Respondents recognize that reality, with two-thirds of our respondents rating this risk as a significant impact risk concern for 2020. Leaders of organizations of virtually every size, industry and geographic location are reminded all too frequently that they operate in an increasingly risky world. The COVID-19 crisis provides a concrete illustration of the growing connectivity of risks, which AXA presented as one of the main findings of last year’s report. The “new normal” has become a cliché for the world we are feeling our way towards. This is not hubris or “We told you so”. Antifa. Respondents continue to perceive that significant operational challenges may arise if organizations are unable to build and sustain a workforce with the skills needed to implement their growth strategies, forcing them to consider alternative forms of labor. Accidental missteps in how organizations handle these operations may inadvertently reveal information deemed to be private or proprietary. As the expanding digital economy enables businesses and third-party organizations to house sensitive information obtained in many ways, the potential exposure of that information raises such questions as how much data is too much data, does the organization need effective guardrails around data collection to manage its risk, and is the monetizing of the data collected delivering a return on investment that makes the risk of collecting and managing the data worthwhile? Airmic 1st July 2020. Activists are taking to the digital streets in large numbers as physical restrictions and violent repression make cyber activism an increasingly effective tool for projecting opinions. This website uses anonymous cookies to improve your experience of our website. This is a concern for most respondents, with some exceptions noted below. Jim has been appointed to the NACD Directorship 100 list from 2012 to 2017. www.corporatecomplianceinsights.com/implications-technical-debt/, Remote Compliance: Managing InfoSec Audits from a Distance, Risk Management and AI: A Regulatory Path Forward, Implications of India’s New Labor Law Codes, 5 Steps to Implement a Sanctions Compliance Program, Proactive Monitoring: A Sound Approach to Compliance. As 2020 has already shown, five months is an eternity: there is still a long road before 3 November. For each of the 30 risk issues, we computed the average score reported by all respondents. Not surprisingly, information security and cyber remained the top risk for 2020. Working at Height. Regulatory change and heightened regulatory scrutiny impacting operational resilience and production and delivery of products and services (4). These are where cyberattackers inject code into a website — … 3 Theft and fraud. One important observation, consistent with prior years, is that there is variation in views among boards and C-suite executives regarding the magnitude and severity of risks for 2020. Now, the greatest risk resides in the short term, which remains full of unknowns. If organizations cannot adjust their operations, legacy IT infrastructure and digital capabilities (as discussed above), they may not meet the expectations of their core customers in a manner sufficient to retain their loyalty. But it also includes a technological side, such as robotic process automation and AI-enabled technologies that both displace existing skills and demand new skills. A reckoning awaits. Whatever the reason, the number of instances in which an organization’s leaders are unaware of internally caused, reputation-damaging risks and surprises until the point of revelation is troubling. His opponent – former vice president Joe Biden – is gaining simply by standing still. Each of them remains acutely valid, and even more vivid. 2019 and the early days of 2020 revealed a world … 2020 is a tipping point. Culture may not encourage timely escalation of risk issues (9). While the overall global economy remains relatively strong, there has been growing speculation – particularly in the United States – that the long streak of economic growth may stall in the near term. , 1. Risk outlook: the world in 2020. Years of simmering populism, nationalism and protectionism were never going to build the sort of trust and transparency countries need to work effectively with each other in a time of crisis. This vital specialized knowledge and subject-matter expertise are in high demand and becoming harder to acquire and retain on a cost-effective basis. With a few exceptions, autocracies and democracies have fumbled at least some aspects of their pandemic responses – they both confused and exasperated their populations and their business communities. Many governments moved to fight the pandemic alone, with transactional deals in place of a collaborative global response. Which companies laid off workers, and how many? Companies with global footprints will themselves have to become leaders in navigating a minefield of conflicting political priorities, regulatory regimes and pandemic de-escalation. That’s why, for the seventh consecutive year, AXA has conducted its annual survey of emerging risks. Previous waves of crisis – the global financial crash of 2008, for example – at least brought a coordinated response among key financial centres and their markets and regulators. 8. Watch all of them, with an eye toward their political longevity. Now that there is more time – and space – for criticism, we are seeing a much sharper picture of government instability with roots in politics, economics or both. Perhaps there was no other way. Risk.net staff @riskdotnet 04 Mar 2020; Tweet . The unprecedented alignment of capability and intent set 2020 up to be the year when we would see a large-scale attack on critical infrastructure. The Trump and Biden campaigns will continue to accuse each other of being soft on China, while the administration and Congress will stack pressure on Beijing up to and beyond the election. This remains the case, and the list is growing. There is some comfort to be taken in this landscape of uncertainty. The distant, unknowable future usually holds the greatest risk; our comfort zone is the short term, where nothing hides out of sight. This finding suggests the need for dialogue at the highest levels of the organization to ensure everyone agrees on the most critical enterprise risks. In 2020, US political institutions will be tested as never before, and … Recent concerns about the overall strength of the global economy, particularly in light of the ongoing Brexit debate between the United Kingdom and European Union, uncertainties over global trade discussions, declines in certain manufacturing sectors, and a general reduction of growth in major economies have clearly heightened this risk for 2020. Facebook . Even when executives are aware of emerging technologies that obviously have disruptive potential, it is often difficult to clarify the implications of the vision or foresight that anticipates the nature and extent of change — particularly if the organization does not think or act digitally at its core. Prior to the pandemic, a number of countries presented a volatile mix of political instability and economic vulnerability. The geopolitical turmoil the pandemic has sparked will see cyber operations – always inexpensive and easy to deny – spike as a tactic. Broadly speaking, we do not believe the pandemic has created substantial new categories of risk. Both companies and governments should expect to be grilled for their pandemic management tactics. Our organization’s … Cyber incidents. In the past, it might have sufficed to adopt a somewhat defensive or reactive approach to manage these risks. Geopolitical & macroeconomic leads the emerging risks Succession challenges and talent acquisition and retention (2). This is no longer tenable. The overarching concern relates to how different types of regulatory requirements and oversight may lead to disruptions in business models and constrict companies’ ability to innovate in certain areas. This reality is one that no management team or board can ignore. And a world waiting for the US to elect – or re-elect – a president will not wait idly on the side lines. This is the case for countries that have enacted budget-busting bailout programmes. 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