At a glance
- In partnership with the World Economic Forum we have produced a new special report that aims to identify the emerging concerns and fallouts from COVID-19
- This report shares the views of 347 senior risk professionals who participated in the COVID-19 Risks Perceptions Survey
- Here are the key insights from the report
In partnership with the World Economic Forum we have produced a new special report that aims to identify the emerging concerns and fallouts from COVID-19 over the next 18 months, analyse the pandemic’s implications and effects beyond the immediate crisis response, and provide insights on the interconnectivity of the current risks landscape that would not otherwise be available. Download a copy of the full report here.
The perspective of the business community on these global concerns is reflected, not just in the business impact and risks, but in the broader global consequences.
We are in a healthcare crisis that is also an economic crisis and an energy crisis. The length and depth of the economic crisis will depend on solving the healthcare crisis with an exit strategy involving a combination of an effective, widely available vaccine and therapeutic drugs. What is clear is the interdependencies of the global risks triggered by the COVID-19 pandemic. We are experiencing an historic event that will change many aspects of the world we live in.
Key insights from the report
Economic shifts: Emerging risks from structural change
Respondents suggest that economic risks in general – a prolonged recession of the global economy in particular – are the most likely and concerning fallout for the world and companies over the next 18 months. A build-up of debt is likely to burden government budgets and corporate balances for many years, global economic relations could be reshaped, emerging economies are at risk of submerging into a deeper crisis, while businesses could face increasingly adverse consumption, production and competition patterns.
Sustainability setbacks: Emerging risks from stalling progress
The gravest environmental fallout for the world is a shortfall of investment in climate action: 18% of respondents identified this risk as one of the most likely risk outcomes and 16% considered it to be one of the most concerning.
Even though industrial production worldwide was cut by lockdowns and shutdowns, resulting in a sharp drop in emissions and pollution globally, COVID-19 could have severe post-crisis effects on the planet and its species. As countries start to emerge from the immediate health crisis and work on rebooting their economies, new working practices and attitudes towards traveling, commuting and consumption may make it easier to have a lower carbon and more sustainable recovery.
But omitting sustainability criteria in recovery efforts or returning to an emissions-intensive global economy risks hampering the climate resilient low-carbon transition.
Societal anxieties: Emerging risks from social disruptions
Another infectious disease outbreak is of greatest concern among societal risks for the world, according to 40% of respondents, with 30% identifying this as a likely outcome. In addition to the dangers to public health, the pandemic and resulting lockdowns and shutdowns could have long-lasting effects on people and societies.
High structural unemployment – perceived as the second most concerning risk for the world – is likely to exacerbate inequality and affect mental health and societal cohesion, in addition to its direct economic consequences. Individual and social well-being are also likely to be affected by an accelerated automation of the workforce, which 25% of respondents indicated is likely to result from the coronavirus crisis.
Technology dependence: Emerging risks from abrupt adoption
Technology has been central to the way people, companies and governments have managed the COVID-19 crisis and the contact-free economy may also create new employment opportunities in the post-pandemic world.
However, a greater dependence on technology has increased cybersecurity risks. According to 38% of the risk experts surveyed, new working patterns leading to cyberattacks and data fraud are the most likely technological fallout risk for the world. The rapid roll-out of new technology solutions has exacerbated other risks, such as digital fragmentation, privacy violations and inequality. Thus, COVID-19 is likely to challenge the relationship between technology and governance, while mistrust or misuse of technology could have long-lasting effects on society.
An opportunity to build back better.
When it comes to the socio-economic agenda, there has been a collective re-evaluation of who performs “essential work” and a new understanding of essential public services such as health, education, care and other safety nets. Countless local and international initiatives have spread online and offline to ensure that those in need receive basic goods and services.
Despite the grim economic outlook, the solidarity created by the COVID-19 pandemic offers the possibility of investing in building more cohesive, inclusive and equal societies. When it comes to the environmental agenda, the implementation of green stimulus programmes holds the potential to fundamentally change the way economies and industries operate, especially as societal behaviour change may spur more sustainable consumption and mobility habits. For businesses, the opportunity exists to accelerate a transformation towards more sustainable and digital operating models, while enhancing productivity. When it comes to the Fourth Industrial Revolution, technology has demonstrably helped societies manage the crisis and provided a window into the benefits of more technology-enhanced ways of learning, working and producing – from telemedicine to logistics to the knowledge economy. There is potential for a new era of innovation, growth and enhanced technology governance in the service of societal and environmental goals.