Brokerage giant Aon has revealed the top global business risks, which are being shaped by technological advancements including social media, along with economic and geopolitical trends.
Aon’s 2017 Global Risk Management Survey shows damage to reputation/brand as the top-ranked risk by 1,843 respondents at public and private companies from around the world.
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Cybercrime has dramatically risen in the ranks from ninth to fifth this year and has become the top concern among business in North America amid the increasing frequency of cyber breaches.
Political risk/uncertainties has re-entered the list of top risks at number nine, as politically stable developed nations become new sources of volatility and uncertainty for businesses.
The Aon report notes that many new driving factors are exacerbating traditional risks, adding new urgency and complexity to old challenges.
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“Take ‘damage to reputation’ as an example. Over the past few years, while defective products, fraudulent business practices or corruption continue to be key reputation wreckers, new media technologies have greatly amplified their negative impact, making companies more vulnerable,” the Aon report says.
“In the age of Twitter or viral videos, damage to reputation could occur because of an inappropriate tweet by an executive, or a video by an employee complaining about sexual harassment or discrimination. On a related note, fake news, which started as a way to influence elections on social media, has begun to spill over to the corporate world.”
According to Aon, businesses can no longer rely on their usual risk mitigation or risk transfer tactics as traditional risks evolve.
“They must take a cross-functional approach to risk management and explore different ways to cope with these new complexities,” says Aon Global Risk Consulting CEO Rory Moloney.
“We are living in a challenging new reality for companies of all sizes around the world. There are many emerging influences that are creating opportunity, but at the same time, creating risks that need to be managed.”
