After an unprecedented era of remarkably favorable financing conditions, circumstances are rapidly changing, redefining the global economy and challenging credit markets.¹  These intensifying headwinds could expose many borrowers to operational and structural pressures as central banks aggressively tighten monetary policy. At the same time, the ongoing Russia-Ukraine war continues to exacerbate inflation and cost pressures with high commodity, energy and food prices, as slowing global economic activity signals consumers' concerns.

Since the start of the COVID-19 pandemic, supply chain risks and supply chain management have risen to the top of business agendas. Where stable and reliable supply chains were once taken for granted, organizations are now having to be much more mindful of risks − such as key material shortages, labor scarcity and unpredictable freight transit time − that can impact a counterparty’s financial stability.

As recession risks rise around the world alongside the heightened prospect of markedly deteriorating credit conditions, this Guide describes four important steps that risk management professionals can take to protect their organizations from unwanted exposure in their supply chains.