ANALYSING RISK: THE REWARDS OF INTELLIGENT RISK MANAGEMENT
Every organisation, regardless of its size and the sector in which it operates, faces risks. While many of these can be tackled effectively, the reality is that they cannot be eliminated entirely, rather managed and minimised to the furthest extent possible.
Moreover, risks are emerging at pace. In 2022, geopolitical tensions, the climate crisis, the after-effects of the global coronavirus (COVID-19) pandemic and cyber security threats all created a hugely challenging network of risks for organisations. Ramping these up considerably is the Russia-Ukraine conflict, which has sent shockwaves across the world.
Testifying to this is the World Economic Forum’s (WEF’s) ‘Global Risks Report 2022’, respondents to which said they expected the next three years to be characterised by either consistent volatility and multiple surprises or fractured trajectories that will separate relative winners and losers. Some foresaw progressive tipping points with increasingly catastrophic outcomes.
Adding further oversight as to the gravity of the current and future global risk landscape is the ‘Munich Security Index 2022’, which provides in-depth insights into how G7 and BRICS nations view 31 major global and domestic risks by combining five metrics: overall risk, potential damage, expected trajectory, perceived imminence and feelings of preparedness.
The overall picture painted by the Index is one of growing concern about risk. Based on a survey conducted among 12,000 people globally, those polled indicated that they were more risk-aware than ever before. Moreover, in Europe and beyond, a sense of “collective helplessness” in the face of global events is prevalent.
Jan-Mar 2023 Issue
Fraser Tennant