January 2014’s gathering of policymakers, politicians and business leaders at the Davos World Economic Forum provided a sombre assessment of risk. The World Economic Forum’s 2014 Global Risk Report maps 31 global risks according to level of concern, likelihood and impact and the interconnections among them.
The risks of highest concern to respondents of the study are fiscal crises in key economies, structurally high unemployment and underemployment, and water crises. The risks considered “high impact” and “high likelihood” are mostly environmental and economic in nature. Interestingly, female respondents perceived almost all global risks as both more likely and more impactful than did males, especially in the environmental category.
The failure of global governance emerges as a central risk that is connected to many different issues and the decline of trust in institutions, lack of leadership, persisting gender inequalities and data mismanagement were among trends to watch.
But amid all of the gloomy reading there is one stand out comment. The world faces risks that can be addressed only by long-term thinking and collaboration among business, governments and civil society. And if there is a lesson to be learned it is this: That risk management in business also needs to take a long term view with adequate planning and collaboration between stakeholders.
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