Aon Study Finds Business Interruption and Economic Slowdown as Top Risks in South Korea
- Written by The Bulletin
SEOUL, SOUTH KOREA - Media OutReach - 20 July 2022 - Aon plc (NYSE: AON), a leading global professional services firm, has announced the results of its 2021 Global Risk Management Survey for South Korea.
The study gathers input from thousands of risk managers globally every two years to identify key risks and challenges their organisations are facing. The past two years have proved to be incredibly volatile, with the global COVID-19 pandemic having a ripple effect across other types of risk, such as heightened awareness of reputation and cyber, as long-tail risks have become increasingly important to manage.
The 2021 edition surveyed more than 2,300 respondents in 60 countries/territories across 16 industries at both public and private companies. With more emphasis and reliance on technology, cyber risk topped the list as the number one current and predicted future risk globally, its highest rank since the inception of the survey. In South Korea, Business Interruption and Economic Slowdown topped the list in 2021, while Property Damage and Environmental, Social and Governance risks were cited as two of the projected top five risks for 2024.
The top 10 risks in South Korea strongly reflect the current landscape, namely COVID-19 and its impact on organisations amidst a backdrop of challenging market conditions: supply disruptions, delayed infrastructure projects and workforce shortages. This is testing the ability of firms to manage volatility and make better decisions. Organisations are shifting their focus from event-based to impact-based risk assessments: for example, business interruption was once seen as a linear risk, but COVID-19 and geopolitical risks have demonstrated how it can affect multiple industries and companies simultaneously and globally.
"As we see increasing volatility in South Korea, the importance of decision making has never been greater," said Kevin Kim, CEO, South Korea at Aon. "The COVID-19 pandemic has exacerbated supply risks, inflation and economic slowdown, revealing new risks and re-ordering priorities for organisations. Leaders must manage these immediate risks without compromising firms' ability to invest in managing the risks of tomorrow."
The top 10 risks for South Korea according to the 2021 Global Risk Management Survey are:
1. Business Interruption
2. Economic Slowdown/Slow Recovery
3. Corporate Social Responsibility (Environmental, Social and Governance)
4. Pandemic Risk/Health Crises
5. Increasing Competition
6. Supply Chain or Distribution Failure
7. Accelerated Rates of Change in Market Factors
8. Regulatory/Legislative Changes
9. Property Damage
10. Environmental Risk
Conducted every two years since 2007, Aon's Global Risk Management Survey provides data and insights to enable better decision making around risk in an increasingly volatile and complex business environment. The full report is available here. The report highlights the top 10 risks by industry and region, as well as risk readiness, associated losses and mitigation actions for each of the top 10 risks. In addition, the report includes the predicted top 10 risks in the next three years and Aon's analysis of underrated risks.
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