Risky Business: What's Worrying Execs in Different Regions of the World?
The World Economic Forum's 12th annual “Regional Risks for Doing Business” offers a look at what executives in different regions view as their biggest threats. The study found that concerns about cyberattacks are on the rise, especially in the world's most advanced economies, while the primary worries for execs worldwide centered on unemployment and government failure.
November 13, 2018 at 01:59 PM
3 minute read
Ever wonder what business executives in Asia, Europe, Latin America or anywhere else in the world are concerned about when it comes to business risks?
A new study based on the responses of more than 12,000 decision-makers for private companies operating in 130 economies across the globe shows that execs in different locales have some similar worries. The threat level that they attach to certain business hazards, however, varies by location.
The World Economic Forum's 2018 “Regional Risks for Doing Business” report, concludes that business leaders in North America, Europe, East Asia and the Pacific are most preoccupied with the threat of cyberattacks.
In last year's survey, cyberattacks ranked eighth overall as a business risk for execs worldwide but this year, cyberattacks climbed to fifth place.
“We look at 2017 as a tipping point for cyber-related risks, both in terms of the prevalence of attacks but also in terms of the losses that businesses have seen,” said Aengus Collins, the Geneva-based head of global risks and the geopolitical agenda for the World Economic Forum. He noted that Merck, FedEx and The Maersk Group each reported losses of around $300 million in the third quarter of 2017 alone due to cyberattacks.
Execs in the U.S. are certainly worried, according to the report, which found that cyberattacks represented the No. 1 business risk in the United States, bumping the threat of terrorist attacks, which ranked first last year, down to second place.
“Increasingly, business executives have gotten the message,” Collins said. “I think more and more companies are taking this issue very seriously.”
While cyber-intrusions are at the forefront of the minds of execs in regions with some of the world's the most advanced economies, the top concern globally was unemployment or underemployment, which speaks to “fairly fundamental economic problems,” according to Collins.
The risk of “failure of national governance” ranked as the second-highest concern among all respondents and was the top business risk for execs in South Asia, Latin America and the Caribbean. This was the second year in a row that Latin American executives said they were concerned more about the state of their government than anything else.
That “unemployment and governance failures top the list of global business risks should ring alarm bells about the strains on our basic political and economic systems,” the study states.
Another potential warning sign closer to home is that the possibility of a fiscal crises was the fourth-highest business risk for U.S. execs. Last year, fiscal crises didn't rank in the top 10 risks for stateside business execs. The study cites high federal deficits and uncertainty about the ramifications of the new tax overhaul as potential factors.
“Despite the booming economy,” Collins said, “it's clear that there's some nervousness.”
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