Good morning. Natural catastrophes, geopolitical tensions and economic unknowns were some of the leading topics of conversation among the roughly 9,000 risk professionals who attended the RIMS 2023 Riskworld annual conference in Atlanta recently.

The Covid pandemic hoisted risk management to a central component of business strategy, a shift that has landed many risk professionals front-and-center in their organizations. As the pandemic recedes, though, the job isn’t getting easier—volatility continues and new, interconnected risks are coming to the fore.

With risk experts gathering this past week, Risk & Compliance Journal spoke to industry leaders on their biggest concerns.

• Stormy weather: Businesses have faced higher-than-normal insurance costs for years and were hoping for a break. But inflation and the growing costs of natural disasters makes that unlikely any time soon, said Lambros Lambrou, the chief executive of commercial risk solutions at professional services company Aon. “Hurricane Ian [has become] the tipping point for the reinsurers who say, ‘We have not made money out of natural catastrophe reinsurance for quite some time, we need to have almost a reset around the way that natural catastrophe risk is priced,’" Mr. Lambrou said.
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• Banks under a microscope: Banking turmoil means insurance underwriters will be looking more closely at how financial institutions are governed before they offer policies, said Ron Borys, a managing director at Alliant Insurance Services. “The questioning could get a little invasive,” he said. Questions about risk governance are going to be a “focal point” in conversations about insurance coverage for directors and officers, he said.
   
• China tensions: Political risk insurance, meant to protect companies when they do business abroad, might become harder to get, particularly in China as geopolitical tensions mount, said Will Mule, the global risk solutions practice leader at brokerage HUB International. “Taiwan and China are still on a knife-edge right now,” he said. Compared with years past, insurance underwriters are beginning to ask more questions before offering policies. “Instead of being a typical off-the-shelf, it’s much more tailored to the business being insured,” Mr. Mule said.

The Risk & Compliance Forum on May 9 will feature speakers including Glenn Leon, chief of the fraud section at the Justice Department, Assistant Secretary for Export Enforcement Matthew Axelrod, Elizabeth Atlee, chief ethics & compliance officer at CBRE and Sidney Majalya, chief risk officer at Binance.US. You can register here.

Biden signs executive order to levy sanctions related to Sudan crisis.

President Biden signed an executive order enabling the U.S. to impose new sanctions on individuals and entities related to the conflict in Sudan, reports Risk & Compliance Journal's Mengqi Sun.

The order, published Thursday, expanded the scope of the U.S. sanctions regime against the East African nation to allow the U.S. Treasury Department and the State Department to blacklist people and entities involved in activities that threaten the peace, security and stability of Sudan.

Administration warns of AI’s dangers, but there’s a limit to what it can do.

The Biden administration views AI as a major opportunity for the U.S., but one that comes with significant risks. The administration has noted, for example, that systems designed to help with patient care have sometimes proven unsafe or ineffective, while algorithms used in hiring or lending have reproduced existing inequities or even created new biases and discrimination.

But so far, the administration has sought to place much of the burden of ensuring public safety on the companies developing the technology. That partly reflects the paucity of tools the White House currently has to regulate artificial intelligence, some observers say.

• The attorneys general of California and New York are investigating the National Football League for employment discrimination and a hostile work environment, their offices said, adding to the mounting scrutiny of the workplace behavior in America’s most popular sport.
   
• Sen. Elizabeth Warren (D., Mass.) has written to the former chief executive of failed First Republic Bank asking for more information on his and other executives’ pay, their support for rolling back bank regulations and management practices ahead of the bank’s collapse.

Businesses in China ask where the red lines are as Beijing cracks down.

Foreign companies in China are walking a tightrope between their need for business intelligence to comply with proliferating U.S. sanctions and mounting concerns about the risks of carrying out the due diligence required for business on the ground.

Authorities recently questioned staff at consulting firm Bain & Co.’s Shanghai office and detained the Beijing-based workers for U.S. due-diligence company Mintz Group. The news has put companies that conduct due diligence and business intelligence in China on heightened alert, with details about the visits scant and uncertainty swirling around what triggered them.

• Regional-bank stocks tumbled Thursday despite assurances from the Federal Reserve that the banking system is on solid footing.
   
• This week’s tumble in oil prices has its origins in concerns that the Federal Reserve’s campaign of higher interest rates is slowing the economy and curbing energy demand.
   
• Moscow accused the U.S. of organizing this week’s drone attack on the Kremlin, while Washington denied any involvement and began its own investigation into what happened.
   
• The European Central Bank slowed the pace of its interest-rate increases but signaled it isn’t ready to pause its campaign against high inflation, diverging from the Federal Reserve.
   
• Insurer AIG, which reported earnings Thursday, was buoyed by higher premiums on business insurance.

Nearshoring. Automation. Supplier diversification. Sustainability. WSJ Pro takes a closer look at how companies are reshaping their logistics.

• A larger share of revenue at big U.S. companies is beginning to reach the bottom line, a potentially encouraging sign for a stock market that has been stuck in neutral in recent weeks.
   
• Bud Light’s delivery drivers, sales representatives and independent distributors have been confronted by angry people on the streets, in bars and in stores. The brewer is paying a $500 bonus to each of those workers.
   
• Regulators’ warnings and a series of bank failures have caused some banks to step away from crypto clients. A handful of middlemen companies are helping keep the nascent industry banked.
   
• Toronto-Dominion Bank and First Horizon have called off their $13.4 billion merger.
   
• Ed Sheeran didn’t rip off a Marvin Gaye classic when he wrote his chart-topping ballad “Thinking Out Loud,” a New York federal jury found Thursday.