Aon Names Top 10 Risks

Economic risk is the greatest threat faced by business leaders, a new survey finds.

Aon's 2011 Global Risk Management Survey queried 1,000 business professionals from 58 countries and found the threat of sustained economic trouble foremost in their minds. Indeed, 67% of respondents reporting loss of income in the last 12 months associated with economic risk.

"The findings shared in our report underscore the undeniable interdependence among various risks as well as economies around the globe,” said George Zsolnay, head of Aon Analytics in the United States. “It is more important than ever for organizations to embrace an enterprise-wide approach to managing risk, and optimize their strategy on a global basis."

Aon says the results also emphasized the need of companies to invest in technology to remain competitive as “failure to innovate/meet customer needs” ranked sixth on the list.

"Throughout the economic recession, many organizations pulled in their oars—tabling research and development projects, decreasing spend on information technology and freezing hiring," said Constantin Beier, global head of Aon Analytics and chief commercial officer of Aon's Center for Innovation and Analytics in Dublin. "Today, business leaders are realizing this strategy won't work in the long term. Organizations must begin reinvesting in fundamental areas such as these if they are to survive and thrive." 

The survey also revealed the emerging acceptance of risk management as a core function of business success, with 31% of respondents reported having a CRO, up from 25% in 2009.

Regarding insurance, financial stability was cited as the top criterion in an organization's choice of insurers, with respondents indicating that a carrier’s financial capacity to pay claims outranked the desire for competitive pricing.

Aon's Top 10 risks for 2011 are:

1. Economic slowdown

2. Regulatory/legislative changes

3. Increasing competition

4. Damage to reputation/brand

5. Business interruption

6. Failure to innovate/meet customer needs

7. Failure to attract or retain top talent

8. Commodity price risk

9. Technology failure/system failure

10. Cash flow/liquidity risk

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