COVID Report, February 2021
COVID-19 has tested businesses on all fronts – it has transformed the way we work, learn, consume, communicate and much more. And despite the unprecedented government stimulus packages supporting economies across the globe, our global economy remains in distress – from negative GDP growth to rising unemployment rates and unparalleled levels of government debt.
The Resilience Barometer COVID Report examines the impact these trends and others have had on large businesses in G20 nations within the context of the pandemic, and the actions they are driving across their enterprise to plan for what is next and position their businesses to emerge even stronger.
C-SUITE CONCERNS A MEASURE OF PREPAREDNESS
If 2020 taught businesses anything, it is that the risks they face extend far beyond the fluctuations of their particular industry or ecosystem. Global CEOs are concerned not just by market developments, but by geopolitical shifts, social movements, and the accelerated digital transformation of global commerce.
The pandemic was naturally the dominant concern, affecting every aspect of the world economy – but CEOs also found themselves called to action on issues such as climate change, social justice and diversity.
Geopolitical changes are also high on the agenda as supply chains and business continuity risk being impacted by changes in trade relations between the US and China, Brexit, and increased fragmentation around the world.
More than any other crisis in recent memory, the pandemic has put huge pressure on business leaders. Irrespective of financial performance, CEOs have had to grapple with the human cost, be that to their employees, their companies or their communities. Business continuity has hinged on making immensely difficult decisions, and will continue to do so in 2021. Whole divisions have been shuttered, and many have watched years of hard work vanish due to circumstances beyond their control.
INVESTIGATIONS & DISPUTES PREPARING FOR RISK
of G20 companies saw an increase in regulatory breaches and investigations in 2020 or expect to see one in 2021
CYBERSECURITY & CRISIS RESILIENCE REQUIRES PROACTIVITY
For many companies, COVID-19 has stretched their crisis preparation and response procedures to the limit and beyond. As workforces have shifted to digital environments, risk and crisis preparation is becoming increasingly relevant in the cybersphere. The growth of digital ecosystems has forced comprehensive adoption and integration of technologies, which is fraught with risk – across G20 respondents, an estimated $18bn of revenue was lost as a result of cyber attacks in 2020. As their digital capabilities grow, resilient businesses must also build trust in those capabilities.
SUSTAINABILITY: ENGAGING FOR GROWTH
Whether due to the global health pandemic, the climate and biodiversity emergency, widespread social inequality or demand for transparent and accountable corporate governance, the global case for a genuinely sustainable model has come of age.
of G20 companies see COVID-19 as a catalyst to accelerate or materially enhance their approach to ESG and sustainability
the top three
reported issues are:
- Pay gaps | 76%
- Climate change | 75%
- Corporate purpose and resilience | 74%
OPERATIONAL & FINANCIAL RESILIENCE: WITHSTANDING DISRUPTION AND SHOCKS
Resilient organisations must be able to withstand disruption and shocks, both internally and in their external markets. Before COVID-19, many businesses were already facing major structural challenges, many of which have now been amplified by the pandemic and have required businesses to make rapid changes to both their capital and operational structures.
of G20 companies have taken steps to restructure or refinance
of G20 companies agree that supply chains have been permanently disrupted by COVID-19
TRANSFORMING BUSINESS MODELS: PREPARING FOR THE NEW NORMAL
The latest quarterly FTI Resilience Barometer™ report incorporates the views of 2,185 decision makers in large companies across all G20 countries. The quantitative survey was conducted in October 2020, and respondent profiles replicate those used in the previous years’ research.
Each country’s results have been weighted so that they represent a similar proportion in the total G20 results. The results were also weighted so that the industry breakdown of each country is similar to the breakdown of the 2020 Resilience Barometer™.
The majority of respondents were C-Suite and senior executives from privately owned companies, while 21% were from publicly listed entities.
Reported global turnovers as compared to our January 2020 report have highlighted a decline, as a result of the pandemic. Respondents reported an average global turnover of $13.7bn over the past 12 months (January 2020 report: $17.4bn). Companies reporting a global turnover of more than $100bn made up 5% (January 2020 report: 7%). In total, participating companies employ a global sum of 38 million people, employing an average of 17,287 (January 2020: 23,336).
Respondents were classified according to industry, with Technology and Communications (26%); Consumer Goods (19%); Financials (14%) and Services (10%) making up the bulk of the sample.