Covid-19 disruption triggers rise in risk trend analysis, finds BCI

Non-occupational disease has topped a poll of business risks by the Business Continuity Institute (BCI) after jumping from bottom position in the same survey 12 months ago, with 67% of respondents citing lack of preparedness as the main cause of business disruption last year.

The survey of 365 global business continuity and risk management professionals also found that Covid-19 has forced businesses to improve their resilience through risk management, with a record 81% of those taking part in the annual research now conducting longer-term risk trend analysis.

The poll found that the pandemic was also behind an increase in secondary risks, including health incidents which were cited as the second most common source of disruption to businesses during the past year, driven by employees’ mental health issues.

The BCI Horizon Scan Report, supported by the BCI and based on its survey, found cyberattacks and IT outages were ranked as the fourth- and fifth-placed business disruption risks in the last 12 months, after Covid-19 created vulnerabilities with the shift to remote working. Political risks and violence returned to the top ten for the first time in three years, again driven by tensions sparked by the pandemic.

Non-occupational disease remains at the top of the business risk list for the next 12 months for all regions except the Americas, which lead with the risk of a lone attacker. Cyberattack and data breach take second place, followed by IT and telecom outage, regulatory changes and climate change.

On the jump in companies conducting longer-term risk trend analysis, the BCI says: “The pandemic has been the catalyst for accelerating the introduction of a more structured, centralised analysis programme, with managers largely driving the change.”

Chair of the BCI Christopher Home said the pandemic has been a “timely wake-up call to be better prepared for future crises” and to address trickier scenarios that have been avoided or neglected.

Rachael Elliott, head of thought leadership at the BCI, said: “Many organisations have already learnt from errors made and have adopted a more intensive and collaborative view to risk planning in 2021. Management have become more engaged as a result and are already pushing for more resource to be available, funds being made available to purchase new tools and seeking to align or certify to international standards for the first time.”

Managing supply chain disruption will be a key focus for businesses going forward, the BCI says in the report sponsored by the BSI.

It was eighth position in the poll of business disruption risks in the past 12 months and sits in seventh position during the next year.

“With supply chains dramatically affected by the pandemic, practitioners believe that disruptions will continue to be felt in 2021, and potentially with the added issue of boycotting of supply chains and conflict,” the report states.

The BCI says new regulations around the world will also impact global supply chain risks facing businesses. They will be holding firms to account for environmental and human rights abuses in their European supply chains, it explains. New legislation to protect against illegal deforestation in supply chains is also an issue in Europe and the US, the BCI adds.

BCI: Top ten disruption risks faced by businesses during the past 12 months 

  1. Non-occupational disease
  2. Health incidents
  3. Safety incidents
  4. IT and telecom outage
  5. Cyberattack and data breach
  6. Extreme weather event
  7. Lack of talent/key skills
  8. Supply chain disruption
  9. Regulatory changes
  10. Interruption to utility supply

 BCI: Top ten disruption risks facing businesses during the next 12 months

  1. Non-occupational disease
  2. Cyberattack and data breach
  3. IT and telecom outage
  4. Regulatory changes
  5. Extreme weather event
  6. Critical infrastructure failure
  7. Supply chain disruption
  8. Health incident
  9. Lack of talent/key skills
  10. Natural disasters
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