Embracing risk in the face of disruption
As the world continues to change quickly, and not always for the better, Australian business leaders are grappling with new and emerging risks, and opportunities in navigating the volatile environment. They are still adjusting to ‘COVID-normal’, where business models have been challenged and – in some cases – reinvented. Meanwhile, further uncertainty is coming from interest rate hikes, inflationary pressures, supply chain disruptions and accelerating digital and technology adoption, heightened cyber security and data risks together with climate action expectations and policy directions of a new Federal Government.
Top Australian risks to revenue growth
Cybersecurity was identified as being the top risk for Australian business leaders, who rated it more highly on their ‘risk radars’ than COVID-19 pandemic impacts, economic volatility, or climate change. As digital and technology adoption accelerates, leaders are understandably mindful of how organisational complexity and historical under-investment might expose them to cyber threats.
of Australian business leaders are significantly more concerned about cybersecurity risks
Geo-uncertainty continues to rise as a result of a constantly evolving geopolitical environment, challenging existing business operating models and resilience strategies. Leading Australian organisations are investing in scenario analysis and modelling, and leveraging the lessons learnt from COVID-19 to help model plausible outcomes that they may need to respond to.
Australian business leaders identified constraints on resources, lack of required skill sets and high turnover as being amongst the highest concerns relating to managing risks in their organisation. Additionally, Australian leaders are planning to use a combination of recruitment, technology uplift and flexible operating models to win the war for talent.
of organisations indicated that they will focus on increasing headcount in the risk function
of respondents plan to increase their spend on risk technology
of respondents indicated that they would increase their managed services spend in the coming year
In an environment where change is constant, a robust risk strategy can allow Australian business leaders to drive value, elevate risk maturity, shift mindsets, increase confidence and enable an appetite aligned approach to risk and opportunity.
The 2022 Global Risk Survey suggests five key actions that organisations should adopt to confidently navigate uncertainty and capitalise on opportunities whilst mitigating against downside events. Our report explores these five areas using observations from the Australian context.
The 2022 Global Risk Survey is a survey of 3,584 business and risk, audit and compliance executives conducted from February 4 to March 31, 2022. Business executives make up 49% of the sample, and the rest is split among executives in Audit (16%), Risk management (24%), and Compliance (11%).
Fifty-eight percent of respondents are executives in large companies ($1 billion and above in revenues); 19% are in companies with $10 billion or more in revenues.
Respondents operate in a range of industries: Financial services (23%), Industrial manufacturing (22%), Retail and consumer markets (16%), Energy, utilities, and resources (15%), Tech, media, telecom (13%), Health (9%), and Government and public services (2%).
Respondents are based in various regions: Western Europe (30%), North America (29%), Asia Pacific (21%), Latin America (12%), Central and Eastern Europe (3%), Middle East (3%), and Africa (3%).
PwC Research, PwC’s global Centre of Excellence for market research and insight, conducted this survey.
Chief Risk Officer, PwC Australia
Tel: +61 2 8266 7809
Risk Consulting Lead, PwC Australia
Tel: +61 416 301 798
Director, PwC Australia
Tel: +61 2 8266 0181