Recently I wrote a blog about how the adoption of new technology in the mining industry will increase the risk of cyber crime. However this is just one of many risks the industry faces today. This raises the question as to what are the main risks impacting all global businesses. Luckily for us, the World Economic Forum undertakes an annual survey on exactly this subject.
Each year business leaders are queried about what they view as their major risks. The survey results are summarized in the Global Risk Report.
The 2019 report can be downloaded at this link. http://www3.weforum.org/docs/WEF_Global_Risks_Report_2019.pdf.
The study rates risks according to the categories “likelihood” and “impact”. A risk could have a high likelihood of occurring but have a low economic impact. One might not lose sleep over these ones.
Another interesting feature in the report is seeing how the top risks change from year to year. Some risks from 10 years ago are no longer viewed as key risks today.
2019 risk situation
In 2019 environmental related risks dominate the survey results. They account for 4 of the top 5 risks by “impact” and 3 of the top 5 by “likelihood”. Technology related concerns about data fraud and cyber-attacks were also viewed as highly likely (#4 and #5). See the image below for the top 5 risks in each category.
Although the Global Risk survey wasn’t specifically directed at the mining industry, all of the identified risks do pertain to mining.
10 year risk trend
It is also interesting to look at the detailed 10 year table in the report to see how the risk perceptions have changed over the last decade.
None of the top five “Impact” risks from ten years ago are still in the top five now and only two from 2014 still exist. In the “likelihood” category, a similar situation exists.
It will be interesting to compare the 2024 list with 2019 list to see how risks will continue to evolve.
How about the mining industry
EY Global Mining & Metals also undertake a risk survey, focused on mining only. You can read their article at this link “The Top Risks Facing Mining and Metals”. Their top 10 risks are listed below, many are different than those from the World Economic Forum ranks. You must read the EY article to fully understand the details around their risk items.
License to operate (difficulty to acquire)
Digital effectiveness (lack thereof)
Maximizing portfolio returns (can this be done)
Cyber security (increasing risk of attack)
Rising costs (can costs be controlled)
Energy mix (acceptable power sources)
Future of workforce (lack of interest in the sector)
Disruption (falling behind competitors)
Fraud (increasing sophistication)
New world commodities (versus reduced demand for some commodities)