TEAM FOCUS: RISK ADVISORY SERVICES
GLOBAL RISK LANDSCAPE 2021 THE ART OF THE UNKNOWN
which are more receptive to risk-taking. More than simply protecting against the negative impacts of a crisis, effective risk management also enables companies to identify new opportunities. The effectiveness of formal risk management practices can be enhanced by technology. Only 11% of companies we surveyed currently use technology to forecast future potential risk. However, we have seen increased investment in technology during the pandemic, including digital transformation initiatives and data analytics. Linking these investments with risk management could help businesses cope better, or even thrive, when the next crisis comes.”
Nearly half of global businesses say
Regardless of sector, people pressures came to the fore. When asked which risks caused the greatest pressure during the pandemic, 45% of executives cited low employee satisfaction and wellbeing, ahead of employee productivity. Many individuals faced new challenges, including a sudden switch to remote working, requiring employers to develop new ways to keep teams engaged, motivated and feeling supported. The environment of prolonged uncertainty and rapid change created by the pandemic also challenged existing risk management practices: 90% of executives say the events of 2020 have triggered their organisation
(25%), while double the number (52%) of risk- averse firms said they had experienced worse impacts than anticipated. Having an appetite for risk can therefore provide some defence against a crisis. In contrast, the research found that organisations with a strong blame culture can be slower to respond effectively. The survey reveals differing experiences across sectors. The professional services sector was affected less than others, with just 3% describing the impact of the pandemic as much worse than expected. Manufacturers also coped relatively well, with many adjusting their business models to make essential products such as personal protective equipment or ventilators.
COVID-19’s impact was worse or much worse than expected,
although businesses that welcome risk coped better during the pandemic. These are some of the key findings of our sixth annual Global
Risk Landscape report. BDO’s survey of 500
C-suite executives across Europe, the Middle East, Africa, Asia-Pacific and the Americas shows that nearly half (48%) of companies found the pandemic to have been worse or much worse than expected. Among businesses that welcome risk, this percentage falls to a quarter KEY HIGHLIGHTS: WE ENCOURAGE YOU TO INTERACT WITH THE DATA BEHIND OUR REPORT AND EXPLORE MORE HIGHLIGHTS, INCLUDING THE TOP BUSINESS RISKS IN 2021.
to re-evaluate its risk framework entirely.
The global pandemic has reinforced the need for companies to future- proof themselves in order to mitigate disruption in times of crisis. Businesses must be ready to react and adapt to uncertainty, and those which manage this most effectively are those
NIGEL BURBIDGE GLOBAL CHAIR, Risk Advisory Services
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