Cyber attacks top global risks, talent retention surges in Aon 2023 survey

Aon (NYSE:)’s 2023 Global Risk Management Survey, unveiled by CEO Greg Case, has identified cyber attacks and data breaches as the leading business risk worldwide. The survey collected insights from 3,000 risk managers and executives across 61 countries. Business interruption held its position as the second top risk, reflecting a growing frequency of such events affecting multiple industries and companies simultaneously.

The survey highlighted human capital issues as a significant business risk, driven by surging healthcare costs, intense competition for talent, workforce shortages, and poor retirement readiness. Notably, “attracting and retaining top talent” jumped to fourth place globally from being outside the top ten in 2021. Despite this rise in awareness, only 11% of respondents have quantified these risks, suggesting a substantial gap between risk perception and action.

Lambros Lambrou, CEO of Human Capital at Aon, warned that deficits in talent or specialized skills could limit innovation and competitiveness while increasing exposure to cyberattacks, regulatory breaches, supply chain disruptions, business interruption events, and reputational damage.

Supply chain disruptions were ranked as a significant risk due to geopolitical and economic changes. However, less than 40% of organizations have conducted supplier resilience assessments, and fewer than 20% have diversified their suppliers to mitigate this risk. This risk associated with supply chain and distribution failure hit a 14-year high in the survey.

Andy Marcell, CEO of Risk Capital at Aon, expressed concerns over the omission of climate change and AI risks from the global top ten ranking. He emphasized the immediate climate change risks including property damage, severe weather impact, natural disasters, and fallout from climate-related regulatory changes. He also underlined AI’s transformative role in reshaping enterprise risk landscapes across industries. Broad AI initiatives could heighten cybersecurity exposure and intensify human capital risks like scarcity of necessary skills.

The survey also revealed high risk readiness for cyber attacks, low reported losses of income, and high percentages of risk mitigation actions across all top ten risks. However, only two of the top five current risks are insurable, and half of the overall top ten is currently uninsurable.

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