Sustainability Risks Top Long-Term Organizational Concern, FERMA Survey Finds
- Posted: Tuesday, May 31, 2022 8:09 AM
FERMA has published the results of its 2022 European Risk Manager Survey conducted in partnership with PWC France. The survey has taken place every two years since 2001/2002 and is the first to be completed since the pandemic. There were over 500 responses from 27 countries.
The current and emerging risk landscape
The biggest threats to businesses in 2022 are linked or amplified by the global pandemic and the Ukraine crisis: cyber threats, supply chain failure and disruptions, geopolitical uncertainties and uncertain economic growth especially with the increase in raw materials, energy costs and the question of their availability as well as inflation.
Cyberattacks continue to be the focus of concern in the short (12 months) and medium term (3 years), while sustainability risks are two of the top three long-term (10 years) risks along with climate change risk number 1 and risks of natural disasters at number 3.
The results show that a “triple crunch” in the purchase of insurance protection is currently facing risk managers:
- 78% are heavily impacted or face a major impact in terms of premium increase
- 71% are heavily impacted or facing a major impact in terms of reduced capacity
- 63% are heavily impacted or facing a major impact in terms of limitations and exclusions on specific risks.
As a result, risk managers are adapting their insurance strategy, with 73% focusing on risk retention.
In addition, 41% of respondents believe that certain activities or sites of their company will become uninsurable in the future, illustrating the increasing difficulty in insuring risks considered systemic (eg cyber, climate change).
Evolution of the risk management profession
91% of risk managers are involved in the company’s strategy either fully, mainly or partially.
A growing number of risk managers play or plan to play a specific role regarding ESG-related risks in their organizations (56% compared to 40% in 2020) and 82% collaborate with the CSR/Sustainability department, 32% having close interaction with 20% in 2020.
More than half of risk managers work closely with IT and information security on cyber risks or have it on their team. More than a third of risk managers are directly involved in managing the risks associated with the adoption of new technologies by their organization.
Read the investigation report (PDF).