As protests against ICE’s immigration crackdown roil in Minnesota, businesses are braced for the familiar trifecta of risks: disrupted supply chains, staff safety concerns, and potential damage to property.
But according to political risk specialists, the more serious threat to corporate stability may not be protest activity itself, but a more corrosive and less visible force: political polarization.
“Polarization has brought political decisions into our personal lives,” said Sam Wilkin (pictured), director of political risk analytics at WTW, formerly Willis Towers Watson.
“That impacts not just who we marry, but who we work with, and who we want to work with. That’s a big problem for employers and companies, especially if you're selling to a consumer.”
In risk assessments, protests are often treated as discrete, event-driven shocks. They are usually triggered by specific government actions, such as cost-of-living pressures or, in Minnesota’s case, policing policies and immigration enforcement. But while protests may subside once demands are addressed or political momentum fades, polarization, by contrast, reshapes the social environment in which companies operate and increasingly drives long-term business risks.
Polarization has risen globally, but the US stands out. In WTW’s research covering more than 100 countries, the US is unusual in experiencing simultaneous increases in affective, ideological and leadership polarization. That convergence heightens the risk of instability.
The roots of this phenomenon stretch back to the 1960s and 70s, when the Vietnam War, civil rights legislation and gender equality reforms triggered federal-state conflicts and mass protest movements.
Yet Wilkin noted a puzzling development: even after many of those policy disputes subsided, affective polarization continued to intensify. “What our research showed was that around the world there's been this huge surge in affective polarization over the past 15 years, which corresponds very closely to the rise of social media,” he said.
While correlation does not prove causation, studies by researchers at Stanford and NYU suggest algorithm-driven content amplification may harden political identities and deepen in-group hostility.
“Interestingly, the biggest increases show up among older demographics, who are not heavy social media users,” Wilkin added. “So, there’s more going on here than just technology.”
Wilkin also distinguished between ideological polarization, or disagreement over policy, and affective polarization, where political identity becomes personal.
“It’s not just that you disagree with someone’s views; you actively dislike them,” he said. “This is where politics moves into who you work with, who you want to hire and how comfortable you feel in the workplace.”
That hostility is reflected in survey data. The Pew Research Center said that in 2022, 72% of Republicans and 63% of Democrats viewed the opposing party as more immoral than other Americans, up dramatically from 47% and 35% in 2016. Last year, eight in 10 US adults said that when it comes to important issues facing the country, Republican and Democratic voters not only disagree on plans and policies but also cannot agree on basic facts.
For companies, the most troubling aspect is the link between polarization and violence.
While protests can turn violent, Wilkin argued the stronger relationship is between polarization itself and violent acts, including attacks on public figures and business leaders.
“It's just not clear which causes the other,” he said. “You can imagine it both ways. If you see someone being shot in your city, you might be more likely to adopt a violent action like shooting someone.”
It’s a vicious cycle, said Wilkin, and one that businesses are increasingly having to manage for their workforces, executives, and public reputations. According to the US Insurance Information Institute, insured losses from civil disorder were estimated around $1-2 billion in 2020 alone, the highest on record.
Academic research offers some hope at the individual level. Experiments published in journals such as Science and Nature Human Behaviour show that emphasizing shared values before discussing disagreements reduces hostility and improves cooperation across political lines. Scaling such interventions to the societal level is the challenge, said Wilkin. WTW’s historical analysis suggests that declines in polarization often followed repression or major external shocks.
National crises, including wars, have temporarily unified divided societies, as seen in Ukraine after Russia’s 2022 invasion. Truth and reconciliation processes have also reduced polarization, but typically only after severe internal conflict. “Obviously, nobody wants that,” said Wilkin.
Some polarization is actually healthy for democracy. “You want to have a bit of polarization to differentiate between political parties,” Wilkin noted. “In a way, polarization is the curse of interesting politics. As people get more engaged in politics, they get more polarized.”
For now, businesses are left to manage the consequences rather than the cause. Human resources teams are grappling with workforces that increasingly resist collaboration across political lines. Executive activism, where CEOs take public stances on social issues, has become more common but carries risks.
“You can alienate employees or customers very quickly,” Wilkin warned. “Companies are increasingly having to see themselves as political actors. No one's on firm ground at this point. It's incredibly shaky.”
