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AXA Future Risks Report 2020: coronavirus crisis overshadows climate change

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AXA published its seventh annual report on the top ten emerging risks today. The Future Risks Report 2020 is dominated at the global level by the health crisis, while climate change remains the greatest risk in Europe. Despite being located at the geographical center of the continent, Switzerland does not always occupy the middle ground among European countries.

“Understanding and anticipating risks is at the heart of the insurance business. AXA’s Future Risks Report is an essential tool to inform and prepare us for major risk trends impacting our society,” explained AXA Group CEO Thomas Buberl today at the launch of the AXA Future Risks Report 2020 in Paris.

It comes as no surprise that this year’s AXA Future Risks Report is dominated by the global COVID-19 crisis, which has pushed previously underestimated risks associated with pandemics and infectious diseases up from eighth place in last year’s ranking to first place. Climate change, which had regularly topped the list in recent years, is in second place.

The climate emergency remains the greatest risk in Europe, but it has fallen to third place in Asia and the Americas, with a particularly pronounced drop in North America. The proportion of North American experts who see climate change as a major threat has fallen from 71% last year to just 46%. “This seventh edition is of course marked by the exceptional context of the COVID-19 pandemic. It highlights health as a major issue, which we consider a positive shift, as we have considered it underestimated for years. However, this must not affect the fight against climate change, which remains the most significant and pressing challenge of our time,” stressed the CEO.

The downside of the digital transformation

Meanwhile, risks associated with cybersecurity are ranked third and increasing in prominence among those surveyed. Reasons for this include the ever more widespread adoption of new technologies and the explosion of cyberattacks during the coronavirus crisis. The growing risk of cyber warfare in particular is causing concern: 47% of the experts who took part see it as the main threat, up from 37% in 2019.

Also linked to the threat of digital warfare, geopolitical risks are placed fourth, followed by the risk of social unrest in fifth place, which has increased as a result of the global economic slump.

“In line with last year, this year’s edition highlights the growing interconnection of risks, calling for collective and concerted solutions to strengthen the resilience of our economies and societies,” said Buberl.

Swiss people more risk-friendly

In contrast to many other countries, respondents from Switzerland view climate change as a greater future risk than pandemics and infectious diseases. They believe that the climate emergency is the greatest challenge facing our society for the next five to ten years, followed by health crises and cybersecurity. In addition, 40% of the Swiss experts surveyed attach a lot of importance to risks associated with natural resources and biodiversity, compared with a global average of only 22%.

Swiss respondents also deviate from the norm in some personal respects. For instance, they are less risk-averse and feel less vulnerable to emerging risks than those in many other countries. In fact, 61% of them regularly take risks, more than in any other European country. Only 20% say they often feel vulnerable day to day, compared with 44% worldwide. They also view the impact of risks on their physical and mental health and their children’s wellbeing as much less problematic than the rest of the world.

In addition, the Swiss are more relaxed about the coronavirus situation than the global population as a whole. Asked about the personal consequences of the health crisis, 71% said they would pay more attention to their mental health in future. That is 12 percentage points below the average. Only 43% said that they intended to bolster their savings, compared with two thirds worldwide.

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Watch the panel discussion on the AXA Future Risks Report:

 

Additional information

The AXA Future Risks Report enters its seventh year in 2020. The global study gauges changes in the perception of emerging risks and ranks these risks. A survey of more than 20,000 risk management experts and members of the general public worldwide was conducted in collaboration with the market research firm Ipsos and the political risk consultancy Eurasia Group. 

 

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