Business disruption, epidemics and cyber incidents

The 10th Allianz Risk Barometer, the annual survey of global business risks conducted by Allianz Global Corporate & Specialty (AGCS), has been released. According to the survey, the biggest risk to the global business world was business disruption, while the epidemic ranked second and cyber events ranked third. The epidemic, which rose to 16th in the past 10 years, was listed as the number one risk in 16 countries by 2021. In the Allianz Risk Barometer 2021, which emphasized the interconnectedness of the risks of business interruption, epidemics and Cyber ​​attacks in parallel with Covid-19, attention was drawn to the increasing vulnerabilities of our highly globalized world.

The 10th Allianz Risk Barometer, the annual survey of global business risks conducted by Allianz Global Corporate & Specialty (AGCS), has been released. In the study, which included the opinions of 2,769 experts from 92 countries and regions, including CEOs, risk managers, brokers and insurance experts; Business disruption, pandemic and cyber incidents were mentioned as the top three business risks for 2021, strongly interconnected. Business interruption was the highest business risk with 41 percent in the survey, while epidemic ranked second with 40 percent and cyber incidents ranked third with 40 percent. The “epidemic”, which rose from 17th to 2nd among business risks, was the main cause of business cuts in 2021. In the study where the “cyberattack” occurred just after the “epidemic”, it was noted that the companies are trying to reduce risks in their supply chains and increase business continuity management for extreme events.

According to the 10th Allianz Risk Barometer, market performance ranked 4th, macroeconomic performance 8th and political violence 10th are among the growing risks. On the risk barometer, where natural disasters (17 percent) fell from fourth to sixth, total losses from multiple minor events such as wildfires or hurricanes caused widespread devastation and significant damage in 2020, but only like Hurricane Harvey. in 2017 it was noted that it was the third year in a row without a major event. On the other hand, climate change (13 percent) fell to ninth place in this year’s study. However, with 2020 being the hottest year on record, the need to combat climate change remains as high as ever and will be a priority again in 2021.

Risk management and business continuity should further improve

AGCS CEO Joachim Müller stated that the coronavirus pandemic is a reminder that risk management and business continuity must be further improved for companies to be prepared and survive difficult events. Müller said: “In the Allianz Risk Barometer 2021, the trio of risks related to Covid-19 appears to be dominant. The risk of business interruption, pandemic and cyber attack is strongly interconnected, illustrating the growing vulnerabilities of our highly globalized and connected world. As the pandemic continues to squeeze countries around the world, we must also prepare for more common extreme scenarios, such as a global cloud outage or cyber attack, natural disasters caused by climate change, and even another epidemic. ” .

The risks caused by climate change are also a priority, such as an epidemic.

The CEO of Allianz, Tolga Turkey Gürkan, the Allianz Group announced that it performs every year to assess the Risk Barometer; He noted that the epidemic, which never ranked above 16 in 10 years on the Allianz Risk Barometer before 2021, was shown as the number one risk in 16 countries by 2021. Gürkan said: “While the epidemic is Among the three highest risks on all continents, it was the first risk in 35 of 38 countries where the analysis of the top 10 risks was performed. The risks derived from climate and environmental change and natural disasters are also among the top 10 in the ranking. The report notes that climate change will be on the agenda as a priority in 2021. Today, risk perception, risk-oriented measures and actions are changing. Now we are entering a period in which companies that create value and manage all business processes not only in the economic dimension but also environmental and social, come to the fore, and the companies that lag behind feel this deficiency more. The pandemic also manifested itself again; From now on, all companies must review each business process from a perspective that covers all dimensions of ESG. “He spoke.

It ranked fourth on the 2021 Allianz Risk Barometer at 19 percent, “market developments “it reflects the risk of increased financial failure rates after the epidemic. According to Euler Hermes, the jump in the rates of financial insufficiency will begin in the second half of 2021, with the gradual end of the measures to support companies. In 2022, insufficiency rates are projected to increase by 12 percent worldwide and by 17 percent in the euro zone. Prior to the Covid-19 outbreak, seven times to the top of the Allianz Risk Barometer and delivered to cyber incidents in 2020 business interruption, It returned to the top again in 2021. The epidemic shows that the extraordinary events of business disruption that occur globally are not just theoretical, but a real possibility, causing revenue losses and disruptions to production, operations and supply chains. 59 percent of respondents cite the epidemic as the leading cause of work stoppage in 2021. This cyber incidents, natural disasters with fire and explosion He is watching. In response to growing business interruption vulnerabilities, many companies are aiming to establish more flexible operations and reduce risk in their supply chains. According to participants in the Allianz Risk Barometer, improving business continuity management is the main action companies take. This is followed by the development of alternative or multiple suppliers, investment in digital supply chains, and improvement in supplier selection and auditing. According to AGCS experts, the plans of many companies have been disrupted by the pace of the epidemic. In the studio, business continuity planning should be more holistic, cross-functional, and dynamic; It was emphasized that it should monitor and measure emergent or excessive damage scenarios, be constantly updated and tested, and be included in an organization’s strategy.

Cyber ​​risks intensify

In Allianz’s 10th Risk Barometer, it was emphasized that although cyber incidents fell to third place, they continue to be a significant risk with more participants compared to 2020. Cyber ​​incident risk remains among the top three risks in many countries as Brazil, France, Germany, India, Italy, Japan, South Africa, Spain, the United Kingdom and the United States. In the study, “macroeconomic developments” (13 percent) rose to eighth place this year. Tenth place “Political risks and violence” (11 percent) entered the top 10 for the first time since 2018.



Source: Allianz Global Corporate and specialized


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