Climate Change Tops CEO List of Organizational Growth Risks

While cybersecurity, operational risks, and technological disruptions are still major concerns for CEOs, a recent survey has named climate change the top threat to growth for a majority of business sectors. 1,300 CEOs in 11 different industry sectors were surveyed for KPMG’s annual Global CEO Outlook. In it, a majority identified climate risk and other sustainability factors as a primary decision-making consideration, causing many asset managers and investors to move away from enterprises they believe are at risk. This is a jump from its position in fourth place in last year’s survey. In particular, the CEOs surveyed say they’re thinking more about disclosure to stakeholders and providing meaningful information on climate risks that may impact them financially. To manage these risks, CEOs are focusing on energy transition, with 76% of them saying their organization’s growth will depend on their ability to shift to a low-carbon, clean-energy economy. The other top risks:

• Emerging/disruptive technology risk
• Return to territorialism
• Cybersecurity risk, and
• Operational risk.

To navigate these uncertainties, the survey recommends executives “build a complete and nuanced picture of how risks are inter-connected and ensure their leadership teams are engaged in designing a response” – which echoes many resilience professionals’ calls to remove silos and develop inter-departmental cooperation to prepare for emerging business risks. Click here to read the survey.