Navigating constant crises: South African executives face rising risks
An increased regulatory burden on businesses globally and in South Africa is prompting a more 'safety first' compliance approach to risk management, which steers risk managers to be more reactive than proactive, and this may hinder the growth prospects of the company, according to a survey that polled executives by professional services firm BDO.
Image: AR Ron
South African executives are operating in an environment of 'constant crisis', with rising compliance and political risks adding to the geopolitical, scarce skills, growing regulatory burden, low economic growth, and environment risks that are being faced by their global peers.
This was according to Richard Walker, BDO South Africa's National Head of Risk Advisory Services, who spoke on Tuesday about the main findings from BDO's newly released Global Risk Landscape Report 2025.
The report found that while 84% of 500 senior global executives describe their operating environment as one of "constant crisis," only 7% feel genuinely proactive in their risk management approach. The need to continually adopt a cautious approach may come at the cost of growth and competitiveness in the business," said Walker in a presentation.
The global risk landscape has been in a state of flux for more than a decade due to escalating world trade tensions and shifts in geopolitical relationships and shows no sign of stabilising. This was reflected in the survey in that the perceived level of crisis among risk professionals and senior executives remained at record level.
Against this backdrop, businesses were struggling to navigate a path forward. Only 7% of executives said their risk management was 'very proactive', down from 19% in 2024 and 29% in 2023. 'This matters: if companies are overly cautious, it will weigh on growth,' said Walker.
'The chaos and volatility that's all around us right now is definitely disrupting business,' said Dave Arick, MD for Global Risk Management at claims management and loss adjusting business Sedgwick.
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'You see a lot of hesitation from businesses as they look at investments and growth because they don't know where the next curveball is going to come from, so there's a bit of a 'wait and see how it plays out' mentality,' Arick was cited as saying in the report.
The biggest change to the survey rankings for 2025 was the sharp increase in concern about people and talent. More than a quarter of executives (28%) said talent or people capacity was a top three risk, up from only 12% in 2024.
'Concerns vary by sector. healthcare and life sciences are most concerned about people/talent (44%), followed by real estate and construction (39%), and then tech, media, and telecom (34%),' the report said.
VisitRegulatory risk remained the top risk among C-suite executives, with 35% selecting it as one of the top three risks they feel most unprepared for. A significant factor was having to invest a great deal in compliance and then laws and regulations change overnight.
Some 52% of respondents named data privacy as one of the top three most important regulations for their business, more than any other type of regulation. Supply chain risk and people/talent were joint second rated in the survey.
Geopolitics remained a concern, placed at fourth. Environmental risk moved up four places to fifth, with 24% now saying they are unprepared for this. Cybercrime was still on the radar: ranked sixth.
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