According to the latest research from Aon a 14 percent worldwide increase in terrorist attacks in 2016 and populist nationalism are creating an increasingly volatile operating environment for international business.
Aon has published its 2017 Risk Maps covering Political Risk and Terrorism and Political Violence. Produced in conjunction with Roubini Global Economics and The Risk Advisory Group, the Aon maps claim that while Western countries saw a marked increase in terrorist incidents, attacks on these countries still account for less than three percent of terrorist violence globally. In 2016, the United States sustained the highest number of terrorist incidents in a decade, although, according to the Report, the threat is likely to remain moderate in 2017.
Looking at the Aon figures in more detail 2016 saw 4,151 terrorist attacks worldwide, up to from 3,633 in 2015 – a 14 percent increase. Western countries saw a 174 percent increase in terrorist attacks in 2016, up from 35 attacks in 2015 to 96 attacks in 2016.
According to Aon the terrorist threat continues to evolve, affecting an ever-wider set of sectors in more countries with more diversified tactics and intent to kill. Impacts range from loss of life to business interruption, and disruption in the supply chain.
Aon also points out that other violent risks are also evolving at the geopolitical level, leading to increased defence spending, more authoritarian forms of government and a weakening consensus between states. As a result Aon says that there are few indications of an overall improvement in violent risks in 2017. These developments have underlined the importance of considering crisis management perils that go beyond property damage, particularly in sectors such as oil and gas, transport and retail that have been most affected.
“The shifting dynamics around terrorism and political violence, reflected in the global events seen in 2016, are presenting an increasing challenge for companies,” said Scott Bolton, director, crisis management, Aon Risk Solutions. “Those with both domestic and international footprints have the potential to experience events that could impact their people, operations and assets. If we can understand what might reasonably impact an organisation and its people, then we are better able to apply ‘best fit’, consistent approaches to manage risk.”
“Global politics in 2017 is moving in a more violent and crisis-prone direction,” explained Henry Wilkinson, Head of Intelligence & Analysis at Risk Advisory. “The balance of violent risks is starting to tilt from non-state actors back to states. Islamic State- and Al-Qaeda-linked terrorism remains a critical threat, threatening dozens of countries and key sectors, including oil and gas, aviation, tourism, retail and media. But in 2017, businesses must develop strategies to face more business-threatening risks from the geopolitical realm. Authoritarian nationalism is on the rise and with it the risks of interstate crises and conflict, coups and rebellion, as well as political risks.”
Aon, Report, Political risk, Terrorism, Scott Bolton, Global