We live in a new geopolitical reality where the old world order has partially collapsed, and a new one has not yet fully emerged. This places entirely new demands on companies' strategies and management. According to Professor Poul Fritz Kjær, who researches European integration, globalisation and global law, we are in the midst of a "fragmented globalisation" without a clear centre.
A World Without a Centre – Now Companies Must Find Their Own
When there is no longer a global policeman, how should business leaders navigate turbulent markets, fragmented blocs and uncertainty? They need to be a bit flexible, find their national anchor — and it might be a good idea to learn German, says CBS Professor Poul Fritz Kjær.
Af CBS Efteruddannelse“Previously, it was the North Atlantic — that is, the United States of America and Europe together — that constituted the centre of the world. That time is over.”
Poul Fritz Kjær, Professor
According to Poul Fritz Kjær, world power today is distributed among three main centres: the EU, the US and China. All three have the resources, technology and scale to influence the world. The fourth element in the equation, the so-called Global South, is a broad and diverse group of countries from Brazil to South Africa and India:
“It is not a unified bloc, but it is where the markets and allies of the future must be found. These alliances can largely define the new world order.”
This fragmentation, according to Poul Fritz Kjær, has replaced the earlier, more centralised form of globalisation in which the US played a kind of coordinating role.
“Today, there is no single overseer — just several actors taking turns claiming to be one, though none truly are,” he says. “This creates anarchy and unpredictability, and in the long run, it will cost everyone — including companies, the EU and the US.”
The Difficult Choices for Companies
This global disorder makes it extremely difficult for companies to think long-term.
“You don’t know whether the market you’re building a factory for will even exist tomorrow. So it’s risky to make long-term decisions, and that affects companies’ growth strategies and investment plans,” says Poul Fritz Kjær. He also points to the ‘splits’ many companies are in right now, as markets turn inward — as seen in the ongoing trade war.
“They need to regionalise their activities and forget about operating with a setup that works globally. Politically, it will be required that deliveries to the US are produced in the US, deliveries to Europe are produced in Europe, and so on. At the moment, large companies are divided and claim their nationality is defined by where they are located. But at some point, they will be forced to choose: who are you?”
Many companies are responding with hesitation — and by increasing their focus on secure markets. For European firms, this means a renewed emphasis on the domestic market.
“The only stable market for Danish companies right now is Europe, where you can feel reasonably confident you won’t be excluded. So we’ll see a much stronger focus on Europe than we’ve seen over the past 30 years.”
Poul Fritz Kjær, Professor
In Europe, the desire for strategic autonomy is growing. According to Poul Fritz Kjær, it’s not just about supply security, but about building domestic capacities across critical areas.
“China has spent years building a closed, self-sufficient system. The US is now doing the same. This puts pressure on Europe to follow suit,” he says.
This applies to everything from digital payment systems, satellite navigation and IT infrastructure to defence, energy and pharmaceutical production.
“It’s no longer about assuming the cheapest option is always the best. Now, it’s about resilience and self-sufficiency. Europeans have been too naive in the sense that they outsourced almost everything — regardless of where the supplier was located. But that no longer works, and Europe has unfortunately lost out by insisting on being the model student in the class and following rules that others have not.”
New World Order, New Winners
Poul Fritz Kjær does not foresee a complete decoupling, but rather a combination of risk diversification and rebuilding domestic capacity.
“Companies will spread production while also beginning to produce more themselves. The EU’s Critical Medicines Act and Critical Raw Materials Act are examples of how this shift is being supported politically.”
He points out that this transition also presents opportunities for companies that can offer solutions supporting Europe’s push for greater independence.
“There will be more European investment — and there is clearly a market opportunity in contributing to the strategic autonomy that Europe demands.”
Poul Fritz Kjær, Professor
What does this mean for company leaders in today’s new reality? Poul Fritz Kjær has no doubt.
“You need nerves of steel and the ability to lead in a geopolitical landscape. You also need to think more politically than you may be used to.
Additionally, you need people with ‘emerging market skills’ — those with experience from, for example, Brazil, South Africa, Thailand or similar contexts. They’re used to navigating more bureaucracy, greater political instability, and higher risks of political intervention than we’ve typically encountered in our part of the world.”
Large companies are one thing — but for small and medium-sized enterprises, and especially startups, the focus needs to shift.
“They need to learn German. Germany is a key player in the European economy, and Europe’s economy is the only safe harbour they can navigate right now. It’s the next logical market to enter if they want to scale up — and also when it comes to raising capital. The idea of being a startup with global ambitions that automatically looks to the US — that’s coming to an end.”
The companies that Poul Fritz Kjær sees navigating the high global waves most successfully are those that know where their anchor lies.
“It’s the companies that know what their core values and core activities are — and where in the world they belong. They really need to hold on to that anchor. If they can also stay the course, no matter how high the waves get, then there’s a future for them.”
- Poul Fritz Kjær is a professor at the Department of Business Humanities and Law at CBS.
- His main research focuses on European integration, globalisation and global law.
- He’s internationally recognised for his work on the relationship between law and political economy, and he developed the theory of the Law of Political Economy, which explores how legal structures influence and shape political and economic systems – both nationally and globally.
- He holds a PhD in law from the European University Institute in Florence and a doctorate in sociology from Goethe University in Frankfurt am Main.
- He's a member of Academia Europaea, has received the Elite Research Prize and has been awarded two prestigious ERC grants – a Starting Grant and an Advanced Grant.
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