Amid the pandemic, increasing technological disruption, a shifting geopolitical landscape, growing social instability and the tightening of regulatory controls, G20 companies are facing an ever-growing and complex concoction of risk. Whilst each of these issues presents its own challenges, preparedness – and by extension resilience – is the key universal antidote that businesses must develop to mitigate these threats.

EXECUTIVE SUMMARY

A new era of unforgiving public scrutiny, outdated business models and the repercussions of the pandemic are some of the diverse - yet interlinked - risks that are driving major C-suite concerns today. Underpinning these concerns is an increasingly relentless pressure to withstand public, government and regulatory scrutiny; to meet growing stakeholder expectations; and to transform working practices and culture like never before.

Whilst the emergence of vaccine-resistant COVID-19 variants was the most common concern amongst all but one of the G20 countries surveyed (with 48% of companies expressing this fear), it is, in the longer term, the socio-economic issues exposed by the pandemic, along with knock-on effects, that will be of greatest concern.

With just 4% of companies surveyed stating they have no mainstream concerns about the next 12 months, almost every G20 business will need to be prepared for – and therefore resilient to – an ever-diversifying range of risks and concerns. By proactively building resilience now, companies are better positioning themselves for future growth. It is therefore reassuring that 97% of G20 companies are already investing in preparation for future crises.

ESG permeates throughout every aspect of business – from investor relations and marketing to regulation and compliance. In turn, ESG has rapidly climbed the corporate agenda, becoming a major consideration for any company’s leadership.

13%

of G20 companies believe their sustainability and ESG practices are meeting expectations in all areas

Key Stats

  • 83% of companies have increased their commitment to ESG and sustainability over the last 12 months
  • 86% of companies agree that they are  actively aligning their business strategy with social purposes
  • 30% of companies expect to be investigated by regulatory or government bodies in the next 12 months on their sustainability and ESG practices

As organisations embrace new digital working practices, new digital risks are introduced. From loss of data and intellectual property to ransomware, DDoS and phishing attacks, organisations are facing an unprecedented set of cybersecurity and data privacy challenges impacting their operations, finances and reputation.

74%

of G20 companies say that cybersecurity has risen up their board’s agenda as a result of COVID-19

Key Stats

  • 78% of companies have experienced a cyber attack in the last 12 months
  • Across our respondents, total revenue losses due to cyber attacks in the last 12 months was estimated to be over USD$265 billion
  • 25% of companies report that they had lost revenue as a result of data privacy issues in the last 12 months

With the pandemic continuing to cast a shadow over the global economy, G20 companies are taking increasingly strenuous measures to service their debts and meet their financial obligations. A potential perfect storm of stress events looms on the horizon – one that will require a longer-term preparedness and resilience to navigate.

of companies have experienced a reduction in turnover since the start of the pandemic

Key Stats

  • Since the start of the pandemic, the average G20 company estimates that it has lost 12% in revenue and 13% in headcount
  • 35% of companies say they are growing,  compared to 27% last year
  • 33% of G20 companies have sought refinancing or restructuring in the last year

The combination of the pandemic, changing consumer patterns, digitalisation and new means of working is presenting companies with unique opportunities to transform - as well as increased vulnerabilities and risk. The transformation businesses require to face these challenges and maintain competitiveness will be underpinned by a resilience based on flexibility, future planning, M&A activity and new technological tools.

of companies understand they will need to apply a hybrid working model

Key Stats

  • 80% of companies agree that their business model needs to fundamentally change in order to maintain or restore competitiveness
  • 30% of companies have experienced a shortage of talent and skills in their business over the last 12 months
  • 41% of companies are under extreme pressure to integrate technology into their working practices

The fight against financial crime is ever-evolving – especially when widespread operational disruption coincides with the emergence of new technologies. Financial services firms in particular face a multi-faceted challenge. On the one hand, their pre-existing control frameworks have been stretched to work remotely; on the other, consumer demand for crypto-asset and fintech-like services has pushed them towards integrating technologies which are ripe for exploitation by bad actors.

of G20 companies use AI and analytics to monitor for risk scenarios

Key Stats

  • 81% of companies agree that a growing numbers of criminals are exploiting the financial system
  • 25% of companies expect to be investigated in relation to their financial crime compliance in the next year
  • 47% of companies identified increased sanctions and trade restrictions as likely and concerning

Amid a shifting investigatory landscape, increased media scrutiny and a new culture of group litigation, disputes and litigation risks have become a growing area of concern. From sustainability and compliance to tax practice and data privacy, businesses are facing an ever-widening range of investigation sensitivities.

of G20 businesses are being, or expect to be, investigated in the next 12 months

Key Stats

  • 13% of G20 companies expect to be hit by class actions or mass claims in the next 12 months
    • The same proportion of companies as the previous 12 months
  • Companies expect to spend 17% of their legal budgets on settlements from class actions and other disputes

The nature of crises that companies are facing, their ability to monitor and plan for risk, and the way in which they respond to crisis scenarios are rapidly changing in an ever-shifting financial, social and regulatory world. As a result, businesses are having to be increasingly proactive in their public discourse and engagement, and are employing new crisis mitigation techniques to increase resilience.

of companies expect media scrutiny over the next 12 months

Key Stats

  • 97% of companies are already investing in preparation for future crises
  • 87% of companies believe their leaders are now better prepared for future crises
  • 46% of companies are updating their business continuity plans

PREVIOUS REPORTS

2021

DOWNLOAD

2020

DOWNLOAD

2019

DOWNLOAD