The 2023 edition of Aon's biennial survey of global risks has revealed that human capital issues are no longer simply a "people problem", but a major business risk that is fuelled by rising healthcare costs, the competition for talent, workforce shortages and a lack of retirement preparedness.
The professional services firm’s Aon's biennial Global Risk Management Survey released in November 2023 found that cyber risk and business interruption have again emerged as the top two risks while supply chain ranks at the highest level in 14 years.
The survey gathered input from around 3,000 risk managers, C-suite leaders and other executives from 61 countries and territories to identify their most-pressing business challenges.
Aon CEO Greg Case said, "Through the use of advanced analytics and more integrated risk capital and human capital capabilities, we're helping clients quantify, manage and match capital to the risks they recognize today as we innovate on their behalf to serve their future needs."
In 2023, "attracting and retaining top talent" risk ranked fourth globally, after not breaking the top 10 in 2021, demonstrating a shift in how risk managers are viewing human capital today. Still, only 11% of the survey respondents indicated they have quantified their people risks, illustrating a significant gap between risk awareness and risk preparedness.
Despite warnings and headlines, climate change and AI are notably missing from the global top 10 ranking, suggesting a lack of awareness about the potential impact of these issues on the corporate risk profile.
Cyber attacks and data breaches remain the top risk in this year's survey and also show the highest level of risk readiness. Consistent with that, the top risk has one of the lowest reported losses of income and one of the highest percentages of risk mitigation actions across all top ten risks.
Risk of business interruption remains at number two, reflecting the reality that business interruption events are increasing and can affect multiple industries and companies simultaneously.
Overall, the top ten global risks according to the 2023 Global Risk Management Survey are:
Cyber attacks/ data breach
Business interruption
Economic slowdown/ Slow recovery
Failure to attract or retain top talent
Regulatory/ legislative changes
Supply chain or distribution failure
Commodity price risk/Scarcity of materials
Damage to reputation/ brand
Failure to innovate/Meet customer needs
Increasing competition
Source: asiainsurancereview.com
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