A prolonged global recession, job losses and another pandemic: the COVID-19 risk report reveals top concerns for business
18 May 2020
The first global pandemic in more than 100 years, COVID-19 has spread throughout the world at an unprecedented speed. At the time of writing, 4.5 million cases have been confirmed and more than 300,000 people have died due to the virus.
As countries seek to recover, some of the more long-term economic, business, environmental, societal and technological challenges and opportunities are just beginning to become visible.
To help all stakeholders – communities, governments, businesses and individuals understand the emerging risks and follow-on effects generated by the impact of the coronavirus pandemic, the World Economic Forum, in collaboration with Marsh and McLennan and Zurich Insurance Group, has launched its COVID-19 Risks Outlook: A Preliminary Mapping and its Implications - a companion for decision-makers, building on the Forum’s annual Global Risks Report.
What's the challenge?
The COVID-19 crisis has revealed the urgent need to shape a better world. As economies restart, there is a possibility to ensure greater societal equality and sustainability become part of the recovery. To ensure positive outcomes from the crisis, the immediate and longer-term emerging risks must be identified and managed effectively.
The COVID-19 Risks Outlook report identifies these emerging risks, raises awareness and triggers timely debate as governments and businesses design post-lockdown measures.
The report draws on the World Economic Forum’s 15 years of experience delivering annual Global Risks Reports, examining how risks interconnect with and shape each other. The results are a reminder of the need for proactive action today, to shape the new normal we want in a post-COVID world, rather than the one that may occur if the identified emerging risks are not addressed.
The findings suggest economic distress and social discontent may rise over the next 18 months unless world leaders, businesses and policy-makers work together to manage the fallout of the pandemic.
The crisis has devastated lives and livelihoods. It has triggered an economic crisis with far-reaching implications and revealed the inadequacies of the past. As well as managing the immediate impact of the pandemic, leaders must work with each other and with all sectors of society to tackle emerging known risks and build resilience against the unknown. We now have a unique opportunity to use this crisis to do things differently and build back better economies that are more sustainable, resilient and inclusive.
The COVID-19 Risks Outlook: A Preliminary Mapping and its Implications examines the views of nearly 350 senior risk professionals, who took part in the COVID-19 Risks Perceptions Survey. They were asked to assess 31 risks within three categories: most likely for the world, most concerning for the world and most worrisome for companies.
Analysing the results and interconnections, four significant challenges emerged from the survey as global concerns. These challenges make up the four chapters of the report.
1. Economic Shifts: Emerging Risks from Structural Change
2. Sustainability Setbacks: Emerging Risks from Stalling Progress
3. Societal Anxieties: Emerging Risks from Social Disruptions
4. Technology Dependence: Emerging Risks from Abrupt Adoption
Specifically, the report reveals that the economic impact of COVID-19 is dominating companies’ risks perceptions. Two-thirds of respondents identified a prolonged global recession as a top concern for business. One-half identified bankruptcies and industry consolidation, failure of industries to recover and a disruption of supply chains as crucial worries.
Companies are also concerned about the geopolitical disruptions to business, with more than 40% of respondents rating tighter restrictions on the movement of people and goods among the most worrisome impact from COVID-19. The third most worrisome aspect for companies, is an increase in cyberattacks and data fraud – according to 50% of respondents – as well as the breakdown of IT infrastructure and networks, according to nearly 30% of respondents.
How can you get involved?
Collaboration between the public and private sectors to date, including across our COVID Action Platform, has helped solve some of the most urgent challenges associated with the COVID-19 pandemic and they will become increasingly more important as the world rebuilds a new normal.
Companies are invited to join our work and the Forum’s platforms, managing the impact of COVID-19 across industries to shape a better future.
COVID-19 Risks Outlook: A Preliminary Mapping and its Implications