How risk resilient is your region?

How risk resilient is your region? | Insurance Business America

How risk resilient is your region?

Looking for the best country to do business? It turns out great skiing and killer fondue aren’t the only factors drawing businesses to Switzerland. This year, it’s won the top spot in FM Global’s Resilience Index and bragging rights as the country where businesses are most likely to resist business disruption – or rebound quickly if it happens.                                                                                                            

In 2018, cyber attacks, global conflict, Mother Nature, and the ever-present threat of fire were driving factors behind resilience trends worldwide. The index ranks 130 countries based on data related to economics, supply chains, natural hazards, and risk quality factors like cyber risk, political risk, and regulations on things like building codes.

“Our mission is to give global business executives powerful intelligence to support their decisions about where to site facilities, what partners to select, and how to manage their risks,” says Thomas A. Lawson, chairman and chief executive officer at FM Global, one of the world’s largest commercial and industrial property insurers. “With the Resilience Index, business leaders can dig deeper than they ever have into geographical differences in resilience, including cyber risk.”

Common themes run across regions worldwide, like the rise of cyber attacks, which now pose existential threats to businesses, but the severity of risks and resilience varies significantly by geography. For example, says the report, cyber resilience has soared in Taiwan over the past year, but in France, it’s plummeted.

Highlights from the report:

Cyber risk
Last year, France came in at 68 out of 130 countries when it comes to cyber, but deteriorating civil liberties and a slight rise in internet penetration across the country have sent it to 101st place. Increased penetration also accounts for Australia’s drop in the rankings, from 66th to 75th.

On the other hand, Taiwan recorded the biggest surge in cyber resilience rankings, largely due to an increase in civil liberties. It now sits at number 50, up from 107 last year.

Last year’s Grenfell tragedy continues to stain the UK’s reputation for fire risk management. While fire is still the most common culprit for property damage globally, it’s one that can be prevented by establishing quality building codes – and enforcing them. This year, the UK comes in at 34 when it comes to fire risk quality.
Political risk
Unsurprising given the torrent of headlines over the past year, the US has dropped in political resilience rankings. That’s likely fueled by politics fraught with turmoil over North Korea’s nuclear program and Russia’s alleged meddling in the 2016 presidential election. However, the US remains in the top 12% of 130 regions when it comes to overall resiliency.
Natural disasters
2017’s disastrous hurricane season characterised by the triple threat of Harvey, Irma, and Maria, served as a harsh lesson for companies operating in areas exposed to the elements. Regions with high levels of exposure include: Philippines (ranked 88), Japan (24), Mexico (62), and the eastern region of the US (10).