 39% pursuing alternative sourcing. However, a confidence gap exists: 70% believe they can weather major disruptions, yet their actual preparedness and strategic prioritization lag significantly behind the stated risks.