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Risk management
PESTEL analysis facilitates proactive risk management by identifying and assessing external factors that could pose a threat to the company. By understanding these risks, the company can develop mitigation strategies and contingency plans to protect against potential negative impacts.

As we have seen, PESTEL is a powerful tool that provides a deep understanding of a company's external environment and helps inform strategic decision-making, opportunity and threat identification, strategic planning and preparation, risk management, and the company's strategic direction.

How to perform a PESTEL analysis step by step
At this point, you already know the theory behind the PESTEL analysis, and now you need to learn how to carry it out so you can properly study your business environment. These are the phases you should consider and analyze when carrying it out:

Step 1: Identify the political factors
Political factors include government policies, political stability, regulations and laws, international relations, and tax policies. They are of great importance because they can affect a company's ability to operate, its profitability, and its business strategy.

Examples of political factors
Some examples of these political factors can be the following:

Changes in political leadership: Elections, changes in british student data government, and the ideology of political leaders can influence policies and regulations that affect businesses.
Legislation and regulation: the adoption of new laws, regulations, or changes to existing ones, as these may impact areas such as taxes, international trade, the environment, occupational health and safety, among others.
Political stability: Political stability or instability in a country can affect investor confidence, legal certainty, and long-term business planning.
International relations: Trade disputes, international sanctions, or trade treaties can influence companies' foreign trade operations and strategies.
Fiscal policy: Changes in tax rates, tax incentives, or government spending policies can impact consumer demand, business investment, and profitability.