Technology risk Connected to the point above, and given the increase of digital transformations in businesses, the fight against cyber threats is likely to increase. According to the IMF, the number of cyber-attacks tripled over the past decade. The financial services sector was the most heavily targeted industry. Governments, individuals and companies can expect to continue being hit with ransomware, malware and phishing attacks. Rates of both types of cyber threat will likely to continue, leaving many organizations battling two continuous business continuity events – cybersecurity and the pandemic. The pace of attacks won’t lessen in 2021. The pandemic has also intensified companies’ dependencies with critical third party suppliers, including cloud computing and data services. For instance, according Gartner, worldwide public cloud service revenue are expected to grow to $331 billion in 2022 from $182 billion in 2018. With this context, understanding the risk of the extended enterprise, including the key dependencies on firm’s data processes, value chain and/or customer services, will be key for the success of businesses going forward. Social Risks In a society polarised in many countries and very sensitive to social events (like the Black Lives Matter movement during 2020), a path to normality will likely deepen and bring to the surface existing social vulnerabilities. Issues surrounding the availability of medical services, higher unemployment, access to education, food, poverty and inequality, and speed of access to vaccines are likely to come to the fore. In my view, this creates the right environment for significant political and social unrest with economic consequences for businesses. For instance, in Latin America, there is a growing risk that a worsening poverty and inequality will trigger political and social instability. In this context of higher social sensitivity, major corporations and institution will have to pay more attention to this increased scrutiny into how they behave internally and externally and their contribution to society, Despite the potential bumpy road to recovery, I am still optimistic about 2021. However more than ever, a strategic approach to manage risks will be essential in protecting the organisation, guiding critical decisions, and generating tangible value.
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