Deglobalization and Technology Sovereignty: Implications for Global Banking Infrastructure

Rising geopolitical tensions, economic competition (trade wars), and national security concerns have fueled a deglobalized world order. Policymakers have been outspoken about the need to reduce technology dependence on other countries. Regulators and government agencies are increasingly prioritizing technology sovereignty by proposing standards, laws, and regulations that require global financial institutions to fundamentally reshape how they design their technology strategies and deploy their technology infrastructure. For example, leveraging jurisdictional-specific technology, removing suppliers from their critical supply chains or storing/processing data within jurisdictional borders.
This Capstone project examined the impacts of deglobalization on global financial institutions and defined how technology sovereignty challenges the way in which these firms develop and execute their technology strategies. The project defined the drivers behind jurisdictional pushes for technology sovereignty, analyzed the regulatory and legislative frameworks governing these requirements or expectations, and highlighted the potential impacts on financial institutions in those jurisdictions.  
Drawing on expert interviews and policy analysis, the team produced a regional sovereignty risk matrix that maps enterprise technology exposure across seven operational risk domains: regulatory conflict, data localization, cloud architecture, third-party risk, AI governance, resilience, and government rights to audit. These findings informed a prioritized set of recommendations to help institutions mitigate legal and operational risk in an increasingly fragmented regulatory environment.