Pandemic 'biggest threat' to Australian business: Allianz survey
Pandemic outbreaks have for the first time been listed as the biggest threat to Australian businesses, according to an annual risk survey by Allianz Global Corporate and Specialty (AGCS).
Some 45% of respondents to the survey, released today, named pandemic-related fallouts such as curbs on movements and workforce issues as the number one peril this year, with business interruption a close second, with 42%.
Changes in legislation and regulations and cyber incidents, which took top and second spots respectively last year, tied third, on 38% each.
Natural catastrophes moved up one spot from last year to fifth (24%) while climate change/increasing weather volatility slipped from third to sixth (22%).
Rounding out the top 10 risks are market developments (20%), macroeconomic developments (13%), new technologies (11%) and fire/explosion (7%).
AGCS says the results for Australia reflect the impact from events that affected the country last year, including last year’s Black Summer catastrophes. The findings also illustrate concerns over longstanding risks facing the business community.
“The COVID-19 pandemic has not only changed our society, but it has fundamentally changed the way businesses operate, so it is no surprise it will continue to be the number one risk in Australia for [this year],” Pacific Distribution Director James Stack said.
“Not only were there financial, operational and emotional challenges, there were broader implications on supply chains as a result of China imposing new restrictions on Australian imports and greater uncertainty brought on by governments introducing tough lockdown measures.”
He says the last year’s devastating bushfire season “remains front of mind for many when considering potential business risks for the year ahead”.
“Our hope is that business and individuals can learn from their experiences in 2020 and make sure they have in place measures which will reduce the impact of similar events in the future,” Mr Stack said.
The widespread disruption caused by COVID-19, including economic devastation, has left businesses with lingering fears over future possible communicable diseases outbreaks.
“COVID-19 has highlighted the need to prepare for non-physical damage business interruption scenarios, and as a result we will see businesses building more resilient operations that are able to withstand those risks seen through COVID and de-risk their supply chains,” Mr Stack told insuranceNEWS.com.au today.
The survey findings for Australia, based on responses from 55 participants for the Allianz annual Risk Barometer, mirror similar results at the regional and global level.
Globally 41% cited business interruption as the leading risk, followed closely by pandemic outbreak and cyber incidents, which shared second place, on 40% each. In the Asia Pacific region, which includes Australia, cyber incidents placed first (41%) and pandemic outbreak was second (39%), entering the top 10 list for the first time.
“The Allianz Risk Barometer 2021 is clearly dominated by the COVID-19 trio of risks. Business interruption, pandemic and cyber are strongly interlinked, demonstrating the growing vulnerabilities of our highly globalised and connected world,” AGCS CEO Joachim Müller sad.
“While the pandemic continues to have a firm grip on countries around the world, we also have to ready ourselves for more frequent extreme scenarios, such as a global-scale cloud outage or cyber-attack, natural disasters driven by climate change or even another disease outbreak.”
The Allianz Risk Barometer this year is based on responses from a record 2769 participants in 92 countries and territories. It was conducted among Allianz customers, brokers, industry trade bodies, risk consultants, underwriters and claim experts.