In this interview, Kachina Shaw interviews Max Rudolph, the author of the most recent Emerging Risks Survey, a report conducted by a coalition of risk management and actuarial organizations. The report highlights trends that all risk managers should be aware of.
What constitutes an emerging risk versus a non-emerging risk? An emerging risk will increase in importance over ten years. Rudolph continues:
…pandemics were a major risk following the 1918 outbreak, but then receded back to potential risk until recently and still could result in a major event not seen in many years. To me, our survey has shown cyber security as a risk to spend resources, evaluating since 2009 when responses exceeded 20 percent. This showed a broad interest in the risk, so risk managers could no longer hide behind the herd mentality that no one else was considering cyber risk.
The Emerging Risks study shows that cyber security is a growing concern, citing a leap into more survey participants' list of top five risks – from 21 percent to 45 in just five years. Although not focused on the specific risks involved, the survey does show a trend in how cyber security risk is manifesting. It is moving away from purely economic concerns.
Particularly, risks can combine or overlap such as when financial volatility combines with asset “blow-up” or international terrorism in concert with an increasingly interconnected cyber infrastructure.Despite the recent Target breach (which occurred just after the publication of the survey), Rudolph sees no surprises on the steady increase in cyber threats. His only shock is the notion that boards would choose insurance over improved practices to reduce the associated risks.
You can read the full interview here: http://www.itbusinessedge.com/interviews/emerging-cyber-risks-on-the-minds-of-risk-managers.html