Environmental risks are at the top of the World Economic Forum’s (WEF) Global Risk Perception Survey for the second year running, though the interconnected nature of risks observed in 2018 are believed to threaten the system on which economies and international relations are based.
The WEF’s Global risks report highlighted the intensified risks facing the world this year, stating a deteriorating geopolitical landscape is partly to blame for the pessimistic outlook in 2018 combined with growing concerns over environmental risks, with extreme weather events seen as the single most prominent risk.
However, the expected economic recovery is seen as an opportunity for governments and firms to shore up societies and business against these risks; “a widening economic recovery presents us with an opportunity that we cannot afford to squander, to tackle the fractures that we have allowed to weaken the world’s institutions, societies and environment.
“We must take seriously the risk of a global systems breakdown. Together we have the resources and the new scientific and technological knowledge to prevent this.
“Above all, the challenge is to find the will and momentum to work together for a shared future,” said Professor Klaus Schwab, Founder and Executive Chairman, WEF.
The survey ranked large-scale cyberattacks third place for likelihood of risks, and cyber threats are seen as a growing high-level risk.
John Drzik, President of Global Risk and Digital, Marsh said; “Geopolitical friction is contributing to a surge in the scale and sophistication of cyberattacks.
“At the same time cyber exposure is growing as firms are becoming more dependent on technology.”
Risk experts advise global businesses and governments to invest far more in resilience efforts to prevent a growing protection gap between economic and insured losses as the world enters a critical period of intensified risks.
Alison Martin, Group Chief Risk Officer of Zurich Insurance Group, said; “it’s not yet too late to shape a more resilient tomorrow, but we need to act with a stronger sense of urgency in order to avoid potential system collapse.”
“Unfortunately we currently observe a “too-little-too-late” response by governments and organisations to key trends such as climate change.”