APAC expert says WEF report highlights geopolitical, digital and demographic perils
It is critical for companies to take a longer-term view on risk, despite short-term financial pressures and expectations from shareholders, the head of Marsh Risk Consulting in Asia Douglas Ure has told StrategicRISK.
Ure was speaking to SR following a special presentation and panel discussion held for executives and board directors at the Fullerton Hotel in Singapore last week.
The event was organised to examine Global Risks 2014, which is latest edition of an annual report produced by the World Economic Forum and released ahead of its meeting held in Davos, Switzerland each January. It is a study of the most significant global risks facing the global economy in the upcoming year and describes changes occurring in the global risks landscape.
Ure said the report was a great tool and guide for companies looking to assess or re-assess their long-term risk exposures. “Creating an opportunity for long-term risk discussions is important, and this report helps companies do just that,” he said.
The report highlighted some very important risk issues, Ure added. “We’ve focused on three in our discussion with clients: geopolitical risk, digital disintegration/cyber, and generation lost/youth unemployment,” he said.
“All three risk issues are happening now in some form, which means companies can’t wait to put in place mitigation strategies.”
The presentation and panel discussion was hosted by Marsh & McLennan Companies, the National University of Singapore (NUS), Swiss Re Corporate Solutions and Zurich Insurance, with panellists including the chief risk officer at DBS Bank Elbert Pattijin, director of the NUS Risk Management Institute Jin-Chin Duan, Zurich’s chief risk officer for general insurance Steve Wilson, and head of government affairs in Asia at Swiss Re Patrick Andreatta.
Ure (pictured here giving his presentation) provided some practical recommendations for corporations on how to cope with a more fractured geopolitical environment. Global companies needed to be resilient to potential shocks and reversals, Ure said, and could assist with this by diversifying investment across countries, pursuing joint ventures to access emerging opportunities, mitigating intellectual property risk and preparing for potential crisis situations.
The audience was encouraged to consider whether their own organisations were adaptive to changes in workforce demographics. “How can business influence what universities teach so we have job-ready graduates?” Ure asked. “Have we considered what new skills we need, and has there been sufficient investment in workforce planning?”
Ure provided an action plan for corporates to consider when managing risks. It includes listing the top five risks facing an organisation and working out what its risk appetite suggests with respect to managing them, working out the exposed assets and how vulnerable they are, and considering the options that could address these risks relative to what is being done at present.
The Global Risks 2014 report can be read in full at reports.weforum.org/global-risks-2014