India Risk Survey 2018: Information & Cyber Insecurity poses top risk to businesses
Numerous Industries such as Financial Services, Government/PSU, Infrastructure, and Telecom have collectively ranked Information & Cyber Insecurity as the Number 1 risk, illustrating the urgency for upgrading existing resources, both human capital as well as technology, to meet global compliance regulations.
The seventh edition of the FICCI-Pinkerton 'India Risk Survey 2018' was released here today. The India Risk Survey (IRS) 2018 states Infrastructure Risks, Occupational Hazards at Workplace and Legal Regulatory Risk as the Emerging Risks of 2018.
Natural Hazards has emerged as the second highest risk in the survey this year, with Floods being the most prevalent threat. While most destruction could be mitigated with proper maintenance of existing infrastructure, effective prediction analysis of future weather conditions is crucial to reduce the sheer volume of damage that is borne by the unprepared.
Information and Cyber Insecurity has emerged as the Number 1 Risk for two consecutive years. Threat Mapping measured Data Theft, Phishing and Hacktivism as the most prevalent threat. Numerous Industries such as Financial Services, Government/PSU, Infrastructure, and Telecom have collectively ranked Information & Cyber Insecurity as the Number 1 risk, illustrating the urgency for upgrading existing resources, both human capital as well as technology, to meet global compliance regulations.
Natural Hazards ranks as the second biggest risk to business operations in the India Risk Survey 2018. As per the findings of India Risk Survey 2018, floods pose the biggest threat to business operations. Inadequate infrastructure and maintenance by concerned bodies remain a primary factor that would allow natural hazards to pose serious risks to business operations. Further, a lack of preparedness and early warning systems have contributed to making Natural Hazards a risk that should be considered with more seriousness.
Political & Governance Instability rose to fifth rank this year with Policy Changes as the most prevalent threat impacting business operations, indicative of rising uncertainty among the global investor community. In today's time, policymakers and business leaders can truly fulfill their role by timely anticipating risks.
'Strikes, Closures and Unrests' ranks in the sixth position in the India Risk Survey 2018. The survey finds that growing political instability has become a major cause for concern, which has resulted in violent clashes and unrests in several parts of the country. The implications posed by risks from Strikes, Closures, and Unrest have direct implications for financial losses incurred by businesses, and a slow-down in business development. Further, the country's reputation perceived as inhospitable for business to flourish also affects future prospects. Instability, threatening business operations, directly impacts the market by affecting investor confidence and an increase in the risk premium assigned to securities in the country. The Government continues to take steps to rectify situations by addressing worker disgruntlement through legal changes and reforms.
According to the Survey, Crime ranks in the seventh position. India is ranked 136 out of 163 countries in the Global Peace Index, 2018, moving up just one position as compared to a jump of 6 positions in 2017. It is noted that the risk of crime in India has seen a steady decline over the last few years. The Government and police have made use of social media and digital platforms to reach more people and ensure more efficient policing. Various police departments have taken to using social media as a tool for crime prevention.
The Survey finds that threats to security and safety posed by violent crimes, such as kidnapping and murder, are the biggest risk to company personnel.
'Corruption, Bribery & Corporate Fraud' continues to be one of the biggest risks faced by businesses in India, and ranks eighth in the India Risk Survey 2018. The perception of the risk has fallen, with India incorporating economic reforms to ensure that global investors are appeased. According to the World Bank's Doing Business 2018 rankings, India has jumped from 130 in 2017 to 100 in 2018 out of 189.
'Corruption, Bribery & Corporate Fraud' as a risk, however, continues to hinder growth and cause disruptions in progress. It dissuades potential investors and diminishes the growth opportunities of existing players. Investors have called for better corporate governance and more stringent regulation of business corporations.