Geopolitical risk spikes
Economic turmoil, war in Ukraine and the continuing impact of a global pandemic … Business leaders haven’t faced such a unique set of challenges in a generation.
Building on a programme of research with business leaders from companies of all sizes from 10 different industry sectors in the US and UK, we throw a spotlight on business risk and resilience – past, present and future.
Why isn’t US business more worried about the political angle of geopolitical risk?
There could be a geographical element, the US is further away from the current theatre of war, but these perceptions can change dramatically and quite quickly and it will be interesting to see if that has changed when we do the survey again, post what now starts to potentially feel like a US ‘hot’ rather than a ‘cold’ war with Russia.
Roddy Barnett
Head of Political Risks & Trade Credit
What protection can be offered against the scourge of deadly weapons attacks?
If I was a risk manager in the US, the things I would be concerned about are the threats from deadly weapons events and strikes, riot, and civil commotion. All the statistics that we see show that there have been more and more mass shootings over the last four years; we thought the figures couldn’t get any worse and as recent events in Texas and Buffalo show every single year it does. It is vital that risk managers are not complacent about the risk, but actively prepare to help prevent and mitigate the impact of these horrendous incidents.
Chris Parker
Head of Terrorism and K&R, Beazley
Inflation concerns
55% of business leaders feel unprepared to manage inflation, rising to 65% in the US.
Civil unrest?
Is a real possibility as rising prices leave countries such as Turkey and Egypt vulnerable.
US faces dual challenges
From gun crime at home and upheaval in relations with Russia and China abroad.
Building business resilience
Is urgent. The insurance industry needs to support in areas such as war and terror, trade credit and D&O.
Chart scales are based on the percentage of companies ranking a risk as their leading concern and on the percentage of companies feeling ‘very prepared’ to anticipate and respond to each risk, standardised across the four risk categories: geopolitical, digital, environmental and business.
Sector impacts diverge as resilience falls away?
In terms of sector impact, it is notable that financial institutions and the hospitality sector are feeling the least resilient to the risk of economic uncertainty as spending power and investor confidence fall away. With public policy and trade relationships in turmoil, it is perhaps little surprise that energy & utility companies are particularly troubled by the prospect of political risk during 2022.
With public policy and trade relationships in turmoil, it is perhaps little surprise that energy & utility companies are particularly troubled by the prospect of political risk during 2022.