FERMA has urged companies to use the economic recovery to invest in their resilience in a reaction to World Economic Forum Global Risk Report 2018 published on 17 January. We believe that an enterprise risk management process with leadership from a risk management professional can equip organisations with an effective investment decision-making tool to respond to threats to the environment and in the digital area.
The Global Risks Report uses evidence collected from 871 responses to its global risks perception survey about the probability and potential severity of 30 different risks over the next 10 years. For the 2017–2018 edition, it shows three environmental risks (extreme weather events, natural disasters and the failure of climate-change mitigation and adaptation) among the top five risks in terms of likelihood as well as impact. Two technological risks (large-scale cyberattacks and massive incidents of data fraud or theft) complete the top five risks in terms of likelihood.
Echoing our previous work in 2017 on cyber risk governance, FERMA argues that it is increasingly obvious that the risk governance of organisations must reflect the fast pace of change and the deeper risk interconnections. FERMA will continue to push hard for the recognition of the benefits of integrating a professional risk management structure within organisations. This will both provide not only a methodology for horizon scanning and crisis anticipation, but also help reduce the protection gap between economic and insured losses.
The Global Risks Report also introduces three new series: Future Shocks with 10 potential scenarios for global breakdown, Hindsight to trace the evolution of certain risks in time and Risk Reassessment where renowned risk experts share their insights.