Asia, 28 July 2022 – According to a new report by Mercer Marsh Benefits (MMB), cybersecurity and data privacy is now ranked as the top people-related risk by companies in Asia, followed by the risk of pandemics and other communicable diseases, and administration and fiduciary risks.
MMB’s report, People Risk: Resetting priorities to manage risks for workforce and business resilience, surveyed over 2,500 human resources and risk professionals in 25 countries globally and includes data from over 600 respondents from Asia. As well as analyzing the top 25 people risks, the report identifies the main barriers these organizations face in addressing these threats.
According to the research, only 48% of respondents in Asia believe that their organization has effective cybersecurity policies, controls and systems in place such as multi-factor authentication and data encryption. Nearly half (45%) of respondents cited the ‘lack of skilled resources to understand and address risks’ as the main barrier to managing cyber risks. Further, while 76% of respondents in Asia stated that their organization is addressing HR technology obsolescence, fewer than half (45%) believe that they have suitable processes in place to manage digital-first benefits administration and talent management.
As parts of Asia continue to follow strict COVID-19 measures, respondents in the region still view pandemics as a top risk. Despite this, only 47% of respondents stated that they have effective policies and support systems in place to enable remote, hybrid or other flexible ways of working and support a culture of employee health, wellbeing and safety (46%).
Rising costs amid economic uncertainty - along with greater scrutiny on governance of total rewards - have also brought administration and fiduciary risk to the fore as a top risk this year. While wage inflation and rising healthcare costs continue to put pressure on budgets, only 45% of companies in Asia believe they have an effective, articulated cost containment strategy in place for the next three years.
Joan Collar, Asia and Pacific Regional Leader, Mercer Marsh Benefits, said: “As the pandemic continues to accelerate digitalization, it is no surprise that cyber risks are considered as the top people-related risk in Asia. 95% of cybersecurity issues are due to human error, so reskilling and upskilling needs to be prioritized to ensure employees are keeping up with the technological development and changing world of work. A large part of human error can be attributed to employee burnout and fatigue due to ongoing pressure and anxiety caused by the pandemic, as well as antiquated systems and lack of proper cyber training.”
The report also notes how the focus on immediate threats may have come at the expense of support for employees. Despite 89% of respondents in Asia flagging health and safety of employees as a serious threat, risks such as diversity, equity and inclusion (DE&I) (ranked 17th), mental health (ranked 20th), workforce exhaustion (ranked 23rd) and work-related illness and injury (ranked 25th) have been deprioritized. Only one in two companies plan to invest in mitigating these risks in the next 12 to 24 months.
Also, less than half (42%) have effective, transparent and measurable plans in place to advance DE&I and only 48% have effective training, communication and engagement strategies around the company’s purpose, culture, values and ethics.
“Companies need to adopt a more holistic approach to develop and engage their workforce and be very mindful of blind spots on the horizon, particularly around DE&I and ethics which are key to attracting and retaining the right people. Talent and benefit practices should also to be aligned with the values of the organization, and include a clear position on important issues such as climate change policy, diversity, equity and inclusion and equitable access to benefits,” Ms. Collar added.
About Mercer Marsh Benefits
Mercer Marsh Benefits (MMB) was born out of the unification of one of the world’s most respected HR consultancies, the global leader in people risk advisory and the number one disruptive benefits technology firm to form one unique business. Together they have shaped some of the world’s most loved employee benefit experiences for small companies, growing enterprises and global firms. MMB is 7,000 strong, on the ground in 73 countries, and servicing clients in more than 150 countries. It brings local expertise to more places and works side-by-side with clients, and Mercer and Marsh colleagues around the world. Mercer and Marsh are two businesses of Marsh McLennan (NYSE: MMC), together with Guy Carpenter and Oliver Wyman. The Company’s 81,000 colleagues advise clients in more than 130 countries. With annual revenue of almost $20 billion, through its market-leading companies Marsh McLennan helps clients navigate an increasingly dynamic and complex environment.
Marsh is the world’s leading insurance broker and risk advisor. With over 45,000 colleagues operating in 130 countries, Marsh serves commercial and individual clients with data-driven risk solutions and advisory services. Marsh is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people. With annual revenue nearly $20 billion, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses: Marsh, Guy Carpenter, Mercer and Oliver Wyman. For more information, visit mmc.com, follow us on LinkedIn and Twitter or subscribe to BRINK.
Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer’s approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people, with 83,000 colleagues and annual revenue of approximately $20 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit mercer.com. Follow Mercer on LinkedIn and Twitter.