Davos Agenda

These are the biggest risks facing the world 

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Sophie Heading
Lead, Global Risks, World Economic Forum
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Davos Agenda

This article is part of: World Economic Forum Annual Meeting

Listen to the article

  • The latest edition of the World Economic Forum's Global Risks Report is out on 11 January 2023.
  • Rewatch the livestreamed briefing above.
  • Hear the Radio Davos podcast.

Join us for the launch of the Global Risks Report 2023 to hear from world-leading experts about the major risks the world will be facing in the coming years. The Global Risks Report 2023, developed in collaboration with Marsh McLennan and Zurich Insurance Group, is part of the World Economic Forum's Global Risks Initiative.

Speakers:

Saadia Zahidi, Managing Director, World Economic Forum

Carolina Klint, Risk Management Leader, Continental Europe, Marsh

John Scott, Head of Sustainability Risk, Zurich Insurance Group

Moderated by:

Adrian Monck, Managing Director, World Economic Forum

At the launch of the report in London, leading experts set out the major risks the world is facing right now - and up to a decade into the future. They also shared insights on how best we can mitigate the economic, political and social threats arising from these risks.

Opening the discussion, Saadia Zahidi, Managing Director at the World Economic Forum said: “Today, the energy crisis is at the very top of the risk register, followed by the food crisis and the cost of living. Two years out, though, the experts are still expecting that the cost of living is going to be the number one risk on the global agenda. Ten years out, six of the top 10 global risks are dominated by climate and the environmental risks and the risks associated with that, such as large-scale involuntary migration.”

Global Risks Report 2023 Top 10 Risks
Global Risks Report 2023 Top 10 Risks Image: World Economic Forum

John Scott, Head of Sustainability Risk at Zurich Insurance Group, shared his concerns about the lack of progress on climate change highlighted in the report.

“This year, the failure of climate change mitigation is one of the most highly rated risks. Even more concerning… it's one of the risks that is least prepared for, with over 70% of respondents to the global risk perception survey, rating mitigation of climate change as ineffective.”

Scott was concerned that short term thinking from politicians could lead to more significant climate threats in the future.

“We're living in a world right now where what's scientifically necessary, and what is politically expedient don't match. It feels like we're heading towards a much slower and more disorderly climate transition in reality.”

Scott called for more public/private cooperation on climate mitigation.

“Solving climate change is the ultimate team sport. It isn't just coming from one sector. It has to be governments, it has to be business, it has to be the finance sector to work together to really address these complex and systemic issues.”

Tackling energy-related risks

Russia’s invasion of Ukraine plunged Europe into a major energy crisis and set inflation on an upward spiral, pushing up the cost of living and creating a food crisis that spreads far beyond Europe.

Carolina Klint, Risk Management Leader, Continental Europe, at Marsh shared her concerns about the possible repercussions of these connected crises.

“No country is immune to social erosion caused by lack of affordability and availability of basic necessities - and that's really important for us to recognise. Cost of living pressures and food insecurity could provoke civil unrest and instability.”

Klint shared John Scott’s concerns that a focus on the short term could lead to bigger problems down the road.

“Secure energy is of course also crucial for supply chain resilience. Many countries have increased their reliance on coal to keep lights on and factories running. In all of this, we have to remain committed to long term climate ambitions.”

Klint urged leaders to keep one eye firmly on the future as they tackle the immediate problems facing their countries.

“We need to take a step back and start planning for the unexpected. I think generally speaking, most of the things that we worry about are too short term and modest. So, take a long term and holistic view at the risks on the horizon. I do think that if we work together, we are able to prepare for and respond to these compounding risks with better agility.”

A challenge to global leadership

The Global Risks Report 2023 suggests the cascading crises facing the world are not going away any time soon. Saadia Zahidi said the report shows leaders are preparing for a long road ahead but there is optimism that the crises will recede in the longer term.

“Leaders are facing multiple crises that are happening at the same time, so essentially, a polycrisis. When we asked leaders what they're expecting to happen, well over 80% said that we're looking at consistent ongoing crises that are compounding each other on an increasingly volatile trajectory. Although 10 years out, we're looking at that number going down to about 50%."

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