Investment and collaboration critical to managing global risks

Responding to this week’s release of the Global Risks Report 2022, IIRSM CEO Phillip Pearson said concerns about international failures to mitigate many of the threats to planet and people were disappointing and rapid progress had to be made in 2022, with investment of time and resources in risk management an unquestionable priority.

Published by the World Economic Forum, the Global Risks Report examines the findings of a survey of nearly 1,000 risk experts and global leaders in business, government and civil society.

Its key findings include

Covid-19 hindsight: Societal and environmental risks have worsened the most since the start of the pandemic, with “social cohesion erosion” and “livelihood crises” taking the top spots. Debt crises, cyber security failures, digital inequality and a backlash against science were among other Covid-related risks identified.

Outlook and sentiment: More than four in five respondents (84%) expressed negative feelings about the future, saying they were ‘concerned’ or ‘worried’ about the ‘volatile, fractured or increasingly catastrophic’ short-term outlook. This pessimism could be pervasive, said the report authors, creating a cycle of disillusionment that makes the global recovery more challenging.

Horizon: Considering threats to the world in the next two years, respondents highlighted social cohesion erosion, livelihood crises and mental health deterioration as three of the five risks to cause most concern. In terms of risks for the short, medium and long term, environmental risk came top of the list. In the medium term, economic risks such as debt crises scored highly.

Severity: Ranking the risks for severity, respondents pointed to environmental risks as having the potential to cause the most damage to people and plant, followed by societal challenges. Debt crises and geoeconomics confrontations were also in the top 10.

International mitigation: Respondents were broadly disappointed with international efforts to mitigate the global risks. The most effective efforts were in trade facilitation, international crime and weapons of mass destruction. Very little headway had been made, however, in areas such as artificial intelligence, space exploitation, cross-border cyber attacks and migration and refugees.

Mr Pearson said: “What is striking about the Global Risks Report is the positive impact international collaboration has had on managing some of the most serious threats we face. COP26 demonstrated what can be done but clearly there are very real concerns about the lack of joint working in other areas.

“The message of hope is that we can turn the corner if we work together and we invest in risk management. 

“IIRSM members and the wider risk management profession are making a huge difference to the long-terms prospects of organisations by helping them to identify and then manage the risks. Investment in risk management by organisations must underpin international efforts to create a more sustainable world.”

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