Severe threats to our climate
account for all of the Global Risks Report’s top long-term risks, with
“economic confrontations” and “domestic political polarization” recognized
as significant short-term risks in 2020
It warns that geopolitical
turbulence and the retreat from multilateralism threatens everyone’s
ability to tackle shared, critical global risks
Without urgent attention to
repairing societal divisions and driving sustainable economic growth,
leaders cannot systemically address threats like the climate or
biodiversity crises, the report warns
Read the full report here and find out more about the Global Risks Initiative here. Join the conversation using #risks20
London, United Kingdom, 15 January 2020 – Economic and
political polarization will rise this year, as collaboration between world
leaders, businesses and policy-makers is needed more than ever to stop severe
threats to our climate, environment, public health and technology systems. This
points to a clear need for a multistakeholder approach to mitigating risk at a
time when the world cannot wait for the fog of geopolitical disorder to lift.
These are the findings of the World Economic Forum’s Global Risks Report 2020,
The report forecasts a year of increased domestic and international divisions
and economic slowdown. Geopolitical turbulence is propelling us towards an
“unsettled” unilateral world of great power rivalries at a time when business
and government leaders must focus urgently on working together to tackle shared
Over 750 global experts and decision-makers were asked to rank their biggest
concerns in terms of likelihood and impact and 78% said they expect “economic
confrontations” and “domestic political polarization” to rise in 2020.
This would prove catastrophic, particularly for addressing urgent challenges
like the climate crisis, biodiversity loss and record species decline. The
report, produced in partnership with Marsh & McLennan and Zurich Insurance
Group, points to a need for policy-makers to match targets for protecting the
Earth with ones for boosting economies – and for companies to avoid the risks
of potentially disastrous future losses by adjusting to science-based targets.
For the first time in the survey’s 10-year outlook, the top five global risks
in terms of likelihood are all environmental. The report sounds the alarm on:
Extreme weather events with
major damage to property, infrastructure and loss of human life
Failure of climate-change
mitigation and adaptation by governments and businesses.
Human-made environmental damage
and disasters, including environmental crime, such as oil spills, and
Major biodiversity loss and
ecosystem collapse (terrestrial or marine) with irreversible consequences
for the environment, resulting in severely depleted resources for
humankind as well as industries.
Major natural disasters such as
earthquakes, tsunamis, volcanic eruptions, and geomagnetic storms.
It adds that unless stakeholders adapt to “today’s epochal
power-shift” and geopolitical turbulence – while still preparing for the future
– time will run out to address some of the most pressing economic,
environmental and technological challenges. This signals where action by
business and policy-makers is most needed.
“The political landscape is polarized, sea levels are rising and climate fires
are burning. This is the year when world leaders must work with all sectors of
society to repair and reinvigorate our systems of cooperation, not just for
short-term benefit but for tackling our deep-rooted risks,” said Borge Brende, President
of the World Economic Forum.
The Global Risks Report is part of the Global Risks Initiative which brings
stakeholders together to develop sustainable, integrated solutions to the
world’s most pressing challenges.
Systems-level thinking is required to confront
looming geopolitical and environmental risks, and threats that may otherwise
fall under the radar. This year’s report focuses explicitly on impacts from
rising inequality, gaps in technology governance, and health systems under
Chairman of Marsh & McLennan Insights, said: “There is mounting pressure on
companies from investors, regulators, customers, and employees to demonstrate
their resilience to rising climate volatility. Scientific advances mean that
climate risks can now be modeled with greater accuracy and incorporated into
risk management and business plans. High profile events, like recent wildfires
in Australia and California, are adding pressure on companies to take action on
climate risk at a time when they also face greater geopolitical and cyber risk
To younger generations, the state of the planet is even more alarming. The
report highlights how risks are seen by those born after 1980. They ranked
environmental risks higher than other respondents, in the short- and long-
terms. Almost 90% of these respondents believe “extreme heat waves”,
“destruction of ecosystems” and “health impacted by pollution” will be
aggravated in 2020; compared to 77%, 76% and 67% respectively for other
generations. They also believe that the impact from environmental risks by 2030
will be more catastrophic and more likely.
Human activity has already caused the loss of 83% of all wild mammals and half of plants
– which underpin our food and health systems. Peter Giger, Group Chief Risk Officer,
Zurich Insurance Group warned of the urgent need to adapt faster to avoid the
worst and irreversible impacts of climate change and to do more to protect the
“Biologically diverse ecosystems capture vast amounts of carbon and provide
massive economic benefits that are estimated at $33 trillion per year – the
equivalent to the GDP of the US and China combined. It’s critical that
companies and policy-makers move faster to transition to a low carbon economy
and more sustainable business models. We are already seeing companies destroyed
by failing to align their strategies to shifts in policy and customer
preferences. Transitionary risks are real, and everyone must play their part to
mitigate them. It’s not just an economic imperative, it is simply the right
thing to do,” he said.
The Global Risks Report 2020
has been developed with the invaluable support of the World Economic Forum’s
Global Risks Advisory Board. It also benefits from ongoing collaboration with
its Strategic Partners Marsh & McLennan and Zurich Insurance Group and its
academic advisers at the Oxford Martin School (University of Oxford), the
National University of Singapore and the Wharton Risk Management and Decision
Processes Center (University of Pennsylvania).
Respondents were asked to assess: (1) the likelihood of a global risk occurring over
the course of the next 10 years, and (2) the severity of its impact at a global level if
it were to occur.
These are the top 5 risks by
likelihood over the next 10 years: