Climate crisis is greatest global risk in 2022: World Economic Forum

Climate risks are chief among global concerns as the world enters the third year of the coronavirus pandemic, according to the Geneva-based World Economic Forum (WEF).

The WEF’s Global Risks Report 2022, released on Monday, found that in addition to the climate crisis, top long-term global risks include growing social divides, heightened cybersecurity risks and uneven recovery as the pandemic persists around the world, a news release accompanying the report said. Most experts believe that a global economic recovery will be volatile and unbalanced over the next three years, according to the WEF.

“The climate crisis remains the biggest long-term threat facing humanity,” Peter Giger, group chief risk officer for Zurich Insurance Group, said in a statement.

The Global Risks Report presents the results of the WEF’s Global Risks Perception Survey, in which respondents were asked to address how they have perceived various societal risks over the past two years. Survey respondents ranked “climate action failure” as the number one long-term threat to the world and the risk that could have the most severe impacts over the next decade, according to the report.

As governments and businesses face “increasing pressure to thwart the worst consequences,” the resultant “disorderly climate transition,” will “drive apart countries and bifurcate societies, creating barriers to cooperation,” according to the report.

The report stressed the “insufficient nature of current commitments” to climate goals and the complexities associated with necessary technological upgrades, noting that meeting a net-zero goal by 2050 will come in tandem with disorder.

The mere process of shifting away from carbon-based industries, which employ millions of workers, is bound to “trigger economic volatility, deepen unemployment and increase societal and geopolitical tensions,” according to the report. Meanwhile, adopting what the report characterized as “hasty environmental policies” could also bring unintended harm to nature.

The climate transition, the report argued, therefore behooves officials and corporate leaders to “account for societal implications,” or risk exacerbating existing inequalities.

“It is not too late for governments and businesses to act on the risks they face and to drive an innovative, determined and inclusive transition that protects economies and people,” Giger, the risk officer, said in a statement.

In addition to addressing the climate crisis, the WEF report also identifies cybersecurity as a top global risk, noting that increasing dependency on digital systems – intensified by the pandemic – has fundamentally “altered societies.”

Malware and ransomware attacks surged by 358 percent and 435 percent in 2020 and have been “outpacing societies’ ability to effectively prevent or respond to them,” according to the report.

Related to global internet-related achievements is the acceleration of space activity, which the report warned has led to an increased risk of collisions and subsequent release of space debris, as well as the mismanagement of competition in space.

“With cyber threats now growing faster than our ability to eradicate them permanently, it is clear that neither resilience nor governance are possible without credible and sophisticated cyber risk management plans,” Carolina Klint, risk management leader for Continental Europe at New York-based insurance firm Marsh, said in a statement.

“Similarly, organizations need to start understanding their space risks, particularly the risk to satellites on which we have become increasingly reliant, given the rise in geopolitical ambitions and tensions,” Klint added.

The WEF report closes by reflecting on year two of the coronavirus pandemic, drawing on the knowledge of the organization’s network of experts to offer practical suggestions for strengthening resilience in organizations.

Critical to effective pandemic management were two factors: the readiness of governments to adjust response strategies in a changing environment and the ability to maintain societal trust through effective communication, according to the report.

The report suggests that moving forward, governments “galvanize stronger interaction between public and private sectors” by balancing costs, regulating for resilience and adjusting data-sharing mechanisms. Businesses, meanwhile, should leverage planning opportunities in supply chains, codes of conduct and workforce resilience, according to the report.

“Health and economic disruptions are compounding social cleavages,” Saadia Zahidi, WEF managing director, said in a statement.

“This is creating tensions at a time when collaboration within societies and among the international community will be fundamental to ensure a more even and rapid global recovery,” Zahidi added. “Global leaders must come together and adopt a coordinated multistakeholder approach to tackle unrelenting global challenges and build resilience ahead of the next crisis.”

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