Also in this category, three risks stand out as having intensified the most since 2014 in terms of likelihood and impact. These are interstate conflict with regional consequences, weapons of mass destruction and terrorist attacks.
The risk landscape in 2015 also shows that there remains concern over the world’s ability to solve its most pressing societal issues, as societies are under threat from economic, environmental and geopolitical risks. Indeed, the societal risk accounts for the top two potentially impactful risks.
Also noteworthy is the presence of more environmental risks among the top risks than economic ones. This comes as a result of a marked increase in experts’ negative assessment of existing preparations to cope with challenges such as extreme weather and climate change, rather than owing to a diminution of fears over chronic economic risks such as unemployment and underemployment or fiscal crises, which have remained relatively stable from 2014.
In addition to assessing the likelihood and potential impact of these 28 global risks, Global Risks 2015
examines the interconnections between risks, as well as how they interplay with trends shaping the short- to medium-term risk landscape. It also offers analysis of three specific cases which emerge from the interconnections maps: the interplay between geopolitics and economics, the risks related to rapid and unplanned urbanization in developing countries and one on em
On urbanization, the report considers how best to build sufficient resilience to mitigate the challenges associated with managing the world’s rapid and historical transition from predominantly rural to urban living.
“Without doubt, urbanization has increased social well-being,” said Axel P. Lehmann, Chief Risk Officer at Zurich Insurance Group. “But when cities develop too rapidly, their vulnerability increases: pandemics; breakdowns of or attacks on power, water or transport systems; and the effects of climate change are all major threats.”
The rapid pace of innovation in emerging technologies, from synthetic biology to artificial intelligence, also has far-reaching societal, economic and ethical implications. Developing regulatory environments that are adaptive enough to safeguard their rapid development and allow their benefits to be reaped, while preventing their misuse and any unforeseen negative consequences is a critical challenge for leaders.
“Innovation is critical to global prosperity, but also creates new risks,” said John Drzik, President of Global Risk and Specialties at Marsh. “We must anticipate the issues that will arise from emerging technologies, and develop the safeguards and governance to prevent avoidable disasters.”