The proliferation of a wide variety of cyber threats will make a high impact, cyber-enabled assault on critical infrastructure almost certain in 2020. This is one of the key forecasts made in RiskMap 2020, the global outlook for political and security risks in the year ahead published by specialist global risk consultancy Control Risks.
Cyber attacks in the coming year will increasingly become the default mechanism of retaliation in strategic conflicts, where traditional military measures are unpalatable. As a result, 2020 will see an escalation in the number and severity of cyber attacks globally. With many European countries ranking highly when it comes to Smart Cities and connected business according to the IESE Cities in Motion Index, this increased connectivity will prove one of the key points of vulnerability for globally connected business in 2020.
Jake Stratton, senior partner and head of Europe at Control Risks, commented: “Connected business and infrastructure is now the norm for most European enterprises, but with this connectivity comes considerable threat given the systemic nature of cyber attacks. In recent years, we’ve seen large-scale disruptive cyber operations based around strategic conflicts taking out business and national infrastructure across the globe as collateral damage. Connected global businesses will find their enterprise resilience to the potential effects of a systemic cyber attack tested to the full in 2020.”
Control Risks has identified the following as the top global risks facing business in 2020:
Geopolitics and the US campaign trail
The US election campaign will have a palpable impact on geopolitics in 2020. The drama of the campaign trail combined with the disruption of the impeachment process will reverberate through America’s global actions. Will the administration try to use stunt diplomacy to distract from impeachment? Would a deal with China help or hurt President Trump’s pitch to post-industrial workers? Will North Korea, Iran or even the Islamic State try to exploit the election cycle? How allies and adversaries hedge against the most ideological election in 40 years will heavily influence the geopolitical risk landscape for business in 2020.
The activist society passes judgement
Across the world, social pressures and co-ordinated activism around issues like environmental protection, Human Rights, inequality and privacy are demanding more and more from business. In the street, in shareholder meetings and in your company, the activist society will bang ever harder on the Boardroom table in 2020. For companies, paralysis looms as myriad movements make demands that are increasingly loud and challenging. This uncodified morass of social, moral and political accountability will consume any company caught unawares. Conversely, companies that get this right will be embraced. Being ethical is not enough. Being compliant is not enough. Know what to stay ahead of in 2020.
Cyber warfare hits a new level
Cyber threats in 2020 will align as never before to provoke a high impact, cyber-enabled assault on critical infrastructure. Western deterrence has failed to stem the tide and hostile actors are using ever harder methods. The US will retaliate in ways that show the world it cares. In theatres of strategic conflict, unpalatable military measures will give way to cyber attacks. A new cycle of escalation will begin: the West’s cyber-capable rivals and their proxies will raise their game with somewhat unpredictable consequences. If leading companies are attaining credible cyber resilience, national infrastructures across the globe are not and present the main vulnerability in the international cyber conflict.
Economic anxiety meets political fragility
Even the most optimistic forecasts say global economic growth in 2020 will be dismally low or, as our partners at Oxford Economics put it, “grinding”. This doesn’t take into account an economic shock that could shake an uneasy global economy. If global GDP takes a turn for the worse, we cannot expect a fragmented world to craft a co-ordinated policy response. Will countries riven by polarisation rally in the face of economic hardship? What of economies dependent on resource riches, or those that still haven’t fully recovered from 2008? In the event of a downturn – or even in the best of cases – which countries will survive, and which will go to the wall? Take a global tour of economic anxiety and political fragility.
Leaders without strategies
At the helm of some of the world’s most important countries is a crop of leaders who cannot see further than the next crisis. For them, short-term tactics will trump long-term strategy. 2020 is shaping up to be a year when the brakes on incident escalation are absent. This is a world where resilience at the state level is weak and long-term solutions take too much time to find. Whether it’s a global trade war, a cyber attack or a regional border skirmish, the pace of events is in the hands of twitchy, anxious protagonists. Business will need a strategy for an intensely tactical world.
Stratton concluded: “Mapping out business operational threats including potential political, economic and security exposure, and understanding where vulnerabilities may lie will be fundamental to success or failure in what will be an unpredictable 2020.”