Bad news if you were hoping 2016 will be an improvement on this year: businesses are going to be facing the 'highest level of risk in a decade' (yes, apparently that includes the financial crisis too). That's according to a global risk map put together by consultancy firm Control Risks.
Apparently the worldwide risk outlook stands at eight out of ten – you can thank China’s economic slowdown, terror attacks and hacking for that. When it comes to British businesses specifically, you’ll be unsurprised to learn that cyber attacks remain a particular thorn in their side.
Control Risks found that the number of targeted criminal cyber attacks doubled over the past 12 months, while politically motivated hacking attacks also rose by 56%. No wonder recent research showed that security specialists are reaping the rewards, charging upwards of £10,000 a day as executives scramble to up their protection. Nice work if you can get it – as Control Risks would tell you.
‘The number of hacking attacks has increased over the past year and the fear is in boardrooms that they are ill-prepared to deal with it,’ said Richard Fenning, the firm's CEO. There's a ‘generational issue, particularly with public companies, that most of the people who sit round the boardroom table are at a disadvantage in trying to understand it,' he added. Perhaps Britain's stale old boards need an injection of new blood?
Other problems which have soured the global risk outlook include the strengthening of ISIS and uncertainty over China’s ability to adapt to slower growth. On the plus side, Fenning suggested that with President Xi and his senior team at the helm, the Chinese leadership ‘are the most competent group of people to be running that country, probably ever’, and would be able to push through the tough period.
The back and forth over Britain’s membership of the EU and bubbling political tensions in the Middle East were also cited as concerns to businesses. Fear not though, this isn’t cause for total despair – the success of multilateral diplomacy following the landmark Iranian nuclear deal and the restoration of US ties with Cuba were mentioned as causes for optimism.
And hey, things could be worse. Businesses today face lower risks than at the start of the Risk Map some 40 years ago when firms had to work against an oil crisis, heightened tensions in the Middle East and the Cold War. ‘Compared to then we are in much better shape,' Fenning said. 'We are healthier, we’re wealthier and most of us are safer.'