Climate change, social tensions and cyber security have ranked as the biggest global risks in a new survey from the World Economic Forum (WEF) alongside the ongoing consequences of the COVID-19 pandemic.
Of the nearly 1,000 respondents from business, government and academia, just 16 per cent had a positive outlook and only 11 per cent believed the global recovery would accelerate.
“Health and economic disruptions are compounding social cleavages,” said World Economic Forum managing director Saadia Zahidi.
“This is creating tensions at a time when collaboration within societies and among the international community will be fundamental to ensure a more even and rapid global recovery.”
Respondents ranked environmental risks, including climate action failure, extreme weather and biodiversity loss, as the most severe globally over a 10-year horizon.
Climate was also one of the top risks identified by 12,000 global business leaders in a separate survey by WEF, while the biggest concern for the next two years is livelihood crises.
“Failure to act on climate change could shrink global GDP by one-sixth and the commitments taken at COP26 are still not enough to achieve the 1.5 C goal,” said Zurich Insurance Group chief risk officer Peter Giger.
“It is not too late for governments and businesses to act on the risks they face and to drive an innovative, determined and inclusive transition that protects economies and people.”
Cyber security was the number one risk for Australian business leaders, as well as those in Great Britain, Ireland and New Zealand.
The next biggest risks identified by Australian leaders were extreme weather events, climate action failure, infectious diseases and debt crises in large economies.
“As companies recover from the pandemic, they are rightly sharpening their focus on organisational resilience and ESG credentials.” said Marsh risk management leader Carolina Klint.
“With cyber threats now growing faster than our ability to eradicate them permanently, it is clear that neither resilience nor governance are possible without credible and sophisticated cyber risk management plans.”
Jon Bragg
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.
