The increasing regularity of large-scale hacks has not gone unnoticed. Both cyberattacks and massive data fraud incidents now both appear in the list of the top five global risks by perceived likelihood.
That’s according to
The Global Risks Report (GPRS) 2018, an annual assessment of global risks, published earlier this month by the World Economic Forum (WEF). According to the report, large-scale cyberattacks are now ranked third in terms of likelihood while rising cyber-dependency is ranked as the second most significant driver shaping the global risks landscape over the next 10 years.
“Geopolitical friction is contributing to a surge in the scale and sophistication of cyberattacks. At the same time cyber exposure is growing as firms becoming more dependent on technology,” said John Drzik, president of global risk and digital,
Marsh. “While cyber risk management is improving, business and government need to invest far more in resilience efforts if we are to prevent the same bulging ‘protection’ gap between economic and insured losses that we see for natural catastrophes.”
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GPRS respondents have, in previous years, tended to be optimistic about technological risks, but the sheer number of cyber attacks has clearly grabbed their attention. The report found that cyber breaches recorded by businesses almost doubled between 2012 and 2017, from 68 per business to 130 per business.
“Having been choked off by law enforcement successes in 2010–2012, ‘dark net’ markets for malware goods and services have seen a resurgence,” the report said. “In 2016 alone, 357 million new malware variants were released and “banking trojans” designed to steal account login details could be purchased for as little as US$500.”
The financial impact of cyber attacks are also on the rise. The GPRS cited a 2017 study of 254 companies
across seven countries which put the annual cost of responding to cyberattacks at $16.2 million per company, a 27.4% year- on-year increase. “The cost of cybercrime to businesses over the next five years is expected to be US$8 trillion,” the report said.
Unsurprisingly, some of the largest costs last year were related to ransomware. The report found that ransomware attacks accounted for 64% of all malicious emails sent between July and September in 2017.
As in 2017, environmental risks dominated the Global Risk Perception Survey. All five environmental risks - extreme weather; biodiversity loss and ecosystem collapse; major natural disasters; man-made environmental disasters; and failure of climate-change mitigation and adaptation - were ranked highly in terms of likelihood and impact.
Alison Martin, Group Chief Risk Officer,
Zurich Insurance Group said: “Environmental risks, together with a growing vulnerability to other risks, are now seriously threatening the foundation of most of our commons. Unfortunately we currently observe a “too-little-too-late” response by governments and organisations to key trends such as climate change. It’s not yet too late to shape a more resilient tomorrow, but we need to act with a stronger sense of urgency in order to avoid potential system collapse.”
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