Publication date: 2018-11-01 07:42
This report serves as the research base on which the Risk Response Network works together on mapping, monitoring, managing and mitigating global risks.
Volcanic winter – A level 7 or 8 eruption on the Volcanic Explosivity Index, which alters the Earth’s atmospheric composition, could cool the planet and, at the least, ruin several seasons of food production. At worst, it could present an existential threat to modern civilization.
Low-carb diets are nothing new and have been used in the medical community for a variety of purposes for more than a century. Based on decades of research, low-carb diets have been linked to benefits including:
Investors must consider the possibility of default and factor this risk into their investment decision. As one means of analyzing the possibility of default, some analysts and investors will determine a company's coverage ratio before initiating an investment. They will analyze the corporation's income and cash flow statements , determine its operating income and cash flow, and then weigh that against its debt service expense. The theory is the greater the coverage (or operating income and cash flow) in proportion to the debt service expenses, the safer the investment.
In those cases where variation exists, it is – perhaps unsurprisingly – often the people from NGOs who exhibit stronger assessments than some of their peers, especially in the environmental category. Also in several geopolitical risk categories, survey respondents affiliated with International Organizations have higher mean scores than others. At the other end of the scale, individuals working in the private sector and in government assessed many of the risks as lower than others.
The impacts of crime, terrorism and war in the virtual world have yet to equal that of the physical world, but there is fear that this could change. Hyperconnectivity is a reality. With over five billion mobile phones coupled with internet connectivity and cloud-based applications, daily life is more vulnerable to cyber threats and digital disruptions. The related constellation of global risks in this case highlights that incentives are misaligned with respect to managing this global challenge. Online security is now considered a public good, implying an urgent need to encourage greater private sector engagement to reduce the vulnerability of key information technology systems.
The reticence of Japanese leaders to disseminate information using digital media was understandable, as responding quickly carries inherent risks of being wrong, and they did not want to risk inciting panic and a chaotic exodus, especially from the Tokyo metropolitan area. However, the speculation that spread about the situation at Fukushima demonstrated how this reticence allowed rumours to take on the appearance of fact. This information gap made it more difficult for subsequent official explanations to displace rumours in the public consciousness.
The perceptions of the most systemically important risks in each category are largely aligned across different occupational backgrounds. Exceptions include responses from International Organizations affiliates, who often chose failure of climate change adaptation as the environmental Centre of Gravity, and mismanagement of population ageing as the societal Centre of Gravity. NGOs have a different view in the economic category, and predominantly see major systemic financial failure as the Centre of Gravity.
Another danger that bond investors face is reinvestment risk , which is the risk of having to reinvest proceeds at a lower rate than the funds were previously earning. One of the main ways this risk presents itself is when interest rates fall over time and callable bonds are exercised by the issuers.