Australian leaders rank cyber as top business risk

Australian business leaders are significantly more concerned about cybersecurity risks than their global peers, according to PwC.

The company’s 2022 Global Risk Survey found that 32% of respondents rated cybersecurity as one of the top risks to revenue growth, compared to just 20% globally.

Australian respondents ranked cybersecurity ahead of business operating model risks (22%), geopolitical risks (19%), recruitment and retention (19%), and workforce management (17%).

By contrast, global respondents ranked cyber as only third on the list (20%), below market risks (22%) and operating model risks (21%), but ahead of external change (20%) and geopolitical risks (18%).

Cyber was also ranked a higher risk than COVID impacts, economic volatility and climate change by Australian respondents, PwC Australia Cyber Leader and Risk Advisory Partner Rick Crethar said.

“We’re more aware locally of our exposure to cyber threats. The government has also stepped up its focus on our national cybersecurity strategy and broader risk management obligations on our critical infrastructure,” he said.

The survey found that in the face of growing risk, 58% of Australian respondents plan to focus on hiring more risk professionals, while nearly two-thirds (63%) plan to increase their spending on risk technology.

More than half of organisations are also planning to bridge the skills gap by increasing their spending on and use of managed services.

“The war for talent is already having an impact on risk management functions across the country,” Crethar said. “To address talent challenges, Australia’s leaders are planning to use a combination of recruitment, technology uplift and flexible operating models.”

The top challenges involved in managing risks within Australian respondents’ organisations were considered to be constraints on risk management resources (87%), risk owners’ lack of required skill set (87%), risk functions’ lack of required skill set (84%) and high employee turnover (79%).

“Australia’s leading organisations are recognising they need greater skills and expertise for some of the more complex risks, such as third-party risks, privacy, data, financial crime, strategic/modelling, cyber and ESG,” Crethar said.

“The challenge is that line two headcount is still low, placing greater reliance on alternate sourcing models and greater automation to free up existing skilled resources.”

Other emerging risks which organisations in Australia are watching closely include the macroeconomic environment, with fears that a recession is looming, as well as major climate change impacts such as extreme weather and natural disasters, the report found.

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