The world is facing a new global threat matrix

Both IMF and IPCC have identified an actor-less threat.

• The Global Risks Report reveals the top risks requiring urgent global action.
• Past years have seen a lack of mobilization on risk areas perceived to be long-term or abstract, but the pandemic has shown just how much the cost of inaction far outweighs the cost of action.
• As leaders convene next week at the Davos Agenda 2022, this Risks report delivers a strong message to overcome divisions and come together to face the short-, medium- and long-term global risks.

Connect risk to strategy

Risk analysis shapes decisions, creates forecasts and reveals the policy gaps requiring action. It’s why the World Economic Forum sets the agenda for the year with the launch of the Global Risks Report every January.

Now in its 17th edition, the report encourages leaders to think outside the quarterly reporting cycle and create policies that “connect risk to strategy”.

Risk or reality?

In 2020, the seemingly obscure risk of a pandemic became a reality.

In 2021, cyber risks reached new milestones with the highest average cost of a data breach in almost two decades. At the same time, floods, fires and weather-related disasters dominated headlines. Climate continued to shift from the abstract to an urgent risk category.

This year, the pandemic has refocused the lens on risk, and leaders are more acutely aware of the consequences of (mis)managing public perceptions of risk.

The interconnectedness of risks – from climate threats to cyber threats – is more real in the light of the parallel crises we have experienced during the pandemic. Economic woes, sustainability setbacks, societal anxieties and technology scares have jostled for attention alongside the health crisis.

Carolina Klint, Risk Management Leader, Europe, Marsh McLennan, emphasizes, “This risk environment is incredibly interconnected and we have to take a very holistic view of the emerging risk landscape.”

Young people are increasingly critical of government inaction. A survey of 10,000 people between the ages of 16 and 25 highlights climate anxiety, with 75% of respondents describing the future as “frightening”.

It’s not just the young who are worried. A series of surveys put to the global public throughout 2021 demonstrates rising concerns about personal health and safety, financial and health worries, loss of trust in governing institutions and more.

And a recent consumer index shows that there’s a sense that the personal fragility experienced by individuals has led to a “shift from a more passive concern to active caretaking, driven by the desire to protect ourselves, our communities and the security of the planet.”