Insured business risk and mitigation strategies are becoming more complex worldwide as companies large and small are more interconnected, according to CNA Hardy's recently-published 2019 Global Risk & Confidence Survey. "In an increasingly complex, tech-led, interconnected global economy, business leaders are being tested like never before," CNA Hardy CEO Dave Brosnan said in a press release. "The result is that confidence has dipped, investment in business fundamentals is down across the board, and reputation risk has emerged as the new threat that stalks the corridors of power." Here are some of the other dominant themes in the report:
  • Business confidence was down in Western economies throughout early 2019, spearheaded by a sharp fall from 70% to 50% in Europe. Only Asia Pacific bucks the global trend.
  • Economic, cyber and technology risk stand clear as business leaders' top three concerns globally; but reputation risk is growing faster than any other.
  • Alignment on risk perceptions across the U.K., Europe, North America and Asia-Pacific demonstrates the reality of global, interconnected risk, with over 80% globally believing they operate in a moderate to high risk environment.
  • Complexity in the global risk environment means executives globally are reigning back on investment in business fundamentals by an average of just under 20%.
All of these themes are predicted to impact business investments. "Uncertainty is a key driver of high levels of caution about investment in business fundamentals. Companies are simply not prepared to put capital at risk in an environment where unpredictability reigns," Brosnan said. "The inevitable, but extremely damaging consequence is that fewer companies are maintaining investment in technology, R&D and talent to support the top line." The slideshow above illustrates how reputation risk is rising while business confidence takes a hit, according to the 2019 Global Risk & Confidence Survey from CNA Hardy. These business concerns are driving risk prevention and mitigation conversations between brokers and their clients. "Reputation cover will become mainstream as boardroom risk is re-evaluated," Brosnan said. "In the same way the market has found a way to model the cost of non-physical damage business interruption claims as part of terror and political violence cover, we believe there is scope to model and mitigate the cost of managing reputation risk and the consequential damage to brand value caused by specific triggers." See also:  
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