In 2024, companies across the world are primarily concerned about cyber incidents, which encompass ransomware attacks, data breaches, and disruptions to their IT systems. This unsettling reality was revealed by the Allianz Risk Barometer. Additionally, the closely connected risk of business interruption follows as the second most pressing concern for these companies. According to over 3,000 risk management professionals, the most notable climbers in the latest compilation of major global business risks are natural catastrophes, which have jumped from sixth to third position year-on-year, fire and explosions, which have moved up from ninth to sixth position, and political risks and violence, which have risen from tenth to eighth position.
The concerns about legislation and regulation, cyber incidents, and macroeconomic developments are gaining attention in Nigeria, according to the report. These three factors have emerged as the highest risks, accounting for 36% of responses. Notably, changes in legislation and regulation have risen in importance since 2023, moving from fourth place to a top concern. This highlights the ever-changing regulatory environment and the demand for companies to adjust to new policies and comply with updated requirements. Yomi Onifade, CEO of Allianz Nigeria. ,emphasized how the ever-evolving regulatory landscape in Nigeria presents formidable obstacles for local enterprises.
There has been a notable increase in cyber activities.
Thus, it is of utmost importance for companies to remain up-to-date and guarantee adherence to regulations in order to minimize possible risks. Furthermore, there has been a notable increase in cyber activities, elevating its position from third to second place in 2023. Businesses are now acknowledging the pressing requirement to strengthen their cybersecurity protocols in order to safeguard sensitive information and sustain uninterrupted operations. Onifade stressed the importance of cybersecurity in today’s digital era, where businesses heavily depend on online platforms. Safeguarding both their operations and customer information must be a top priority for businesses. Negligence in this regard can result in dire consequences.
Businesses continue to grapple with economic uncertainties and volatility, as macroeconomic developments persist as a significant risk. Onifade emphasized the dynamic nature of the Nigerian business landscape, stressing the importance of adaptability to ever-changing economic conditions. Mitigating the effects of macroeconomic challenges necessitates a strong risk management strategy. Commenting on the findings, The CEO of Allianz Commercial, Petros Papanikolaou, pointed out that the current Allianz Risk Barometer highlights the significant challenges that companies globally confront nowadays. These challenges include digitalization, climate change, and an unpredictable geopolitical landscape.
Respondents expressed utmost concern on data breaches.
Moreover, the shared apprehension of cyber threats, business interruptions, and natural disasters brings together large corporations, mid-size enterprises, and smaller businesses. Yet, the disparity in resilience between these different entities is expanding. The report highlights how larger organizations have heightened their risk awareness following the pandemic, leading to a significant push to enhance their resilience. On the contrary, smaller enterprises frequently face the challenge of insufficient time and resources to recognize and adequately ready themselves for various risk situations. Consequently, they experience prolonged downtime in resurrecting their business following an unforeseen event.
Cyber incidents continue to dominate the cyber activity realm in 2024, remaining the most critical risk internationally for the third consecutive year. This rampant threat, accounting for 36% of all responses, is a top risk in 17 nations worldwide, including Nigeria, Uganda, Kenya, Mauritius, Australia, France, Germany, India, Japan, the United Kingdom, and the United States. Out of the respondents who participated in the Allianz Risk Barometer survey, 59% expressed their utmost concern regarding data breaches, considering it as the most prominent cyber threat. Following closely behind, 53% of the respondents identified attacks on critical infrastructure and physical assets as their second major concern.
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Furthermore, there was a disconcerting revival of ransomware attacks in 2023, marked by a significant rise in insurance claims that exceeded 50% compared to the previous year. This formidable surge in activity ranks third, accounting for 53% of all incidents. Scott Sayce, the Global Head of Cyber at Allianz Commercial, states that the surge in cyber activity projected for 2024 will be driven by various factors such as the increasing occurrence of issues arising from inadequate cyber security measures, particularly in mobile devices. Furthermore, the scarcity of millions of cyber security professionals and the vulnerability faced by smaller companies relying on IT outsourcing are also anticipated to contribute to this upward trend.