80 Percent of Risk Leaders Doubt Resilience to Emerging Risks by 2034

Only 20 percent of key decision-makers and their teams believe their organizations are adequately prepared to tackle emerging risks over the next decade, according to WTW's Emerging and Interconnected Risks Survey: Navigating a Complex Risk Landscape. The study also found that half of respondents are confident in their organization's ability to manage today's risks effectively.

The survey, conducted by WTW Research Network, analyzed responses from 333 professionals across 55 countries, representing 14 industries including transportation, financial services, and natural resources. Collectively, these organizations employ 1.3 million people and generate $2.3 trillion in revenue. Participants included senior leaders, implementation teams, and broader employee groups.

The study introduced a risk taxonomy of 48 risks across 8 categories and guided respondents to assess risks across four perspectives: current, near-term (next 2 years), long-term (next 10 years), and interconnectivity.

Key Findings

• Technology. Artificial intelligence, cyber risks, and technological advancements dominate today's and tomorrow's risk concerns. Technology is expected to drive significant change over the next decade.
• Geopolitical Volatility. Geopolitical issues such as societal cohesion, electoral dynamics, and misalignments between government and business remain pressing concerns.
• Environmental Risks. Climate change and related transition risks are expected to become more pronounced, with 47 percent of respondents identifying environmental challenges as a critical driver of change over the next 10 years. Issues such as catastrophic events, policy adaptation, and environmental degradation are top of mind.

Despite recognizing these risks, organizational response frameworks often lag. Forty percent of wider workforce respondents reported they have never been consulted on emerging risk evaluations, and nearly half of all respondents (49 percent) could not pinpoint specific emerging risks of concern. However, most participants could identify key changes expected over the next 2 (95 percent) and 10 years (90 percent), highlighting a disconnect in risk management strategies.

WTW emphasized the importance of institutional intelligence and structured approaches to emerging risk evaluation. Scenarios were noted as an effective tool for aligning risk narratives and strategies, cited as valuable by 43 percent of respondents.

Adam Garrard, global chairman, risk and broking at WTW, stressed the need for innovative approaches to risk management, as follows.

The ability to effectively manage risk is key to thriving in an uncertain world. With regulators globally deepening their own exploration into emerging risks, investors asking more and more questions, and organizations facing material financial consequences as risks evolve, there is a need for new approaches. We need more than data-informed decision-making to explore the emerging risks shaping risk and opportunity. We need to focus on optimizing risk outcomes. Smart specialization, smart service, smart use of data, smart research. It all comes together to help navigate the complex risk landscape.

Lucy Stanbrough, head of emerging risks at WTW Research Network, underscored the urgency of adaptive frameworks, stating as follows.

We are witnessing a continual evolution of threats, which means we need a smarter way to think about emerging risks. Every single risk in our survey was someone's top risk, which shows there's a real need for enhanced understanding [of] a wide range of interconnected risks. Organizations recognize that they are not managing emerging risks as well as they wish they were at the moment, and are focused on changing that. When we look at the actions that organizations are looking to take in the next 2 years, putting an emerging risk ... framework in place was top of the list. Ensuring that framework is part of the business model cannot be emphasized enough. Organizations that manage to do this successfully and find the opportunities among relentless change, will prove to be more resilient and performant.