FM Global launches 2020 update to Resilience Index

Resilience is never more critical than in a world shocked by pandemic, and the top-ranked countries in the 2020 FM Global Resilience Index possess strong foundations for a robust rebound.

The annual index, published by FM Global, is the definitive ranking of nearly 130 countries by the resilience of their business environments. It provides companies with objective information about countries’ economic, risk quality and supply chain resilience – factors that create a springboard for businesses working to recover from the pandemic.

“When recovering after a crisis like COVID-19, resilience should be a key consideration for people, countries and businesses,” said Adriano Lanzilotto, operations vice president and client service manager for FM Global’s London operations. “The 2020 FM Global Resilience Index provides a strong indication of how a country’s business environment may fare during the recovery phase, and how quickly organisations in that country might be able to bounce back from the economic damage caused by COVID-19. This insight can be vital for making significant decisions as they establish or relocate facilities, expand supply chains and engage with new markets.”

In addition to outlining the post-pandemic business landscape, the FM Global Resilience Index stands as a dynamic reminder that conventional business risks – flood, cyberattack, fire, hurricanes, earthquakes, oil shocks and political upheaval – continue to threaten operations and overall value. 

“Unfortunately, a devastating global situation like COVID-19 does not stop other disasters from occurring,” said Lanzilotto. “With this in-mind, it is critical that businesses are diligent and make use of data-driven risk-and-resilience analysis, coupled with appropriate engineering-led loss prevention, to preserve a company’s value and growth opportunities throughout these difficult times.”

Top, bottom, risers, fallers

The index’s top-ranked regions (in descending order) are Norway, Switzerland, Demark, Germany, Sweden, Finland, Luxembourg, Austria, Central United States and Eastern United States (both the US and China comprise three regions with differing natural hazard exposure).

Norway occupies the top spot for the second year in a row, supported by strong economic productivity, a stable political environment, low corruption, high natural hazard risk quality and robust corporate governance. The United Kingdom ranked 13th for its overall ranking in this year’s update to the FM Global Resilience Index. 

The bottom 10 countries in the 2020 Resilience Index overall (in descending order) are Nicaragua, Nepal, Mali, Mozambique, Iran, Lebanon, Chad, Ethiopia, Venezuela and Haiti.

A major riser in this’s index is Taiwan, which climbed 6 places to 29^th place based on improvements in its urbanisation rate, natural hazard risk quality, and quality of its transport and utility infrastructure. Taiwan’s urbanisation rate – one of 12 index drivers – improved dramatically, moving the country up 42 places in that metric (the lower the rate, the lower the stress on infrastructure and the higher the resilience rank).

The biggest faller in the index is the Nicaragua, which fell 9 places to 121st place due to increases in cyber and political risk as well as decreased control of corruption.

“Resilience is ultimately a product of the choices businesses make, including where they do business and how they invest in each location,” said Sanjay Chawla, chief investment officer at FM Global. “The index is designed to make these choices clearer as executives weigh the regular strategic reasons – logistics, labour force and market opportunity – for selecting particular geographies.”