Economic and societal risks top worries in 2017

Unemployment, fiscal crises and the failure of a nation’s government to provide stability are the top risks facing businesses globally while cyber risks are rising in importance, according to new data from a survey by the World Economic Forum (WEF).

The new data is drawn from the WEF’s proprietary Executive Opinion Survey (EOS), which among many other things, asks respondents to identify the five biggest risks to doing business in their respective countries. In 2017 the EOS was conducted between February and June and the question on risks to doing business was answered by 12,411 executives across 136 countries.

Executives’ responses identified economic, geopolitical, social and technological risks as likely to carry the greatest dangers for their businesses over the next 10 years.

John Drzik, president of global risk and digital at Marsh, one of the strategic partners of the Forum’s Global Risks Report, said: “While the fragility of the global economic recovery remains the chief business concern, executives are increasingly worried about the potential for cyber and other technology-related risks to threaten their ability to operate.

“Business leaders in many of the world’s largest economies now rank cyber as their top risk. Companies need to rigorously analyse how these threats could impact their operations and take appropriate risk mitigation and resiliency measures.”

John Scott, chief risk officer, commercial insurance at Zurich, said of the findings: “Whilst economic growth and technological developments create new opportunities for business and countries, geopolitical risks and events have led to uncertainties which raise questions about how to manage resilience in uncertain times.

“It is essential for businesses to have clear risk management strategies in place, developing options for legal structures and operational choices which take account of uncertain policy outcomes. It’s frustrating and resource intensive, but that’s the kind of strategic thinking business needs, to deal with the uncertainty and to build resilience to the risks that might emerge in different scenarios. Looking at the survey results, it appears that in the medium-term, business leaders are focusing on social and economic risks, but shouldn’t underestimate the potential impact of environmental and technological risks as well.”