Top 10 risks for 2013 and 2016 also unveiled

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Risk leaders across the world are struggling to identify and manage the major risks facing their organisations, according to Aon Risk Solutions’ latest biannual Global Risk Management Survey.

The survey of 1,415 organisations from 70 countries found that on average only 59% felt ready to manage the top 10 risks – a drop of 7% on 2011’s survey results.

Of the 28 industries surveyed, only three sectors, including pharmaceutical and biotechnology, non-aviation transportation and agribusiness, reported the same or improved levels of readiness this year.

Aon Global Risk Consulting chairman Stephen Cross said the prolonged economic recovery was a possible reason for the decline in risk readiness, stating that slow recovery “has strained organisations’ resources”, and hampered the abilities to mitigate these risks.

The survey also identified the top 10 risks for 2013 and unveiled Aon’s risk projections for 2016.

Economic slowdown/slow recovery, regulatory/legislative changes and increasing competition were named the top three risks for 2013 and 2016.

They also ranked as the top three in the Asia Pacific, Middle East and Africa, Europe, Latin America and North America.

Political risk broke into the top 10 risks for the first time in 2013 and is projected to move up to sixth place in 2016 survey “due to the increasing civil wars and social and political conflicts around the world”.

Weather/natural disasters, ranked at 16, is projected to jump to ninth place “given the unusual climate patterns worldwide and an unprecedented increase in natural disasters and weather events”, the firm stated.

Failure to innovate/meet customer needs is said to be “an increasing priority” and projected to jump from sixth place to fourth in the next three years.

Business interruption is expected to drop out of the top 10 risks due to companies’ efforts to improve business recovery planning.

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