Climate change doesn’t make the cut in Aon’s 2023 Global Risk Management Survey top 10 risks

Aon’s 2023 Global Risk Management Survey has highlighted the top 10 business risks for Asia Pacific:

1.            Cyber Attacks/Data Breaches

2.            Economic Slowdown/Slow Recovery

3.            Business Interruption

4.            Failure to Attract/Retain Top Talent

5.            Rapidly Changing Market Trends

6.            Supply Chain/Distribution Failure

7.            Regulatory/Legislative Changes

8.            Increasing Competition

9.            Failure to Innovate/Meet Customer Needs

10.         Commodity Price Risk/Scarcity of Materials

Cyber breaches have jumped up the rankings since it first appeared in 2015, to take the number 1 spot. Of note, climate change didn’t make it into the top 10 business risks globally or for the Asia Pacific region. Survey participants ranked climate change 17th in terms of current global risks businesses are facing, and 12th in terms of future global business risks. However, global risk professionals rank climate change at 8th in their list of future global business risks and those in the insurance, natural resources and food, agribusiness and beverage sectors all list climate change in their top 10 current risks. As Aon points out, climate change “…directly impacts four of the top 10 risks: business interruption, changing market trends, supply chain or distribution failure and regulatory or legislative changes.”

New Zealand has been ranked the second highest natural disaster risk in the world by Lloyds of London, with the country experiencing more than 150 severe weather events and natural disasters since ICNZ began keeping records in 1968. Climate change is likely to exacerbate the frequency and severity of the weather events we experience.

Aon NZ CEO Melissa Cantell says

"With cyber risks, economic recovery and business interruption identified as the top risks organisations are facing today, there is a compelling need for a shift in mindsets around being better prepared. What is surprising are the risks that are unaccounted for in leaders' assessments of the challenges they must address, such as climate risk. Climate is not an emerging risk, but an urgent one, with increasingly monumental implications for businesses of all sizes. What leaders need now are insights from advanced analytics and modelling alongside innovative solutions that will help them make better decisions today and protect them in the future."

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