The risks of critical equipment failure and a cyber attack on industrial control systems are major concerns for 94 percent and 84 percent of Fortune 500-size companies, respectively.
That's according to a new survey of 200 business leaders with companywide responsibility for overseeing equipment operations or equipment risk commissioned by FM Global.
All respondents were from companies with more than US$1 billion in revenue, and three-quarters were from companies with over US$5 billion.
In a statement, FM Global explained that equipment failure risks have increased over the past five years in the judgment of 43 percent of respondents, compared with only 29 percent who said those risks have decreased in that time.
The survey found the stakes of equipment failure to be high: 75 percent of respondents said they expected it would take months, at least, for their companies to recover financially from the failure of critical equipment, with 14 percent of them predicting recovery would take years.
Respondents said that they expected a range of negative impacts in the event of a critical equipment failure:
- 54 percent said they expected a decline in revenue/earnings;
- 51 percent said they expected increased scrutiny from the investment community;
- 50 percent said they expected the introduction of regulatory compliance problems;
- 48 percent said they expected the degradation of brand/reputation;
- 46 percent said they expected an inability to fulfill orders, leading to a decline in market share;
- 39 percent said they expected a decline in share price; and
- 29 percent said they expected layoffs and/or loss of key employees.
"The possibility of equipment failure is weighing heavily on the minds of business leaders, and it should," said Malcolm Roberts, executive vice president at FM Global. "A robust economy, turnover in the technical workforce and an increasingly potent cyber criminal community means every company should be scrutinizing its potential vulnerabilities now."
Learn more: FM Global.
Victoria Spears
Victoria Prussen Spears is senior vice president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. A graduate of Sarah Lawrence College and Brooklyn Law School, Ms. Spears was an attorney at a leading New York City law firm before joining Meyerowitz Communications. She may be contacted at [email protected].