Sustainability risks are the top long term organizational concern finds FERMA survey
- Published: Tuesday, 31 May 2022 08:09
FERMA has released the results of its 2022 European Risk Manager Survey conducted in partnership with PWC France. The Survey has taken place every other year since 2001/2002 and this is the first one to be completed since the pandemic. There were more than 500 responses from 27 countries.
The current and emerging risk landscape
The biggest threats for businesses in 2022 are linked or amplified by the global pandemic and Ukrainian crisis: cyber threats, supply chain & disruption failure, geopolitical uncertainties, and uncertain economic growth notably with the increase in raw material, energy costs, and the issue of their availability as well as the inflation.
Cyber attacks continue to be at the top of mind in the short (12 months) and medium-term (3 years), while risks related to sustainability are two of the top three risks in the long term (10 years) with climate change the number 1 risk and natural disaster risks at number 3.
Results show that a ‘triple crunch’ in buying insurance protection is currently facing risk managers:
- 78 percent are heavily impacted or face a major impact in terms of increase in premium
- 71 percent are heavily impacted or face a major impact in terms of reduction in capacity
- 63 percent are heavily impacted or face a major impact in terms of limitations and exclusions on specific risks.
As a consequence, risk managers are adapting their insurance strategy, with 73 percent focussing on risk retention.
In addition, 41 percent of the respondents believe that some of their company’s activities or locations will become uninsurable in the future illustrating the growing difficulty to insure risks that are seen as systemic (e.g.. cyber, climate change).
Developments in the risk management profession
91 percent of risk managers are involved in corporate strategy either fully, mostly, or partially.
A growing number of risk managers are playing or planning to play a specific role regarding ESG-related risks in their organizations (56 percent against 40 percent in 2020) and 82 percent collaborate with the CSR/Sustainability department with 32 percent having a close interaction against 20 percent in 2020.
More than half the risk managers work closely with IT and information security on cyber risks or have it within their team. More than one-third of risk managers are directly involved in the management of risks related to the adoption of new technologies by their organization.
Read the survey report (PDF).