Although natural disasters remain a key risk for many technology companies, our survey respondents expressed more concerns about cyberattacks or product errors.
Many production facilities are in earthquake-prone areas, and climate change is stoking hurricanes, cyclones, tornadoes, and wildfires at unprecedented levels. But most technology companies have backup facilities that allow them to keep products and solutions up and running in the event of a natural disaster.
Just 25% of survey respondents said that a natural disaster that affects a key facility is a catastrophic risk, placing it fourth on the list for technology companies.
Respondents were far more concerned with the impact of ransomware and product errors. Nearly half of respondents considered a ransomware attack that shuts down their operations or that of a key supplier to be a catastrophic risk. This was more than double the response to this question in 2020.
Ransomware concerns placed second on the list of concerns this year. About one-third of respondents said a ransomware attack leading to a data breach would be a catastrophic risk for their company. Third on the list was a product error or vulnerability leading to a shutdown of a customer’s operation; two years ago, this was the survey’s top catastrophic risk concern.
Events do not need to be catastrophic to threaten a technology company’s resilience. Even smaller outages, failures, or attacks can pose a risk to tech companies where availability, speed, and customer trust are most valued. It is not surprising that the top six risks for tech companies all related to keeping systems running, and have generally dominated the list since this survey began in 2015, with data security and privacy filling the top spot every year.
To see the full ranking of technology risks and learn how technology companies can adjust their approach to risk management to mitigate these risks, download a copy of the 2022 Global Technology Risk Forum. Additionally, hear more about the report standouts in this clip from our 2022 Silicon Valley Technology Risk Forum.
New Catastrophic Risks and Market Challenges – 2022 Tech Risk Forum Replay
We review Marsh’s 2022 Global Technology Industry Risk Study, highlighting the challenges that tech companies face as they confront increasing demand for their services combined with increased underwriter scrutiny of key risks and higher premium costs.